subsidarry books - I Accountancy - subsidarry books - I

Closing entries are recorded in ……………..

Which of the following statements is not true?

The source document or voucher used for recording entries in sales book is ……………..

Purchases of fixed assets on credit basis is recorded in ……………..

Sales return book is used to record ……………..

Mention the subsidiary books in which the following transactions are recorded

1. Sale of goods for cash
2. Sale of goods on credit
3. Purchases of goods on credit
4. When the proprietor takes goods for personal use
5. Goods returned to suppliers for which cash is not received immediately
6. Asset purchased as credit.

Give the format of purchases book.

What is an invoice?

What is an opening entry?

Define bill of exchange.

Write short notes on: Endorsement of a bill and Discounting of a bill

Enter the following transactions in the purchases and sales books of Kannan, an automobile dealer, for the month of December, 2017.
Dec. 1 Bought from Sumathi on credit ₹ 17,800
Dec. 4 Sold goods to Rani on credit ₹ 15,200
Dec. 6 Purchased goods on credit from Mani ₹ 7,000
Dec. 10 Sold goods on credit to Saranya ₹ 12,500
Dec. 17 Sold goods to Hussain on credit ₹ 13,250
Dec. 21 Purchased goods on credit from Raghunathan ₹ 10,000
Dec. 26 Sold goods to Shyam for cash ₹ 3,000

Enter the following transactions in the Sales book of Kamala Stores, a furniture shop.
2017:

1. May 2 – Sold to Naveen Stores, Trichy on credit 5 computer tables @ ₹ 1,750 per table
2. May 9 – Sold to Deepa & Co., Madurai on credit 6 dining tables @ ₹ 1,900 per dining table
3. May 15 – Sold to Rajesh 10 dressing tables @ ₹ 2,750 each on credit
4. May 24 – Sold to Anil 5 wooden tables @ ₹ 1,250 per table on credit
5. May 27 – Sold to Gopi 3 old computers @ ₹ 3,500 each
6. May 29 – Sold 50 chairs to Anil @ ₹ 275 each for cash

From the following transactions write up the Sales day book of M/s. Ram & Co., a stationery merchant.
2017:

1. Jan. 1 – Sold to Anbu & Co., on credit 20 reams of white paper @ ₹ 150 per ream
2. Jan. 2 – Sold to Jagadish & Sons on credit 6 dozen pens @ ₹ 360 per dozen
3. Jan. 10 Sold old newspapers for cash @ ₹ 620
4. Jan. 15 – Sold on credit M/s. Elango & Co., 10 drawing boards @ ₹ 170 per piece
5. Jan. 20 – Sold to Kani & Co., 4 writing tables at ₹ 1,520 per table for cash

Enter the following credit transactions in the purchases book of Manoharan, a Provisions Merchant.
2017:

1. May 2 – Bought from Vasu 100 bags of rice @ ₹ 800 per bag
2. May 8 – Bought from Cheyyar Sugar Mills Ltd., 20 bags of sugar @ ₹ 2,600 per bag
3. May 10 – Bought from Ram Flour Mill, Coimbatore, 10 bags of wheat flour @ ₹ 750 per bag
4. May 15 – Bought from Nilgiri Tea Co., Nilgiris, 15 cases of tea @ ₹ 900 per case
5. May 25 – Bought from Sairam Coffee Works Ltd., 100 kgs of Coffee @ ₹ 190 per kg.
6. May 29 – Bought from X & Co. furniture worth ₹ 2,000

Mr. Joseph started a trading business of selling readymade clothes. In the earlier period, he dealt only with cash, because he felt that would be risk-free. But, later on, he had to give credit period for his regular customers in order to retain them. For some customers, when they made bulk purchase, he offered them some discount. That brought him even more customers. But, some of his customers are not prompt in making the payment.
He expanded his business and employed few staff. As the credit transactions were numerous, he found it difficult to maintain properly. One of his friends, who is a Chartered Accountant advised him to maintain subsidiary books.
Discuss on the following points.
What could be the reason for Joseph’s feeling that dealing in cash is risk free?
What type of discount is offered by Joseph?
Suggest some ways to Joseph for making his customers to pay on time.
Do you think that maintaining the subsidiary books will be useful to Joseph?
What business documents are needed to maintain the subsidiary books?

What are the advantages of subsidiary books?

From the following information, prepare the necessary subsidiary books for Nalanda Book Stores.
2017:
Dec. 1 – Bought from M/s. Umadevi on credit
100 copies of Business Statistics Book @ ₹ 80 each
100 copies of Accountancy Book @ ₹ 150 each
Dec.7 – Sold to Sridevi & Co., on credit
240 copies of Business Statistics @ ₹ 90 each
250 copies of Accountancy books @ ₹ 170 each
Dec. 10 – Bought from Subha & Co.,
40 copies of Economics Books @ ₹ 80 each
Less: 15% Trade Discount
Dec. 15 Returned to M/s. Uma Devi 10 copies of damaged Accountancy book for which cash is not received
Dec. 18 Sold to Gupta Bros., on credit
200 copies of Economics book @ ₹ 95 each
Dec. 26 Returned 6 copies of Economics books to Subha & Co.,

Record the following transactions in the sales book and sales returns book of M/s. Ponni & Co., and post them to ledger.
2017:

1. Aug. 1 – Sold goods to Senthil as per Invoice No. 68 for ₹ 20,500 on credit
2. Aug. 4 – Sold goods to Madhavan as per Invoice No. 74 for ₹ 12,800 on credit
3. Aug. 7 – Sold goods to Kanagasabai as per Invoice No. 78 for ₹ 7,500 on credit
4. Aug. 15 – Returns inward by Senthil as per Credit Note no. 7 for ₹ 1,500 for which cash is not paid
5. Aug. 20 – Sold goods to Selvam for ₹ 13,300 for cash
6. Aug. 25 – Sales returns of ₹ 1,800 by Madhavan as per Credit Note No. 11 for which cash is , not paid