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ACCOUNTANCY COLLECTION
By Arindam Mukherjee
1.On January 1, 2017, Humna Faisal’s cash book showed debit balance of cash Rs. 1,500
and bank Rs. 12,500. During the month of January following business was transacted:
2017
Jan.1 Deposited cash Rs. 500 to business bank account.
” 7 Purchased office furniture for cash Rs. 700; cash sales Rs. 2,000.
” 9 Received from Mr. Shabir a cheque for Rs. 2,550 in part payment of his
account and not deposited.
” 12 Paid by cheque for goods purchased to Mr. Gulzar worth Rs. 1,000.
” 18 Drew from bank for owner domestic use Rs. 200.
” 21 Sold merchandise to Zeshan Bros. for Rs. 1,500 who paid by cheque which
was deposited in the bank.
” 24 Paid to Mr. Salman Rs. 900 by cheque.
” 28 Deposited into bank the cheque received from Mr. Shabir.
” 29 Paid salaries by cash Rs. 950.
” 30 Drew from bank for office use Rs. 450.

Requirement: Draw up Cash Book with Cash and Bank Columns.

Solution:
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2.he Edward Company uses a double column cash book to record its cash and bank
related transactions. It engaged in the following transactions during the month of March
2018:

 March 01: Cash balance $1,450 (Dr.), bank balance $1,500 (Dr.).
 March 02: Paid Mark & Co. by check $120.
 March 04: Received from John & Co. a check amounting to $400.
 March 05: Deposited into bank the check received from John & Co. on March 04.
 March 08: Purchased stationary for cash, $25.
 March 12: Purchased merchandise for cash, $525.
 March 13: Sold merchandise for cash, $1,800.
 March 15: Cash deposited into bank, $850.
 March 17: Withdrew from bank for personal expenses, $40.
 March 19: Issued a check for merchandise purchased, $630.
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 March 20: Drew from bank for office use, $150.

 March 22: Received a check from Peter & Co. and deposited the same into bank
immediately, $880.
 March 25: Paid a check to Daniel Inc. for $270.
 March 26: Bought furniture for cash for office use, $175.
 March 28: Paid office rent by check, $120.
 March 29: Cash sales, $650.
 March 30: Withdrew from bank for office use, $145.
 March 31: Paid salary to employees by check, $300.

Required: Record the above transactions in a double column cash book and post entries
therefrom into relevant ledger accounts.

Solution

Cash book:
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3.Enter the following transactions in a double column cash book/two column cash book.
2005 $

March 1 Cash in hand 80,000

March 1 Bank Balance 120,000

March 3 Received a cheque from Osman 24,000

March 4 Deposited Osman's cheque with bank --

March 8 Withdrawn from bank for business use 20,000

March 10 Goods sold for cash 30,000

March 15 Goods bought for cash 80,000

March 18 Goods sold for cash 60,000

March 20 Paid Rahim by cheque 26,000

March 30 Deposited into bank 16,000

March 31 Paid salary in cash 10,000

March 31 Paid rent by cheque 6,000

Solution:

Double Column Cash Book

Dat Particula V/ L/ Cash $ Bank $ Dat Particula V/ L/ Cash $ Bank $

e rs N F e rs N F

200 200
5 5

Mar. Balance 80,000 120,000 Mar Bank A/c C 24,000

1 b/d . 4 (Being
cheque
deposited
)

3 Osman 24,000 8 Cash A/c C 20,000

A/c (Being
(Being cash
cheque withdraw
received) n from
bank)

4 Cash A/c C 24,000 15 Purchase 80,000

(Cheque A/c
deposited (Being
with goods
bank) bought)
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8 Bank A/c C 20,000 18 Cash A/c C 16,000

(Being
cash
drawn
from
bank)

10 Sales A/c 30,000 20 Rahim A/c 26,000

(Being (Cheque
goods issued)
sold 'for
cash)

18 Sales A/c 60,000 31 Salary A/c 10,000

(Being (Being
goods salary
sold for paid)
cash)

30 Cash A/c C 16,000 31 Rent A/c 6,000

(Being (Being
cash rent paid
deposited by
) cheque)

31 Balances 84,000 108,000

c/d

214,000 160,000 214,000 160,000

Apri Balance 84,000 108,000

l. 1 b/d

4.Enter the following transactions of M. Rauf in a Double Column Cash Book and post
them to concerned accounts in ledger:

2005 $

Jan. 1 Cash in hand 100,000

Jan. 1 Cash at Bank 60,000

Jan. 3 Cash Sales 40,000

Jan. 4 Paid M. Arshad by a cheque 14,000

Jan. 6 Received a cheque from Babar 8,000

Jan. 8 Cash deposited into bank 19,000

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Jan. 8 Babar's cheque deposited into bank --

Jan. 10 Drew from bank for office use 15,000

Jan. 11 Drew from bank for personal use of owner 24,000

Jan. 12 Cash purchases 57,000

Jan. 15 Received a cheque from S. Rashid 10,000

Jan. 16 Rashid's cheque endorsed to Shakeel --

Jan. 17 Paid Arshad Khan by a cheque 36,000

Jan. 18 Rashid's cheque returned dishonored --

Jan. 19 Our cheque to Arshad Khan was dishonored --

Jan. 21 Received interest from bank 1,400

Jan. 24 Cash sales 33,00

Jan. 27 Incidental charges debited by bank 700

Jan. 31 Salary paid by cheque 14,000

Solution:

Cash Book (double column)

Dat Particul V/ L/ Cash $ Bank $ Dat Particul V/ L/ Cash $ Bank $

e ar N F e ar N F

200 200
5 5

Jun. Balance 100,000 60,000 Jan. M. 7 14,000

1 b/d 4 Arshad
A/c

3 Sales A/c 5 40,000 8 Bank A/c C 19,000

1
6 Babar 9 8,000 8 Bank A/c C 8,000
A/c

8 Cash A/c C 19,000 10 Cash A/c C 15,000

8 2Cash C 8,000 11 Drawing 11 24,000

A/c A/c

10 Bank A/c C 15,000 12 Purchase 13 57,000

A/c

15 3S.Rashid 15 10,000 16 Shakeel 16 10,000

's A/c A/c
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4
19 Arshad 17 36,000 17 Arshad 17 36,000
Khan A/c Khan A/c

5
21 Interest 19 1,400 27 Bank 20 700
A/c charges
A/c

24 Sales A/c 5 33,000 31 Salary 21 14,000

A/c

31 Balance 112,000 20,7000

C/d

206,000 124,400 206,000 124,400

Feb. Balanced 112,000 20,700

1 b/d

5. From the following transactions prepare a two column cash book and post entries
therefore to ledger accounts.
ear: 2016
Jan. 01: Opening balance of cash $4,500.
Jan. 03: Received cash from R & Co. $3,880 and allowed them a discount of $20.
Jan. 05: Paid cash to H & Co. $3,590 and received a discount of $10.
Jan. 07: Merchandise purchased for cash $940.
Jan. 09: Received interest on investment $365.
Jan. 12: Purchased machinery for cash $4,100.
Jan. 15: Cash sales for the first half of the month $6,500.
Jan. 17: Paid cash for stationary $635.
Jan. 20: Paid for office furniture $710.
Jan. 21: Paid to H & Co. $970 and received a cash discount of $30.
Jan. 28: Cash received from R & Co. $670 and allowed them a discount of $30.
Jan. 31: Cash sales for the second half of the month $7,600.
Jan. 31: Paid for salaries $1,250.
Solution
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General ledger
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Accounts receivable ledger

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Accounts payable ledger

6. From the following transactions write up a two column cash

book and post into ledger:
1991

Jan. 1

Cash in hand $2,000

" 7 Received from Riaz & Co. $200; discount allowed $10

" 12 Cash sales $1,000

" 15 Paid Zahoor Sons $500; discount received $15

" 20 Purchased goods for cash $300

" 25 Received from Salman $500; discount allowed $15

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" 27 Paid Hussan & Sons $300.

" 28 Bought furniture for cash $100

" 31 Paid rent $100

7. We will now learn how the transactions are recorded in the double column
cash book.
Consider the following example:
The following transactions related to M/s Tools India :
Date Details Amount
Rs.
2014
Sept. 01 Bank balance 42,000
Sept. 01 Cash balance 15,000
Sept. 04 Purchased goods by cheque 12,000
Sept. 08 Sales of goods for cash 6,000
Sept. 13 Purchased machinery by cheque 5,500
Sept. 16 Sold goods and received cheque (deposited same day) 4,500
Sept. 17 Purchase goods from Mriaula in cash 17,400
Sept. 20 Purchase stationery by cheque 1,100
Sept. 24 Cheque given to Rohit 1,500
Sept. 27 Cash withdrawn from bank 10,000
Sept. 30 Rent paid by cheque 2,500
Sept. 30 Paid salary 3,500

8. he following balances are extracted from the books of Ms. Maria Waseem, Prepare
Trial Balance as on 30.6.2015:
Owner’s Equity Rs. 470,200 Machinery Rs. 158,800 Cash in hand Rs.
6,000
Account receivable Rs. 48,000 Building Rs. 320,000 Repairs Rs. 5,400
Stock Rs. 33,000 Insurance premium Rs. 3,300 Account payable Rs.
26,000
Sales Rs. 290,000 Commission Rs. 750 Telephone charges Rs.
6,450
Rent & Taxes Rs. 6,300 Furniture Rs. 11,000 Purchases Rs.
165,000
Discount earned Rs. 1,100 Loan from Sidra Rs. 51,000 Salaries Rs. 70,600
Reserve fund Rs. 5,900 Discount allowed Rs. 650 Note receivable Rs.
8,600
Drawings Rs. 5,000 Bad debts Rs. 1,350 Bills payable Rs.
6,000

9. Prepare Trial Balance from the following balances of Mr. Akhtar as on 31.12.2016:
Capital Rs. 420,000 Cash in hand Rs. 25,000 Building Rs.
115,000
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Cash at bank Rs. 84,700 Machinery Rs. 60,000 Sundry Creditors Rs.
68,000
Furniture Rs. 11,000 Rent Rs. 48,000 Car Rs.
68,000
Opening stock Rs. 86,000 Commission Rs. 1,400 Rates and Taxes Rs.
2,600
Purchases Rs. 94,000 Bad debts Rs. 3,200 Sales Rs.
196,000
Insurance Rs. 2,400 General Expenses Rs. 800 Sundry debtors Rs.
16,200
Reserve for doubtful debts Rs. 7,300 Salaries Rs. 94,000 Closing Stock Rs.
12,000
Unearned Revenue Rs. 16,000 Interest received Rs. 5,000

10. Prepare Trial Balance as on 31.03.2012 from the following balances of Ms. Maliha
Afzal:
Drawings Rs. 74,800
30,000
Bills receivable Rs. 52,500
Discount allowed Rs. 950
Freight Rs. 3,500
Insurance Rs. 2,700
1,000
Bank loan Rs. 120,000
Machinery Rs. 215,400
Purchases Rs. 295,700 Stock (1.04.2011) Rs.
Capital Rs. 250,000 Furniture Rs. 33,000
Sales Rs. 335,350 Rent Rs. 72,500
Printing charges Rs. 1,500 Sundry creditors 75,000
Sundry expenses Rs. 21,000 Discount received Rs.
Stock (31.03.2012) Rs. 17,000 Income tax Rs. 9,500
Bills payable Rs. 31,700

11. Prepare a Trial Balance for Shining Brothers Pvt. Ltd. at March 31st, 2017?

12. There are several Mistakes in the Umer & Brothers (Pvt.) Ltd. Trial Balance. You are
requested to identify Errors and make corrected Trial Balance?
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