Question
Rectify the following errors:
  1. The Sales Book has been totalled ₹ 1,000 short.
  2. Goods worth ₹ 1,500 returned by Green and Co. have not been recorded anywhere.
  3. Goods purchased worth ₹ 2,500 have been posted to the debit of the supplier, Gupta and Co.
  4. Furniture purchased from Gulab and Co. worth ₹ 10,000 has been entered in Purchases Day Book.
  5. Cash received from A ₹ 2,500 has not been posted in his account.

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From the following balances, taken from the books of $M / s$ Dhruv Rathee \& Sons as at 31st March 2023, prepare a Trial Balance in proper form:

Name of Accounts

(₹)

Name of Accounts

(₹)

Cash in Hand

4,500

Machinery

24,000

Bank Overdraft

8,000

Land & Buildings

50,000

Opening Stock

20,000

Debtors

18,400

Purchases

80,000

Creditors

8,500

Purchases Returns

2,000

Bills Receivable

2,850

Sales

1,30,000

Bills Payable

1,650

Sales Returns

5,000

Capital

60,000

Travelling Expenses

1,800

Drawings

6,000

Discount Allowed

600

Rent

3,700

Discount Received

1,500

Salaries

3,600

 

 

Loan (Cr.)

10,000

 

 

Interest on Loan

1,200

Prepare a Trial Balance with the following information:

Note: For Delhi 2011, figures given above have been reduced to half, hence the total of the Trial Balance will be ₹ 3,75,000, in that situation.
“Capital is a liability for the business." Explain this statement with the principle applied.
Record the following transactions in Double Columns Cash Book and balance the book on 31st March, 2019:
2019
 
March 1
Cash in Hand
12,750
 
Cash at Bank
72,400
March 4
Received from Asha cash ₹ 1,200 and a cheque for ₹ 3,200, allowed discount ₹ 400
 
March 7
Paid salary to staff by cheque
25,600
March 9
Withdrawn cash from bank for office use
21,900
March 12
Interest paid by bank on bank balance
1,200
March 16
Purchased furniture in cash
16,500
March 21
Paid Mohan & Co. by cheque, discount received ₹ 100
10,900
March 24
Proprietor withdrew from office cash for his personal use
11,600
March 29
Sold goods to Manoj for cash
14,800
March 31
Deposited office cash into bank
21,200
Prepare accounting equation from the following:
  1. Started a business with cash ₹ 1,00,000 and goods worth ₹ 20,000.
  2. Sold 50% of above goods at a profit of ₹ 2,000 on credit to Ram.
  3. Rent paid ₹ 5,000.
  4. Ram paid 50% of his balance in cash.
A Limited purchased a machine on 1st July 2011 for ₹ 3,00,000 and on 1st January 2013 bought another machinery for ₹ 2,00,000. On 1st August 2013 machine bought in 2011 was sold for ₹ 1,60,000. Another machine was bought for ₹ 1,50,000 on 1st October 2013. It was decided to provide depreciation @ 10% p.a. on written down value method assuming books are closed on 31st March each year. Prepare Machinery Account and Provision for depreciation account for 3 years.
Write a note on the following:
  1. Dishonour of Bill.
  2. Endorsement of Bill.
Prepare the Accounting Equation on the basis of the following:
  1. Started business with cash ₹ 1,40,000 and Stock ₹ 2,50,000.
  2. Sold goods (costing ₹ 50,000) at a profit of 25% on the cost.
  3. Deposited into bank account ₹ 1,80,000.
  4. Purchased goods from Mohan ₹ 80,000.
Explain how the following transactions would be recorded in a Cash Book with Cash and Bank Columns?
Dishonour of cheques deposited into Bank.
Explain the meaning of any three of the following terms:
  1. Liability.
  2. Stock.
  3. Business Transaction.
  4. Drawings.