JOURNALISING RULES FOR THE GROUPSEvery transaction has minimum two aspects, viz. Debit Aspect and Credit Aspect. The following rules are followed to find out the debit and credit aspects.
Personal Accounts : Debit the Receiver Credit the Giver
Real Accounts : Debit what comes in Credit what goes out
Nominal Accounts : Debit all Expenses and losses Credit all Incomes and Gains
ExampleSalary paid Rs.2,000/-
In this example, the two aspects are ‘Salary’ and ‘Cash’. Salary is a Nominal Account and Cash is a Real Account. Let us apply the rules relating to Nominal Account and Real Account.
‘Expenses and Losses’ are Debit Aspects and so Salary A/c is to be debited.
Credit what goes out. Cash is paid and going out. So, Cash A/c should be credited.
Journal Entry Format
|Salary A/c Dr (Debit aspect)||2000|
|To Cash A/c (Credit asp ect)||2000|
|(Being Salary paid)|
Exercise 11. Akash invested Capital Rs.10000.
2. Cash deposited into Bank Rs.20000.
3. Cash withdrawn from Bank Rs.10000.
4. Salary paid Rs.5000.
5. Wages paid Rs.6000.
6. Rent received Rs.3000.
7. Discount allowed Rs.1000.
8. Cheque issued to Rajan Rs.6000.
Exercise 21. Sale of goods Rs.2000.
2. Purchase of goods Rs.6000.
3. Credit Sales to Ramesh Rs.5000 & Cash sales of Rs.1000.
4. Credit purchase of Rs.6000 from Akash& Cash Purchase of Rs.2000 were made.
5. Returned goods from sale Rs.1000.
6. Returned goods from purchase Rs.2000.
7. Purchase of Land Rs.5000.
Exercise 31. Bills receivable from Kumar Rs.10000.
2. Additional Capital invested for Rs.100000.
3. Bills payable Rs.20000 to Prasad.
4. Loan from HDFC Rs.60000.
5. Bad debts written off Rs.600 to Mani.
Exercise 4Prepare Trial Balance from the following Balances of ABC & Co. as on 31/3/95.
|P A R T I C U L A R S||P A R T I C U L A R S|
|C a p i t a l||4 1 , 0 0 0||D i s c o u n t A l l o w e d||1 , 2 0 0|
|D r a w i n g s||2 , 0 0 0||S a l e s||5 5 , 0 0 0|
|M a c h i n e r y||2 0 , 0 0 0||F r e i g h t||1 , 3 0 0|
|F u r n i t u r e||1 , 5 0 0||I n s u r a n c e||800|
|B a n k||1 8 , 2 0 0||P r i n t i n g a n d S t a t i o n e r y||675|
|C a s h||750||B i l l s R e c e i v a b l e||3 , 4 0 0|
|R a t e s a n d Ta x e s||1 , 1 0 0||B i l l s P a y a b l e||1 , 6 0 0|
|O p e n i n g S t o c k||1 7 , 0 0 0||P u r c h a s e R e t u r n s||1 , 7 0 0|
|D e b t o r s||3 8 , 0 0 0||C o m m i s s i o n R e c e i v e d||925|
|C r e d i t o r s||4 5 , 0 0 0||S a l e s R e t u r n s||1 , 0 0 0|
|P u r c h a s e s||3 0 , 0 0 0||S a l a r i e s||8 , 3 0 0|