Students must practice these AP Inter 1st Year Accountancy Important Questions 7th Lesson Journal Proper to boost their exam preparation.
AP Inter 1st Year Accountancy Important Questions 7th Lesson Journal Proper
Short Answer Questions
Question 1.
What is Journal Proper? [May ’17 (AP)]
Answer:
There are some transactions which cannot he recorded in any of the remaining seven subsidiary books, are entered in special book known as “Journal proper”.
Question 2.
Explain various kinds of transactions that are recorded in Journal Proper.
Answer:
The following are the transactions recorded in journal proper.
1) Opening entries: Opening entries are passed at the commencement of the new year, to record the balances of assets and liabilities brought forward from the previous year.
The rule to be applied as
(Being last year balance brought forward).
2) Purchase and sale of fixed assets: Business organisations either purchase or sell the assets for cash and sometimes on credit. If it is purchased on credit, then the entry should be recorded in the journal proper.
Example: Purchased machinery from Godrej Company 40,000.
3) Rectification entries: Sometimes errors may occur while recording transactions, posting them into the ledger or while balancing the ledger accounts. In such cases certain entries should be passed in order to rectify the errors. Such entries are called “Rectification entries”.
Example: Rama paid Rs. 1000. This was credited to Bheema’s A/c.
4) Adjustment entries: At the time of preparation of final accounts of the business firm some
adjustments are to be made. The journal entries relating to these adjustments are known as “Adjustment entries”.
Example: Outstanding expenses, prepaid expenses, incomes receivable, income received in advance, depreciation, etc.
5) Closing entries: At the end of every financial year the balances of all the Nominal accounts are transferred to the Trading and Profit & Loss accounts. These transferred entries are known as Closing entries. All expenses and losses are debited and incomes and gains are credited to Trading, Profit & Loss account.
6) Transfer entries: Sometimes the trader transfers the amount from one account to another account. This type of journal entries are known as ‘Transferred journal entries’.
Example: Transfer of Profit to Reserve Fund.
7) Other entries: It is not possible to enter same transactions in journal and hence they are recorded in Journal Proper.
Example: Interest on drawings, interest on capital, goods lost due to fire & theft, goods sent on consignment, etc.
Question 3.
Explain the following in not more than 5 lines.
a) Opening Entries
b) Rectification Entries
c) Adjustment Entries
d) Closing Entries
Answer:
a) Opening Entries: Opening entries are passed at the commencement &f the new year, to record the balances of assets and liabilities brought forward from the previous year.
The rule to be applied as
(Being the last year balance brought forward).
b) Rectification Entries: Sometimes errors may occur while recording transactions, posting them into the ledger or while balancing the ledger accounts. In such cases certain entries should be passed in order to rectify the errors. Such entries are called “Rectification
1 entries”.
Example: Rama paid Rs. 100. This was credited to Somu’s A/c.
c) Adjustment Entries: At the time of preparation of final accounts of the business firm some adjustments are to be made. The journal entries relating to these adjustments are known as “Adjustment entries”.
Example: Outstanding expenses, prepaid expenses.
d) Closing Entries: At the end of every financial year the balances of all the Nominal accounts are transferred to the Trading and Profit & Loss accounts. These transferred entries are known as Closing entries. All expenses and losses are debited and incomes and gains are credited to Trading, Profit & Loss account.
Problems
Question 1.
Record the Opening entry from the following particulars on 1st April 2013: [Mar. 2019 – T.S.; Mar. 2018 ; May 17 – A.P.]
Cash in Hand — 5,000
Machinery — 20,000
Stock — 10,000
Sundry Debtors — 18,000
Sundry Creditors — 9,000
Furniture — 12,000
Bills Payable — 11,000
Answer:
Journal Proper
Question 2.
Write the Opening entry on 1st Jan. 2013 in the books of Ram from the following:
Rs.
Patents — 8,000
Bills Receivable — 5,000
Machinery — 20,000
Furniture — 10,000
Sundry Debtors — 11,000
Sundry Creditors — 6,000
Bills Payable — 4,000
Bank Overdraft — 2,000
Cash — 7,000
Investments — 5,000
Answer:
Journal Proper
Question 3.
Record the Opening entry from the following assets and liabilities as on Jan. 1st,
Cash at Bank — 13,000
Sundry Debtors — 24,000
Sundry Creditors — 11,000
Investments — 15,000
Buildings — 40,000
Fixtures and Fittings — 12,000
Bills Payable — 8,000
Stock — 20,000
Machinery 30,000
Answer:
Question 4.
Pass Opening Journal Entry from the following particulars on 1st April, 2013.
Rs.
Plant and Machinery — 15,000
Land and Buildings — 25,000
Bank Loan — 10,000
Furniture — 8,000
Debtors — 12,000
Creditors — 14,000
Government Bonds — 6,000
Cash in Hand — 4,000
Answer:
Journal Proper
Question 5.
Record Opening entry on 1st Jan. 2014 from the following assets and liabilities:
Rs.
Trade Marks — 5,000
Machinery — 18,000
Buildings — 26,000
Bills Receivable — 9,000
Bills Payable — 11,000
Sundry Debtors — 12,000
Cash in Hand — 4,000
Sundry Creditors — 7,000
Cash at Bank — 7,000
Loan from Ram — 13,000
Answer:
Journal Proper
Question 6.
Rectify the following errors dated on Dec. 31st, 2013:
1. Machinery purchased Rs. 20,000, wrongly debited to Purchases a/c,
2. Commission received Rs. 3,000, wrongly credited to Interest received a/c,
3. Salaries paid to Accountant Prakash Rs. 10,000, debited to his personal a/c,
4. Purchased goods for Rs. 8,000, recorded as Rs. 80,000,
5. Paid cash to Rohit Rs. 5000, wrongly debited to Mohit a/c.
Answer:
Journal Proper
Question 7.
Pass adjustment journal entries for the following:
1. Salaries Outstanding Rs. 2,000,
2. Insurance Paid in Advance Rs. 500,
3. Credt 5% Reserve for Bad and Doubtful Debts on Debtors amounted to Rs. 10,000,
4. Provide 10% Depreciation on Machinery. Machinery Value Rs. 20,000,
5. Closing Stock Rs. 15,000.
Answer:
Journal Proper
Question 8.
Record the Closing Entries from the following Ledger Balances ofAshrith:
Rs.
Purchases — 14,000
Sales — 46,000
Purchase Returns — 2,000
Sales Returns — 1,000
Opening Stock — 10,000
Wages — 3,000
Salaries — 5,000
Rent Received — 4,000
Commission — 1,500
Discount Allowed — 800
Discount Received — 1,200
Carriage on Purchases — 1,000
Closing Stock — 12,000
Office Expenses — 2,500
Answer:
Journal Proper
Question 9.
Write Opening Entry as on Jan. 1st 2014 from the following balance sheet of Venkat: Balance Sheet of Venkat as on 31st Dec. 2013
Answer:
Journal Proper
Question 10.
Write Opening Journal Entry from the following as on 1st April 2013: [Mar. 2018 T.S.]
Rs.
Debtors — 16,000
Creditors — 12,000
Bills Receivable — 4,500
Bills Payable — 3,000
Furniture — 8,500
Stock — 10,000
Machinery — 25,000
Bank Overdraft — 5,000
Business Premises — 30,000
Answer:
Journal Proper
Question 11.
Record the opening entry from the following particulars on 1st April 2020. [May 2022]
Business Premises — 30,000
Furniture — 8,000
Bank Loan — 10,000
Plant & Machinery — 15,000
Land & Buildings — 25,000
Creditors — 14,000
Debtors — 12,000
Investments — 6,000
Cash in hand — 4,000
Answer:
