faZC{:

i. List of Transactions
i.

Sample Exercise

Nandini Kapur's transactions for the year 2004_05 are as FoJlows you
are required to
Record the transaciions
Prepate ftnancial siatements.

o
E

LIST OF TRANSACTIONS _ LEVEL 1 _ YEAR

TRANSACTIONS

APRIL

2OO4

N?ndini Kapur started Universal Business

cash of Rs.3,00,000

SoiuGniIllring6g

in-

lvs. KapJrpa'd Rs.22.500 in cabh lo purchu.e rio"puGi* tn

pre'oaoed rdlly7.2 The compu,e. does noi hdvo ary di"posal value
at ih^ end ol rts uselL' ,lle o[ fout years A t acseLs aie to be
depreciared us ng rhe straight line rFthoo.

Kapur opened a bank account with HDFC Bank. Banoalore forthe':'- by deposi|rg cash ol Rs.1,0O,O0O
l\,4s-

4-4-2AA4

\,4s. KapJr 1ad rented ar ofice soale for Rs.2,50qpcr rnorlh on

Ap.il 1,2004and has nowpa;d be(u.ty deposit o/RsiZS-OOO oy

KaoJr-lired l\y'aya r.,la? ac r\,4andger _ op",at;ons.-onLhly

salary ot R. 7.500. She also 1i.ed Vijay Narayan as Ass,star't
IVIS

lvlanager - marketing on a monthly salary oi ds. 4,500

10-4-20a4

Kapur made affangerrent with RajTraveis so that at regular

intervals she wiJl receive bills for cab hire charqes and tour
expenses.
l\,4s.

1r3

Appendir

15-4-2444

Fs.Kapur issued cheques and purchased

1.

the following fixed assets

Acell phone for office usage for Rs.6,000 (useful lile 5 years)
Furniture for Rs 20,000 (usefLl! life 8 years).

2
3 An Air conditioner for Rs 20,000 (usefLll life 6 years)
4. Etectrical Flttings for Rs.15,000 (useful ife 10 years)
B)

rc-4,2AA4

s)

20-4-2444

10)

21 4-2004

The asseis do not have any disposal value at the end of their useful
life
Planet
Ms Kapur obtained a mobile phone subscription wiih
jncash'
Rs.3,000
bypayngadepositof
TelecommunlcationsLtd
Ms Kapur purchased stationery consumables worth Rs 12,500 from
Global House on credit
lvls Kapur entereci into a contract with Silver SeNices for providing
consuJtancy seNices at an agreed prlce of Rs 75'000 She received
6"- alEi
an advance of Rs 25,000 by
Bank
Ms. Kapur depos ted Rs 50,000 cash in HDFC
Ms. Kapur recelved an invoice for Rs 6,000 raised by lnk and Paper
Publjshers for printing of offlce stationery
Ms. Kapur withdrew Rs 7,500 cash for perconal uFe.

cheque.

11)

23-4-2004

12)

25,4-2044

13)

27

14)

30 4-2004

15)

rs-2044

lVIs Kapur paid Rs.75O in cash towards office maintenance charges

for April 2004.
MAY 2004
Ms. Kapur paid Rs.6,000'ln cash to lnk and Paper Publishers

16)

5-5-2004

Ms Kapur paid Rs 2,500 by cheque towards office rent for April

-4-2044

2004.
17)

6-5-2404

l\,4s

1
2.

Kapur paid salaries throLrgh cheque forApril 2004(25 days) to

Rs 6,500
l\,4aya Nair

Vijay Narayan

ls

Rs 3 900

18)

7-5-2004

Kapur received and Paid mobile phone bill amounting to

Rs.1,250 in cash forAPil 2004.

1s)

10-5-2004

M". Kupu i".uid

20)

12-5-2004

Ms Kapur paid Rs.'1 ,1OO in cash towa.ds electrlcity charges for April

"h"que

of Rs 12,500 to Global House

20a4.

21)

M-5-2A04

Lls. Kapur received furtheradvance of Rs 25,000from SilverServjces

by cheque

22)

15-5-2004

l\4s. Kapur reimbursed

conveyance bil!s amounting to Rs.650 jn cash

to Viiay Narayan

itrai!

(h.li.) Prr Lid

z0jrd

Appendix

23)

18-5-20A4

tMs Kapur paid Rs 150 jn cash towards miscellaneous office

expenses

24)

20-5-2004

lvls. Kapur received Rs 15,000 of consult ng revenue jn cash from

Omega lnfotech

25)

25-5-2404

,Y. \4((D,
Ms. Kapur raised an invoice for Rs 75,000 on Silver Services afler
p s7.
co^'ro etion of lhe service. Silver Se.!ices paid rhe balarce amount of
g .ger.
Rs.25.000 ir uash aler deducting the ddvance pa

d.

26)

28 5-2404

Ms Kapur withdrew Rs.6,000 cash for personal

use.

JUNE 2OO4
27)

3-6-2044

28)

4-6-2044

29)

5-6-2004

30)

9-6-2A04

Ms. Kapur paid Rs.2,500 in cash towards office rent

Ir,4s Kapur paid salar es by cheque for N.4ay 2004

for Mav 2004

l\ls. Kapur received an invoice for Rs 5,500 frcm Ral Travels This
includes Rs 2,300 towards cab hiring charges and Rs 3,200 towards
outstation tours undertaken by her
Ms Kapur received Rs 35,000 in cash as consultino revenue frorn
Eaterles Food Chain

31)

10-6-2004

32)

15-6-2004

l!4s Kapur deposited Rs.30,000 cash in HDFC Bank.

l\,4s

Kapur paid mobile phone bill amounting to Rs.1,350 by cheque

for May 2004.

33)

16-6-2A04

I\4s KapLrr reimbursed conveyance bills amounting to Rs.750 jn cash

to Vijay Narayan

34)

2A-6-2A04

Ms. Kapur paid Rs 1,250 in cash towards electricity bill charges for
May 2004

35)

21-6-2004

IVlS

Kapur paid Rs 750 in cash towards office maintenance charges

for May 2A04.

36)

23-6-2004

37)

27

-6-2004

f,4s. Kapur paid Rs 3 000 in cash as salary advance to l\raya

Nair

IVs. Kapur withdrew Rs 6 000 cash for personal use

JULY 2004
38)

3-7 -2044

oTa!y (ln.tia) pvr Lt.t 2006

I\4s Kapur raised an invoice for Rs.65,000 on Alfatech Sotution3lor

seruices provided

39)

6-7 -2004

ft,1s KapLrr sub^scr bed for the 'l\4anagement Consultant. journal

by

paying Rs 2,400 by cheque. Ihe subscription period is from July

2004 to June 2006.
40)

7-7 -20A4

vts Kapur patd saares for June2004 bycheque Salaryaclvance

pald to l\4aya Nair is adjusted aqainst the sa arv Daid

41)

1A 7-2AA4

'42)

15-7 -2004

43)

1B-7 -2C04

vlc Kaour pdtd or ce r-rt b/ cneqJ. for June 2oozl

rv5 \dpL'r6Le /Fd Rs 35.000 by .heqte fro-rArlaLe(l SoLtions
vrs. Kapur patc Rs /5u in cash towards office maintenance
charges

for June 200.1

44)

19-7 -2AA4

vrs Kapur patd Rs tj50 in cash towards electr city charges for JLtne
20a4

45)

2A-7 -2AA4

Nts Kapur patd Rs 1,650 by cheque as moblle phone bilJ charges for
June 2004

46)

25-7 -2AA4

JVrs.

Kapur relmouTsed conveyance bills for Rs.550 in cash to Vijay

47)

28-7 -20A4

vs

Kapur wfndrew Hs.6,500 cash for personal use

AUGUST 2O04

4B)

1-B-2004

vs. (aoJr patd

19)

2-8-20A4

50)

5-B-20A4

51)

1A-a-20a4

52)

12-8-2004

s3)

14-8-2A04

54)

16-8-2A04

s5)

18-B-2004

s6)

20-8-2AA1

Ms Kapur patd Hs 2,100 by cheque towards mobile phone bjl

charges for J uiy 2004

57)

21-B,2AA4

veoraL ve Productions setfled the b-illfor a final arnount of Rs.4B.OOO

o) pai,nq Rq.20 00C in cash and Rs.26,O0O by cleqJe

58)

27 -B-2AA4

5e)

28-8-2A04

Kapur withdrew Rs.7,000 cash for personal use

iVs Kapur recetved Rs 30,000 by cheque from Alfatech Solutions

60)

29-8-2AA4

by L"eq .e

Rs.o.000'or rsurarce o. .iyeo ajsets.

l\4s Kapur paid salar es for July 2OO4 by cheque.

l\ls Kapur paid office rent for Ju/y 2004 by cheque
Ms. Kapur wtrndrew ;1s.25,000 cash from HDFC Bank
Ms Kapur pa d Rs 750 rn cash towards ofiice maintenance charges
for J uly 2004

vrs Kapur Tatsed an lnvoice for Rs.50,000 on MediaLive p.oductions

for services provided The terms of c.edlt are 30 davs
vrs Kapur pa d Hs gb{J rn cash towards e ectriclty charges for July
2044

I\,4s.

lT", .dr P.rLrd

!n6

Appendix

61)

2-9-2044

62)

5-9-2004

63)

8-9-2004

64)

9-9-2404

65)

12-9-2004

66)

15-9-2404

67)

17

68)

20-9-2004

-9-2044

SEPTEMBER 2OO4
\y's. Kapur paid Rs 3,800 in cash for repairs and rnalntenance of
oflice premises.

lVs Kapur paid sala.ies forAugust 2004 by cheque. S nce Maya Nair
was on leave for '15 days, she was paid one half-month's salarjr
Ms Kapur paid offce rent forAugust 2004 by cheque
Ms. Kapur received invoice for Rs 7,600 from Raj Travels. Th s
includes Rs 3,150 towards cab hiring charges and Rs 4,450 towards
outstation tours undertaken by he
lvs. Kapur paid Rs.750 n cash towards ofiice ma ntenance charges
forAugust 2004.
lvls. Kapur received Rs 25,000 in cash as consulting revenue from
Carn and Cut Productions

Ms. Kapur paid Rs.1,300 in cash towards electricity charges for

August 2004.
l\4s. Kapur reimbursed conveyance bills amounting to Rs 500 in cash

to Vijay Narayan

6s)

23-9-2004

70)

24-9-2044

71)

28-9-2004

Kapu. paid Rs.10,000 by cheque to Raj Travets

l\,4s. Kapur paid Rs. 1,750 by cheque towards moblle phone bill
charges for August 2004
Ms Kapur withdrew Rs.s.500 cash for personal use
I\,4s.

ocToBER 2004
72)

3-10-2004

Ms Kapur received Rs 50,000 by cheque as consulting revenue

from Xceed International Couriers

73)

5-10-2004

74)

Ms Kapur paid office rent for September 2004 by cheque.

Ms Kapur withdrew Rs.30,000 cash from HDFC bank

75)

8-14-2404

IVls Kapur paid salaries for September 2004 by cheque

76)

10-10-2004

lvls Kapu. paid Rs.750 in cash towards office rnaintenance charges

for September 2004

77)

12-10-24O4

Ms Kapur purchased

t8l

15-14-2404

7s)

1A-14-2004

Ms. Kapur paid

September2004

80)

20-10-2004

Nls Kapur paid Rs 2 300 by cheque towards mobite phone bitl

charges for September 2004

81)

23-10-2404

Ms Kapur introduced further capital into the firrn bybringng in cash

of Rs.1,00,000

82)

24-14 2004

Ms. Kapur deposited cash amounting Rs.75,000 in HDFC Bank.

-14-2004

19laly (nd a)Pvt Lrd 2006

stat onery items worth Rs 1 ,600 in cash_

l\,4s Kapur recejved Rs 15,000 in cash as consultjng revenue from
Samaritran Products

Rs

'1,700 in cash towards electricrty charges fo.

83)

26-10-2AO4

Ms Kapur reimbursed conveyance bills amounting to Rs 1,600

ln

cash to Vijay Narayan

B4)

28-1A-2004

l\,4s. Kapur entered into a contract with Planet Consultancy for

providing services at an agreed price of Rs 35,000 An advance of
Rs. 10,000 was received by cheque.

NOVEMBER 2OO4

8s)

1-11-2004

B6)

2-11-2004

87)

5-11-2004

Nls. Kapur paid salaries for October 2004 by cheque

88)

a-11 2004

[y's. Kapur paid Rs 750 in cash towards ofilce maintenance charoes

Kapur withdrew Rs 8,000 cash for pe.sonal use

Ms- Kapur received an invoice for Rs.7,200 from RajTravels This
includes Rs 2,800 towards cab hiring charges and Rs.4,400 towards
outstatlon iours undertaken by her
N,4s

for October 2004

Ms Kapur received Rs 27,500 by cheque as consulting revenue

+om Tr'sr.rl Software SoJutions

Be)

1A-11-2004

e0)

12 11-2004

l\,4s Kapur paid ofiice rent for October 2004 by cheque.

91)

15-11-2004

PJanet Cohsuliancy terminated the contract and advance

of

Rs.10,000 was refunded to them by cheque.

HDFC Bank intimated to l\,4s Kapurthatthe cheque of Trjshul Software
Solutions for Rs.27,500 has bounced. lntimation to this effect was
sent to Trishul Software Solutions and they promised to pay the
arnountinfew days.

e2)

2A-1't -2004

93)

21-11-2AA4

Ms. Kapur paid Rs.950 in cash towards electricfty blll charges for
October 2004.

e4)

23-11-2004

Ms. Kapur received Rs. 12,500 in cash from Trishul Software

Solutions

es)

25-11-2004

s6)

27

-11-2404

Ms. Kapur paid Rs.1,470 by cheque towards mob e phone bill

charges for October 2004
l\,4s.

Kapur reimbursed conveyance bills amounting to Rs.900 in cash

to Vljay Narayan.

e7)

3A 11-2004

Ms. Kapur withdrew Rs.6,500 cash for perconal use.

DECEMBER

2OO4

e8)

3-12-2004

The siatement received from HDFC Bank shows that the bank has
charged Rs.550 as cheque bouncing charges and Rs.330 as cheque
book charges. Cheque bouncing charges are to be recovered from
Trishul Software Solutions.

ee)

5-12-2004

100)

6-12-2004

Ms. Kapur paid office rent for November 2004 by cheque.

Ms Kapur paid salaries for November 2004 by cheque.

nTal/

( nd a)

Pla

Ltd

2006

Append x

101)

8-12-2AA4

102)

9-12-2AA4

103)

10-12-2004

104)

11-12-2004

Ms. KapLr .eceived in,,oicF tro.n Ra. Travels fo, Rs 6,200. iiris
irc Ldes Rs.3.000 towa-ds (ab htritg .^a.9.s a1d Rs.3,200 towards
outstation tours undeftaken by her.

Ms Kapur withdrew Rs.30,000 cash from HDFC Bank.

Ms. Kapur paid Rs 750 n cash towards office mihtenance cha.ges

for Novernber 2004.

l\y's. Kapur purchased Rs.12,000 worth office equipments on credit
from Transform Tech pvt Ltd. The asset does not have any disposal
value after its useful life of 6 years.
Ms Kapur paid Rs 1 ,450 by cheque towards mobile phone bi I
charges for November 2004.
Nls. Kapur paid Rs 850 in cash iowards electr city b ll charges for
November 2004

105)

15-12-2004

106)

16,12-2004

107)

18-12-20A4

108)

20-12-2004

N4s. Kapu r reimbursed conveya nce b ls amounting to Rs.1

,1OO in
cash to Vijay Narayan

109)

23-12-2004

Ms Kapur paid Rs 12,000

'110)

24-12-2004

111)

25-12-20A4

Kapur.aised invoice for Rs.42,500 on InGroove Designers for

consultancy services
N,4s. Kapur received Rs. 15,550 in cash from Trishul Software

by cheque to Transform lech pvt. Ltd

lr,4s.

Solulions
112)

28-12-20A4

113)

30-12-2004

114)

3-1-2005

115)

5-1,2005

116)

6-1-2005

117)

10-1-2005

,,\

12-1-2AA5

1r9i

tN,ln

15-1-2005
'18-1-2005

121)

20-1-20a5

Kapur withdrew Rs.6,000 cash for persona use

l\4s. Kapur paid Rs.7,500 by cheqLre towards professional charges for
ntema aud t of accounts
l\,4s-

JANUARY 20O5
Ms Kapur paid office rent for December 2004 by cheque.
IVs. Kapur received Rs_30,000 in cash from lnGroove Desioners.
[,4s. Kapur paid salaries for December 2004 by cheque
Ms. Kapur paid Rs 750 in cash towards office maintenance charoes
for December 2004
MS KApUr recetved Rs.35,01J0 by cheque as consulting revenue
from Ala Carte lnvestments.
Ir4s Kapur withdrew Rs.50,000 capjtal from the firm by cheque
l\,4s. Kapur paid Rs 2,300 by cheque as mobile phone bl I charges for
December 2004

l\ls Kapur pajd Rs 1,050

December 2004.

122)

oTa

y(

23-1-2005

ra,a)PvL Ltct. z.os

in cash towards electricity charges for

Ms. Kapur reimbursed conveyance bills amounIng to Rs.i,80O in

cash to Vijay Narayan

119

POWER oF

123)

30-1-2005

lls

MPLtclrY

Kapur withdrew Rs 8,000 cash ior persona use

FEBRUARY 2OO5

lls

124)

5-2-2005

125)

6-2-200s

126)

10-2-2005

received nvoice frorf Raj Travels for Rs g 400. This

ncludes Rs.3,800 towards cab h ring charges and Rs.5,600 towards
outstation tours undedaken by her.

127)

11-2-2005

Ms. Kapur paid Rs.20,000 by cheque to Ral Travels

128)

12-2-2AO5

N4s. Kapur paid Rs 750 in cash iowards office maintenance charges

for January 2005

129)

15-2-2005

130)

18-2-2005

Kapur paid Rs.1,600 by cheque towards mobile phone bill

'Vs
charges
for January 2005
Ms Kapur paid Rs 1,200 ln cash towards electricity bill for January
2045.

131)

20,2 2AA5

Ms KapLrr ieirnbursed conveyance bills amounting to Rs.1,150 in

cash to Viiay Narayan

132)

24-2-2AO5

Ms. Kapur purchased stationery consumables wodh Rs 7,400 on

credit from Global Holrse

133)

28-2-2005

l\,4s.

Kapur paid oflice rent for January 2005 by cheque.

l\1. KpoLr pa d sdld. es 'or JdnLdry 2005 by c^eqLe
l\4s. Kapur

Kapur withdrew Rs.7,000 cash for personal use

MARCH 2OO5

134)

3-3-2005

Ms. Kapur paid salaries by cheque for FebrLtary 2005.

135)

5-3-2005

Ms. Kaplrr paid office rent for February 2005 by cheque

136)

8-3-2005

Ms. Kapur paid Rs 750 in cash towards office maintenance charges

for February 2005.

137)

10-3-2005

Ms. Kapur received Rs.30,000 in cash as consulting revenue from

Eye Ie evision Network

138)

12-3-2005

Kapur paid Rs 1,,+50 in cash towards electric ty blll

2005.

139)

15-3-2005

N4s. Kapur paid Rs 1,900 by cheque towards nrobile phone bill

charges for February 2005

140)

18-3-2005

I\,4s.

for February

l\4s Kapur reimbursed conveyance bills amounting to Rs.950 in cash

to Vijay Narayan.

141)

20-3-2AO5

lJ'rvoice received frorf clobal House on 24th of February 2005 had a

totaling error and was overvalued by Rs.600.

142)

21-3-2005

I\,4s.

143)

25-3-2005

Kapur paid Rs 6,800 by cheque to Global House

Ms. Kapur withdrew Rs 6,500 cash for persona use.

io

T.

,i (l1.lia)

P!: Lt.l 2oDi

Appendix

PROVISIOT,I ENTRIES

144)

14-2445

Ms Kapur recejved Rs 20,000 cash as consulting revenue from

145)
146 )

2-4-2005
5-4-2005

[,4s Kapur paid offige rent for l\4arch 2005 by cheque

Ms. Kapur paid salaries by cheque for [,4arch 2005

1471

148)

12-4-2005

14S)

15-4-2005

-4-2005

Forec Marketing Solutions- The seNices had already been provided

ln March 2005

Ms. Kapur paid RS 750 in cash towards office maintenance'

charges for Nlarch 2005
I\,4s Kapur paid Rs.1,690 by cheque towards mobile phone bjJ
charges for March 2005.
\,4s.

\dpu'rei-nb'rsed colveyance bills an-oJ.rting ,o Rs.1300

cash to Vijay Na'ayan.

'he

in

b:ils petlain io l\,4arch 2005.

150)

18-4-2045

Kapur received invoice from Raj Travels for Rs 6,600. This

includes Rs.2,900 towards cab hiring charges and Rs.3,700
towards outstation tours undertaken by her The bill pertajns for
February 2005 and March 2005.

151 )

20-4-2005

Ms Kapur paid Rs.870

I\,4s.

in cash towards electricity bill for March

2005
DEPRECIATION ENTRIES
Date

of

purchase

to be
depreciated
(a)

Annual
depreciation
(a)/(b)=
(c)

Depreciation
for 2004-05
(c).(d)/36s=
(e)

5,610

22,500

Computer
Cellular
Phone
Furniture

6)

Electrical
Fiitings

15-4-2004

Office

15-12-2404

Equipmenis
14,401

Disposalva ue ior ail assets = 0

Value io be deprecjated (a) is same as the purchase cost

oT.ltr

( ndia)

plt Lrd 2006

!-!:f-r-:

=.,4 .i,r.,

:'1 ,L-1s-rr4a,l5/

'"

- '

Append (

F.DJUSTMENIT ENTRIES FOR PREP,AID EXPENSES

h!atu.-e

Dat

Period of
Subscription/
lnsurance (a)

1-7,2404
Magazine
sLrbscription

6-7 -2AA4

lnsurance

1-A-2004

(b)

Prepaid

Frepaid

Period {c)

Amount
(b)/(a)'(c)

eurrent

=(d)

(b).(d)=(e)

1-4-2005 to

30-6-2006
(24 months)

2,4A0

30-6-2006
(15 months)

1-8-2004 (o

6 000

1-4-2005 to

31-7 -2005

Year

1,500

900

2,000

4,000

31-7-2005
(4 months)

(12 months)
OTHER ADJUSTMENT ENTRIES

sL.

NO.

NATURE OF ADJUSTfr4ENT

2)

Provis ons for income tax (2004-05) has to be made at Rs 17,500

Closlng stock of stationery consumables on 31st, March 2005 is Rs.5000.

3)

Transfer balance of withdrawals account io Nandini Kapur's Capital account

1)

CLOSiNG ENTRY
sL. fJo.
TRATISACTION
1)

Transfer balance of profit and oss account to Nandini Kapur Capital account.

ii. Practice Exercise

Nandini Kapur's transactions for the year 2005 - 2006 are as follows. you are required to

E
E

Record the transactions.

Prepare financ al statements.

LIST OF TRANSACTIONS - LEVEL 1 - YEAR 2

SL. NO
DATE
TMI,ISACTIONS
APRIL
1)

1-4-2005

2OO5

Transfer opening balance of stock of statlonery consumables

(31st l\4arch 2005) account to stat onery expenses account

e--.

./

' ..1P,;i Li:

?afa