Introduction to Accounting — Account STD 11 Commerce — Question

Giving examples, explain each of the following accounting terms:

• Fixed assets
• Revenue
• Expenses
• Short-term liability
• Capital

The following facts were extracted as at 31st December 2014 from the books of Rajesh Dogra who keeps a double column Cash Book:

	₹
Bank balance as per Cash Book (overdrawn)	32,000
Balance as per bank statement (in favour)	24,000

₹ 200 commission charged by bank on outstation cheques yet to be taken into account.
A cheque for ₹ 11,000 paid to Shashi Bhushan wrongly entered in the cash column.
Debit side of Cash Book (bank column) undercast by ₹ 1,000. Cheques received from customers ₹ 10,400 deposited on 31-12-2014 but credited by the bank on 2-1-2015.
Cheques issued to suppliers ₹ 76,600 during 2014 not yet presented for encashment.
Prepare a Bank Reconciliation Statement as at 31-12-2014.

The Cash book of Sh. Shokeen showed a balance of ₹ 20,000 on 31st December, 2023 at the bank. The figure did not agree with the bank Pass Book. A comparison of the two revealed the following :
i. The bank has debited Sh. Shokeen with ₹ 6,000, the annual premium on his life policy according to his standing instructions and with ₹ 150 as bank charges.
ii. The bank has credited Sh. Shokeen by ₹ 15,000, the proceeds of a bill.
iii. Sh. Shokeen sent for collection cheques amounting ₹ 60,000 out of which cheques for ₹ 48,000 have been credited by bank till 31st December.
iv. The cash collection on 31st December, 2023 totalling ₹ 25,000 was entered in the Cash Book in the bank column on the same day but it was banked on the 2nd January, 2024.
v. Sh. Shokeen issued cheques totalling ₹ 1,00,000 of which those of ₹ 36,000 have not been presented by 31st December, 2023.
Show the corrections to be made in the Cash Book so as to ascertain the balance to be shown in the Balance Sheet and then prepare the Bank Reconciliation Statement.

Prepare the trial balance of Mahesh as on 31st March, 2023. He has omitted to opena Capital Account:

	₹		₹
Bank Overdraft	95,000	Purchases	4,45,000
Sales	8,10,000	Cash in Hand	8,500
Purchases Return	22,500	Creditors	2,15,000
Debtors	4,00,500	Sales Return	15,750
Wages	96,000	Equipment	25,000
Capital	?	Opening Stock	3,00,500

Prepare Purchases Return Book of Aruna Stores, Kolkata from the following transactions and post them into Ledger:

What will be the effect of the following on the Accounting Equation?

1. Harish started business with cash ₹ 18,000
2. Purchased goods for Cash ₹ 5,000 and on credit ₹ 2,000
3. Sold goods for cash ₹ 4,000 (costing ₹ 2,400)
4. Rent paid ₹ 1,000 and rent outstanding ₹ 200

Rim Zim Ltd. maintains a current account with the State Bank of India. On 31st March, 2017, the bank column of its cash book showed a debit balance of ₹ 1,54,300. However, the bank statement showed a different balance as on that date. The following were the reasons for the difference:

(i)	Cheques deposited, but not yet credited by the bank	75,450
(ii)	Cheques issued, but not yet presented for payment	80,760
(iii)	Bank charges not yet recorded in the cash book	1,135
(iv)	Cheques received by the bank directly from trade debtors	1,35,200
(v)	Insurance premium paid by the bank as per standing instructions, but not yet recorded in the cash book	15,400
(vi)	Dividend collected by the bank, but not yet recorded in the cash book	1,000

Find out the balance as per the bank statement as on 31st March, 2017.

On 10th January, 2017, A sells goods to B for ₹ 12,000. On that date, B accepted a bill drawn upon him by A at two months for ₹ 12,000. A retains the bill till due date and on due date sends the bill to the Banker for collection. In due course, A receives the information from the Bank that the bill has been duly met.
Pass Journal Entries in the books of A and B.

On 31st December, 2014 the Cash Book of Gopal showed debit balance of ₹ 12,000. On comparing the Cash Book with the Pass Book, the following discrepancies were noted:-

1. Cheques were issued for ₹ 15,000, but of them cheques for ₹ 7,700 have not yet been presented.
2. Cheques for ₹ 8,000 were deposited in bank but of these cheques for ₹ 2,000 were not recorded in the Cash Book.
3. Cheques deposited in bank but not credited ₹ 3,800.
4. A cheque for ₹ 350 was paid into bank but bank credited the amount with ₹ 530 by mistake.
5. Bank received interest on debentures on behalf of Gopal amounting to ₹ 300.
6. It was also found that the total of one page on the payment side of the Cash Book was ₹ 4,520 but it was written on the next page as ₹ 5,420.

Prepare a Bank Reconciliation Statement.

Give any three examples of revenues.