Accounting Rules - Principles Of Accounting
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Decreases in assets
Debit
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Credit
Increases in liabilities & Capital
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Decreases in liabilities & Capital
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Summary of basic double entry transactions
1
Transaction Introduce capital
A/C to be debited Bank/Cash/Asset
A/C to be credited Capital
2 3
Buy asset Sell Asset
Asset Bank/Cash/Asset Debtor
Bank/Cash/Asset Creditors Asset
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4 5
Borrow Money Repay Loan
Bank/Cash Loan
Loan Bank/Cash
6 7
Owner’s Drawings Receive Income
Drawings Bank/Cash
Bank/Cash/Purchases Individual income
Yes Bank NRI Banking
8 9
Pay Expenses Withdraw money for office use
Individual expense Cash
Bank/Cash Bank
10 11
Pay cash into bank Buy stock/goods for resale
Bank Purchases
Cash Bank/Cash/ Creditor
12 13
Return stock/goods to supplier Sell business stock/goods
Bank/Cash/Creditor Bank/Cash/Debtor
Purchases Returns Sales
14 15
Stock /goods returned by customer Payment to creditor
Sales Returns Creditor
Bank/Cash/Debtor Bank/Cash
16 17
Receipt from debtor Carriage on purchases
Bank/Cash Carriage Inwards
Debtor Bank/Cash/Creditor
18 19
Carriage on sales Discount to customers
Carriage Outwards Discount Allowed
Bank/Cash Debtor
20 21
Discount from supplier Write off bad debt
Creditor Bad debts
Discount Received Debtor
Excel to Tally
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Account to be Debited and Account to be Credited Q1. From the following transactions prepare account to be debited and account to be credited. (a) Started business with Cash $ 40,000 (b) Started business with Bank $ 30,000 (c) Started business with Land and Building $ 60,000 (d) Started business with Furniture and Fittings $ 50,000 (e) Started business with Motor Car $ 50,000
Q2. From the following transactions prepare account to be debited and account to be credited. (a) Started business with Cash $ 50,000
http://principlesofaccounting2.com/ http://principlesofaccounting2.com/ (b) Bought goods for cash $ 5,000 (c) Sold goods for cash $ 7,000
(d) Purchased goods for cash $ 10,000 (e) Goods sold for cash $ 15,000
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Q3. From the following transactions prepare account to be debited and account to be credited. (a) Started business with Cash and Bank $ 40,000 and $ 50,000 respectively (b) Bought goods for cash $ 10,000 (c) Sold goods and received by cheque $ 12,000 (d) Goods purchased and paid by cheque $ 7,000 (e) Goods sold for cash $ 5,000
Q4. From the following transactions prepare account to be debited and account to be credited.
http://principlesofaccounting2.com/ http://principlesofaccounting2.com/ (a) Purchased Land and Building $ 1,00,000 (b) Bought Motor van for cheque $ 20,000 (c) Sold the old Furniture $ 500 (d) Plant and Machinery purchased for $ 25,000 (e) Sold Motor cycle for cash $ 1,000
Q5. From the following transactions prepare account to be debited and account to be credited (a) Rent paid by cash $ 2,000 (b) Paid Salaries by cash $ 10,000 (c) Telephone charges paid by cash $ 1,000 (d) Paid Electricity charges by cash $ 1,500 (e) Paid Stationary by cash $ 500
Q6. From the following transactions prepare account to be debited and account to be credited. (a) Paid Insurance by cheque $ 2,000 (b) Paid Staff Welfare Fund by cheque $ 1,000
/ http://www.principlesofaccounting2.com/ (c) Paid Salaries of employees by Cheque $ 20,000 (d) Telephone charges paid by cheque $ 3,000 (e) Paid Rent by cheque $ 2,000
Q7. From the following transactions prepare account to be debited and account to be credited. (a) Received Commission by cash $ 3,000 (b) Interest received by cash $ 2,000 (c) Salary received by cash $ 5,000 (d) Incentives received by cash $ 1,000 (e) Received Dividend by cash $ 500 Q8. From the following transactions prepare account to be debited and account to be credited. (a) Bought goods on credit from Lal Chand $ 10,000 (b) Sold goods to Azhar $ 15,000 (c) Purchased goods on credit from Sonia $ 2,000 (d) Goods sold for credit to Zaheer $ 5,000 (e) Bought goods from Shilpa $ 4,000 (f) Sold to Saleem $ 3,000
Q9. From the following transactions prepare account to be debited and account to be credited. (a) Received cash from Sultan $ 3,000 (b) Paid cash to Smith $ 2,000 (c) Received cash from Pollock $ 5,000 (d) Paid cash to Rahul $ 6,000 (e) Received cash from Sony $ 10,000
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Q10. From the following transactions prepare account to be debited and account to be credited. (a) Paid Cheque to Dravid $ 5,000
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(b) Received cheque from Lara $ 10,000 (c) Paid cheque to Simon $ 15,000 (d) Received cheque from Jack $ 5,000 (e) Paid cheque to Lee $ 7,000
Q11. From the following transactions prepare account to be debited and account to be credited. (a) Stalin bought goods from us $ 5,000 (b) Bought goods from Stella $ 3,000 (c) Sold goods to Black well $ 9,000
http://principlesofaccounting2.com/ http://principlesofaccounting2.com/ (d) Bought goods from Tony $ 15,000 (e) Tiny sold goods to us $ 10,000
Q12. From the following transactions prepare account to be debited and account to be credited. (a)Started business with cash $2,500 (b)Bought goods by cash $12,000 (c)Sold goods for cash $20,000 (d)Paid carriage inwards in cash $1,500 (e)Received commission in cash $1,000
Q13. From the following transactions prepare account to be debited and account to be credited. (a)Bought goods for cheque $ 2,000 (b)Sold goods for cheque $ 3,000 (c)Bought furniture in cash $1,200 (d)Sold machinery for cash $12,000 (e)Returned goods to Ahmed $100
/ http://www.principlesofaccounting2.com/ Q14. From the following transactions prepare account to be debited and account to be credited (a)Alwin returned goods to us $250 (b)Bought goods on credit from Sathya $1,500 (c)Sold goods on credit to Samuel $1,800 (d)Issued a cheque to Mathew for $ 2,800 (e)Paid travelling expenses in cash $25
Q15. From the following transactions prepare account to be debited and account to be credited (a)Returned furniture to Sunil $2,000 (b)Alfred issued a cheque to us $ 600 (c)Withdrew cash from the business for personal use $120 (d)Withdrew cash from the business bank account for personal use $1,250 (e)Cash sales deposited into business bank account $ 2,500
Q16. From the following transactions prepare account to be debited and account to be credited (a)Anand deposited cash in our bank account $ 4,000 (b)Paid cash to Sabig for the settlement of his account $1,000 (c)Raasi settled his account by cheque $1,400 (d)Introduced additional capital into the business $3,000 by cheque (e)Paid rent of building by cheque $600 (f)Received Interest in cash $5,000
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Q 17. From the following transactions prepare account to be debited and account to be credited a. Started business with cash $ 5 000
b. Deposited cash in the bank account $ 3 000
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c. Bought goods on credit from Samson for $ 2 000 d. Sold goods on credit to Ramson for $ 2 500 e. Purchased a motor car from Universal Motors on credit for $ 3 500 f. Bought furniture for $ 500 and paid by cheque g. Paid Universal Motors by cash h. Received cheque from Ramson for $ 1 500 i. Paid office expenses in cash $ 100 j. Received commission from Tom by cheque $ 250
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Q 18. From the following transactions prepare account to be debited and account to be credited a. Started business with cash $ 20 000
b. Deposited cash into bank account $ 10 000 c. Purchased goods on credit from B. Blue $ 8 000 d. Credit sales to Y. Yellow $ 12 000 e. Paid salaries by cheque $ 500 f. Bought fittings by cash $ 1000 g. Paid B. Blue by cash $ 5 000 h. Received a cheque from Y. Yellow $ 8 000 i. Withdrew $ 300 from the bank for personal use j. Took $ 1 000 from the cash till and put into bank Q 19. From the following transactions prepare account to be debited and account to be credited a. Started business with $ 2 000 in cash. b. Paid $ 1 800 of the opening cash into the bank account for the business. c. Bought office furniture on credit from Better Furniture for $ 120. d. Bought a motor van paying by cheque $ 150.
/ http://www.principlesofaccounting2.com/ e. Bought works machinery from Evansons on credit $ 160.
f. Returned faulty furniture costing $ 62 to Better Furniture. g. Sold some of the works machinery for $ 75 cash. h. Paid amount owing to Better Furniture $ 58 by cash. i. Took $ 100 out of bank and put it in cash till. J. J. Smith lent us $ 500- Giving us money by cheque.
Q 20. From the following transactions prepare account to be debited and account to be credited a. Started business with cash $ 2 000. b. Received a loan of $ 5 000from Micky by cheque. c. Bought machinery for cash $ 200. d. Bought office equipment on credit from Goodview Ltd. For $ 800. e. Took $ 300 out of bank and put it into the cash till. f. Repaid part of Micky’s loan by cheque $ 2 000. g. Paid amount owing to Goodview Ltd. $ 800 by cheque. h. Repaid part of Micky’s loan by cash $ 500. i. Bought additional machinery on credit from Donald for $ 1 500. Q. 21.
Based on the following transactions, find out the Account to be debited and Account to be credited.
a)
Started business with cash $2,500
b)
Bought goods by cash $12,000
c)
Sold goods for cash $20,000
d)
Paid carriage inwards in cash $1,500
e)
Received commission in cash $1,000
f)
Bought goods for cheque $ 2,000
g)
Sold goods for cheque $ 3,000
h)
Bought furniture in cash $1,200
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Accounting Rules - Principles Of Accounting
i)
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Sold machinery for cash $12,000
j)
Returned goods to Ahmed $100
k)
Alwin returned goods to us $250
l)
Bought goods on credit from Sathya $1,500
m)
Sold goods on credit to Samuel $1,800
n)
Issued a cheque to Mathew for $ 2,800
o)
Paid travelling expenses in cash $25
p)
Returned furniture to Sunil $2,000
q)
Alfred issued a cheque to us $ 600
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Withdrew cash from the business for personal use $120
s)
Withdrew cash from the business bank account for personal use $1,250
t)
Cash sales deposited into business bank account $ 2,500
u)
Anand deposited cash in our bank account $ 4,000
v)
Paid cash to Sabig for the settlement of his account $1,000
w)
Raasi settled his account by cheque $1,400
x)
Introduced additional capital into the business $3,000 by cheque
y)
Paid rent of building by cheque $600
z)
Received Interest in cash $5,000
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