General Ledger Problems and Solutions
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Problems 1:
Creative Advertising, owned by Miss Abida Masood, provides advertising consulting services. During January 2011, the following events occurred:
Jan. 2 Owner contributed Rs. 50,000 and a new computer costing Rs. 20,500 to start her business.
Jan. 4 Office supplies were purchased on account for Rs. 4,000.
Jan. 10 Creative Advertising obtained 12% 5-year loan of Rs. 20,000 from the bank.
Jan. 12 Creative Advertising paid the utility bills for Rs. 2,750.
Jan. 15 Paid the Rs. 3,000 in Accounts Payable from the purchase of office supplies on Jan. 4.
Jan. 24 Advertising services completed in January were billed to clients Annies’ Flowers at Rs. 18,300.
Jan. 27 Creative Advertising received Rs. 5,500 from Annies’ Flowers, a client, as payment on account.
Jan. 30 Miss Abida Masood withdrew Rs. 6,000 of cash for personal use.
Requirement: Your are required to pass Journal Entry, post to appropriate general ledger account and make a trial balance?
Solution: Journal Entry
>> See more Journal Entry Examples
Solution: General Ledger and Trial Balance
>> Read General Ledger chapter.
Problem 2:
Shah Garden Center is retail garden supplier. Record the transactions needed to journalize, post to respective ledger account and prepare Trial Balance of the following for October, 2011 of the current year:
Oct. 2 Purchased inventory on credit terms of 1/10 net 30. FOB shipping point, for Rs. 3,000. Freight charges on the purchase were Rs. 150.
Oct. 9 Sold garden supplies on credit terms 3/20 net 30, FOB shipping point, for Rs. 4,000. The cost of the supplies sold was Rs. 2,500.
Oct. 10 Paid the amount owed on account for the Oct. 2 inventory purchase.
Oct. 15 Received merchandise that was returned as defective, originally sold for Rs. 500 on Oct. 9. The original cost of the supplies returned was Rs. 275.
Oct. 25 Received payment on account for the Oct. 9 sale less the appropriate sales discount.
Oct. 28 Inventory lost by fire of cost Rs. 350.
Solution: Journal Entry
Solution: General Ledger and Trial Balance
>> Practice Journal Entry Problems and Solutions for better understanding of General Ledger Problems and Solution.
Problem 3:
Record following transaction in T accounts directly?
Solution: Directly Recording in T Accounts
>> Practice General Ledger Mcqs for conceptual understanding of General Ledger.
Problem 4:
Post transactions to appropriate T-account & make Trial Balance for ABC Ltd as on June 30th, 2008:
- Owner investment in Cash Rs. 10,000
- Borrowing Rs. 1,000 from a local bank on a Note due in three months
- Purchase Equipment of Rs. 500, paid Rs. 100 Cash and promising the rest on a Note Payable
- Paid Rs. 150 for Stationery
- Lent Rs. 200 to an employee who signed a Note promising to repay within 60 days
- Service Revenue received during the period is Rs. 5,800
- Paid Insurance for three year at start of this accounting period Rs. 1,800
- Service Revenue of worth Rs. 1,200 earned but not received
- Insurances expired recorded as Insurance Expense of Rs. 600
- Personal withdrawal of owner of Rs. 700
General Ledger Format Download
Solution: Ledger and Trial Balance
>> Basic Practice for Accounting Equation Problems and Solutions.
Problem 5:
Post transactions to appropriate T-account & make Trial Balance with Totals and Trial Balance with Balances and Totals for ABC Ltd as on March 30th, 2008:
Ahmed Bajwa, an interior decorator, completed the following transactions during the month of March 2008.
- Begun his business with Equipment valued at Rs. 80,000 and placed Cash Rs. 100,000 in a business Bank Account.
- Purchase a used Motor Car costing Rs. 50,000 and paid by check.
- Completed painting a two-story house and billed the customer, Rs. 24,800 (Account Receivable Dr).
- Received cash for painting two rooms, Rs. 5,000. It was kept in cash till.
- Hired assistant to work with him, to be paid Rs. 100 per day.
- Purchase supplies for Rs. 14,600 and paid by check.
- Paid assistant for six days work, Rs. 600 in Cash.
- Received cheque for painting five room apartment Rs. 33,600 and check is not deposited.
- Transfer Rs. 2,000 to Business Bank Account.
Solution: Ledger and Trial Balance
>> Read Books of Accounts chapter.
Related Questions
General Ledger Questions
Related Problems
General Ledger Exam Questions
General Ledger Exercises
References
Ramchandran, N., & Kakani, R. K. (2007). Financial Accounting for Management. (2nd, Ed.) New Delhi: Tata McGraw Hill.
Sehgal, A., & Sehgal, D. (n.d.). Advanced Accountancy (Vol. I & II). New Delhi: Taxmann Publication Pvt. Ltd.
Shukla, M. C., Grewal, T. S., & Gupta, S. C. (2008). Advanced Accountancy (Vol. I & II). New Delhi: S Chand & Co.
Weygandt, J. J., Kimmel, P. D., & Kieso, D. E. (2012). Accounting Principles (10th ed.). Hoboken: John Wiley & Sons, Inc.
Williams, M., & Bettner, H. (1999). Accounting (The basic for business decisions). (11th, Ed.) USA: Irwin McGraw- Hill.
The discount amount wasn’t mentioned in question no 2. why did you allot rs50 to the discount?
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in problem 2 (General journal) answer is 27425 how??? any one explain little bit
please i want to know why we used the total account receivable amount to calculate the discount allowed and not the supplies amount
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Up
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What is the difference between chart of accounts and general ledger?
General ledger is a book of secondary entry, while chart of account is a list containing accounts, and its account number.
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