Work Book Unit 2 (Solved)

Learning Objectives To know the account variation by using Variation Proforma

The safest way to double your money is to fold it over and put it in your pocket. Kin Hubbard
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Unit 2

VP # 2.1
S.No 1 2 3 4 5 6 7 8 9 10 11 Transactions Ali Started business with Cash Rs. 100,000 Purchases goods by Cash Rs. 5,000

Variation Proforma for Journal Entries

Chart of Accounts Cash Owner Equity Purchases Cash Cash Bank Loan Furniture Account Payable Wages Cash Account Receivable Credit Sales made of worth Rs. 17,000 Sales Prepaid Rent Cash Drawing Furniture Cash Cash Sales of worth Rs. 11,000 Sales Purchases Account Payable Account Receivable Sales Accounting Pillars Asset Owner Equity Expense Asset Asset Liability Asset Liability Expense Asset Asset Revenue Asset Asset Drawing Asset Asset Revenue Expense Liability Asset Revenue Reasons Increase Increase Increase Decrease Increase Increase Increase Increase Increase Decrease Increase Increase Increase Decrease Increase Decrease Increase Increase Increase Increase Increase Increase 14,000 14,000 2,000 2,000 11,000 11,000 500 500 15,000 15,000 17,000 17,000 1,000 1,000 3,000 3,000 50,000 50,000 5,000 5,000 Debit 100,000 100,000 Credit

Borrowing money as Bank Loan of Rs. 50,000 Bought Furniture on Account Rs. 3,000 Paid Wages of Rs. 1,000 to daily basis worker

Paid Three year Rent in Advance Rs. 15,000 Owner withdraw Furniture of Rs. 500

Bought Merchandise from Ahmed Rs. 2,000 Accrued Revenue worth Rs. 14,000

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Variation Proforma for entries (Solved)

Unit 2

VP # 2.2
S.No 1 2 3 4 5 6 7 8 9 10 11 Transactions Cash received from Customer Rs. 6,000 Unpaid Salaries for December of worth Rs. 2,200

Variation Proforma for Journal Entries

Chart of Accounts Cash Account Receivable Salaries Salaries Payable Rent Prepaid Rent Account Payable Cash Depreciation Accumulated Dep. Bank Cash Free Sample Purchases Cash Discount Bank Loan Cash Commission Cash Cash Furniture Accounting Pillars Asset Asset Expense Liability Expense Asset Liability Asset Expense C. Asset Asset Asset Expense Expense Asset Revenue Liability Asset Expense Asset Asset Asset Reasons Increase Decrease Increase Increase Increase Decrease Decrease Decrease Increase Decrease Increase Decrease Increase Decrease Increase Increase Decrease Decrease Increase Decrease Increase Decrease 1,800 1,800 800 800 10,000 10,000 100 100 300 300 7,000 7,000 2,500 2,500 1,500 1,500 5,000 5,000 2,200 2,200 Debit 6,000 6,000 Credit

One year Rent has been expired of Rs. 5,000 Paid to Creditor of Rs. 1,500 Charged Rs. 2,500 as Depreciation to Machinery by cost method Deposited Rs. 7,000 to Bank Goods Distributed as Free Sample Rs. 300 Received Cash Discount worth of Rs. 100 Retired Bank Loan of Rs. 10,000 Paid Commission to employee Rs. 1,800 Business Furniture sold on Cash Rs. 800

15

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Variation Proforma for entries (Solved)

Unit 2

VP # 2.3
S.No

Variation Proforma for Journal Entries

Transactions
Charts of Accounts Accounting Pillars Reasons Debit Credit

Cash 1 Khawar Mughal invested in his business Rs. 104,000 in cash and building worth Rs. 246,000 2 3 4 5 6 7 8 Purchased Equipments Rs. 31,500 on cash Purchased electrical Compressor for Rs. 47,750 from modern Electric store Sold merchandise Rs. 21,700 to Ali Malik Paid Miscellaneous Exposes of Rs. 13,245 Purchased electric typewriter for business use Rs. 21,000 Purchased papers, files ribbons and carbon papers etc. Rs. 1,235on account Rented a portion of the shop and received rent Rs. 2,000 Building Owner Equity Equipments Cash Electric Compressor A/c Payable A/c Receivable Sale M. Expenses Cash Typewriter Cash Office Stationery A/c Payable Cash Rent A/c Payable 9 Paid cash to modern Electric store Rs. 7,245 and wages Rs. 100 Wages Cash

Asset Asset Owner Equity Asset Asset Asset Liability Asset Revenue Expense Asset Asset Asset Expense Liability Asset Revenue Liability Expense Asset

Increase Increase Increase Increase Decrease Increase Increase Increase Increase Increase Decrease Increase Decrease Increase Increase Increase Increase Decrease Increase Decrease

104,000 246,000 350,000 31,500 31,500 47,750 47,750 21,700 21,700 13,245 13,245 21,000 21,000 1,235 1,235 2,000 2,000 7,245 100 7,345

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Variation Proforma for entries (Solved)

Unit 2

VP # 2.4
S.No Transaction

Variation Proforma for Journal Entries

Chart of Accounts Bank Owner Equity Purchases A/c Payable A/c Payable Purchases Return Purchases Cash Bank Cash Machinery Bank A/c Receivable Sales Sales Returns A/Receivable Cash Purchases Return Machinery Accounting Pillars Asset Owner Equity Expense Liability Liability C. Expense Expense Asset Asset Asset Asset Asset Asset Revenue C. Revenue Asset Asset C. Expense Asset Liability Reasons Increase Increase Increase Increase Decrease Decrease Increase Decrease Increase Decrease Increase Decrease Increase Increase Decrease Decrease Increase Decrease Increase Increase 270 270 30 30 140 140 220 220 550 550 300 300 190 190 40 40 900 900 Debit 2,000 2,000 Credit

Started business with Rs. 2,000 in the bank

Bought goods on credit from C. Shaw Rs 900

We returned goods to C. Shaw Rs. 40

Bought goods by cash from F. Mills Rs. 190

Took Rs. 300 of cash and deposit it into the bank.

Bought machinery by check Rs. 550

Sold goods on credit to L. Peter Rs. 220

G. wood returned goods to us Rs 140 a credit customer.

We returned goods to Ali Rs. 30 which was purchased by cash

10

Bought Machinery on credit from D. Lee Rs 270 A/c Payables

17

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Variation Proforma for entries (Solved)

Unit 2

VP # 2.5
S.No

Variation Proforma for Journal Entries

Transactions
Account Title Involved Cash Accounting Pillars Asset Owner Equity Liability Asset Asset Liability Asset Asset Revenue Asset Revenue C. Revenue Assets Expense Expense Expense Expense Assets Drawing Asset Assets Assets Owner Equity Reasons Increase Increase Increase Increase Decrease Increase Increase Increase Increase Increase Increase Decrease Decrease Increase Increase Increase Increase Decrease Increase Decrease Increase Increase Increase Debit 70,000 50,000 20,000 10,000 7,000 3,000 2,000 10,000 12,000 25 25 500 500 450 150 200 100 900 2,400 2,400 10,000 1,000 11,000 Credit

X commenced business with Cash Rs. 50,000 and Bank 1 Loan Rs. 20,000 Owner Equity Bank Loan Furniture Cash Note Payable A/c Receivable Cash Sales Cash Commission Sales Return A/c Receivable Transportation Carriage Wages Taxes Cash Drawing Cash Cash Furniture Owner Equity

Purchased furniture of worth Rs. 10,000 in which Rs. 7,000 by cash and 3,000 by issuing Note Payable to ABC Co. Sold goods on of worth Rs. 12,000. Rs. 2,000 related to credit and Rs. 10,000 of cash sales Received commission of Rs. 25 Sales returned by customer of Rs. 500 and reduced Account Receivable Paid Transportation Expense Rs. 450, Carriage Expense Rs.

4 5

150, Wages Expense Rs. 200 and Taxes Rs. 100

X withdrew from business for personal use Rs. 2,400 Further invested by owner in the shape of cash Rs. 10,000 and furniture Rs. 1,000

18

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Variation Proforma for entries (Solved)

Unit 2

VP # 2.6
S.No 1

Variation Proforma for Journal Entries

Transactions
Chart of Accounts Cash Accounting Pillars Asset Owner Equity Purchases Cash Computer Cash A/c Receivable Sales Purchases A/c Payable Cash Discount A/c Receivable A/c Payable Cash Discount Iron safe Cash Rent Owner Equity Expense Asset Asset Asset Asset Revenue Expense Liability Asset Expense Asset Liability Asset Revenue Asset Asset Expense Cash Asset Reasons Increase Increase Increase Decrease Increase Decrease Increase Increase Increase Increase Increase Increase Decrease Decrease Decrease Increase Increase Decrease Increase Decrease 100 100 1,850 1,850 300 290 10 900 100 1,000 300 300 1,000 1,000 2,000 2,000 300 300 Debit 10,000 10,000 Credit

Commenced business with cash Rs.10,000 Bought merchandising for cash Rs.300 Bought computer for cash Rs. 2,000 Sold goods to Nasir Rs.1,000 Purchased goods from Salman & co. Rs.300 Received from Nasir Cash Rs.900 after allowed him Discount

2 3 4 5

Rs.100

Paid Salam & co, CashRs.290 after received Discount Rs.10

10

Bought Iron safe for cash Rs. 1,850

11

Paid Rent Rs.100

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Variation Proforma for entries (Solved)

Unit 2

VP # 2.7
S.No

Variation Proforma for Journal Entries

Transactions
Chart of Accounts Cash Accounting Pillars Asset Asset Asset Owner Equity Purchased merchandise on account Rs. 12,000 and by cash Purchases A/c Payable Cash Carriage Paid carriage on purchases Rs. 250 and salaries payable Salaries Cash Salaries Payable Payment made to Ali and brother Rs. 11,800 receiving A/c Payable Cash Discount Loan taken from the HBL of Rs. 55,000 and retained in Bank Bank Loan Cash Owner Equity Salaries Electricity Bill Cash Owner Equity Expense Liability Asset Expense Expense Asset Liability Liability Asset Revenue Assets Liability Asset Owner Equity Expense Expense Asset Reasons Increase Increase Increase Increase Increase Increase Decrease Increase Increase Decrease Increase Decrease Decrease Increase Increase Increase Increase Increase Increase Increase Decrease 2,500 500 3,500 20,000 20,000 55,000 55,000 12,000 11,800 200 250 500 250 500 20,000 12,000 8,000 Debit 150,000 30,000 100,000 280,000 Credit

Mohsin Ali Khan started business cash Rs. 150,000, Land Rs. 30,000 and Van Rs. 100,000

Land Van

Rs. 8,000 form Ali and Brothers.

Rs. 500

cash discount 10 % on Rs. 12,000.

5 6

business account in the bank Further investment of Rs. 20,000 made by owner Paid salaries Rs. 2,500 and electricity bill for the month

Rs. 500

20

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Variation Proforma for entries (Solved)

Unit 2

VP # 2.8
S.No 1

Variation Proforma for Journal Entries

Transactions
Chart of Accounts Furniture Accounting Pillars Asset Owner Equity Assets Liability Expense Assets Assets Liability Drawing Assets Assets Owner Equity A/c Payable Cash Cash A/c Receivable FOH Cash Building Cash Owner Equity Liability Assets Assets Assets Expense Assets Assets Assets Reasons Increase Increase Increase Increase Increase Decrease Increase Increase Increase Decrease Increase Increase Decrease Decrease Increase Decrease Increase Decrease Increase Decrease 2,000 2,000 3,000 3,000 15,000 15,000 25,000 25,000 15,000 15,000 3,000 3,000 15,000 15,000 50,000 50,000 10,000 10,000 Debit 200,000 200,000 Credit

Naeem started business with Furniture of worth Rs. 200,000 2 3 5 8 9 10 11 12 Purchased Furniture from Ahmed co. of Rs. 10,000 Purchased goods of value Rs. 50,000 by Cash Bought Office Equipment on account Rs. 15,000 Withdraw Furniture of Rs. 3,000 for Personal consumption Naeem make Additional Investment Rs. 15,000 Cash paid to Creditors of Rs. 25,000 Cash received from Debtors of Rs.15,000 Paid Factory Overhead (FOH) of Rs. 3,000

Owner Equity Furniture A/c Payable Purchases Cash Office Equipment A/c Payable Drawing Furniture Cash

13

Paid Rs. 2,000 for Extension of Building.

21

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Variation Proforma for entries (Solved)

Unit 2

VP # 2.9
S.No 1 Mr. A started business with Cash Rs. 50,000 2 Purchased Supplies Rs. 15,000

Variation Proforma for Journal Entries

Transactions
Chart of Accounts Cash Owner Equity Supplies Cash Cash Note Receivable Sales Accounting Pillars Asset Owner Equity Asset Asset Asset Asset Revenue Expense Asset Expense Asset Expense Asset Liability Revenue Asset Revenue Asset Asset Expense Asset Reasons Increasing Increasing Increasing Decreasing Increasing Increasing Increasing Increasing Decreasing Increasing Decreasing Increasing Decreasing Decreasing Increasing Increasing Increasing Increasing Increasing Increasing Decreasing 300 300 7,000 7,000 16,000 16,000 2,600 2,600 1,500 1,500 7,000 7,000 3,000 3,000 15,000 10,000 25,000 15,000 15,000 Debit 50,000 50,000 Credit

Sold goods Rs. 15,000 by Cash and 10,000 by Note Receivable

4 5 6 7 8

Purchased Goods from J for Cash Rs. 3,000 Supplies Assets has been expired during the period of Rs. 7,000 Bad debts during the year are 1,500 Unearned Sales were earned during the Financial year of Rs. 2,600 Sold goods to R Rs. 16,000

Purchase Cash Supplies Expense Supplies Bad Debts A/c Receivable Unearned Sales Sales Account Receivable Sales Patents Cash Stationary

Purchased Patents for Rs. 7,000

10

Paid for Stationary Expense Rs. 300

Cash

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Variation Proforma for entries (Solved)

Unit 2

VP # 2.10
S.No Transactions

Variation Proforma for Journal Entries

Chart of Accounts Cash Accounting Pillars Reasons Asset Owner Equity Inventory Cash Cash Bad Debts Purchases A/c Payable Motor Cycle Cash Cash Motor Cycle Owner Equity Asset Asset Asset Expense Expense Liability Asset Asset Asset Asset Owner Equity Asset A/c Receivable Car Cash Drawings Inventory Salaries Payable Cash Asset Asset Asset Drawing Asset Liability Asset Profit and Loss Cash Increase Increase Increase Decrease Increase Decrease Increase Increase Increase Decrease Increase Decrease Increasing Increase Decrease Increase Decrease Increase Decrease Decreasing Decrease 3,000 3,000 1,000 1,000 2,500 2,500 5,200 5,200 22,00 19,000 3,000 19000 19000 500 500 1,000 1,000 11,000 11,000 Debit 66,000 66,000 Credit

1 2 3 4 5

Started Business with cash Rs 66,000 Purchase Inventory for cost Rs.11,000 Bad Debts recovered of Rs. 1,000 Purchase Merchandise from Sarwer Rs. 500 Purchase Motorcycle for cash Rs.19,000

6 7 8 9 10

Sold Motor Cycle for Cash Rs.22,000 Which costs Rs.19,000 Received Cash Rs.5,200 from Accounts Receivable Purchased a Car for Cash Rs 2,500. Withdrew Inventory for Private Use Rs. 1,000. Paid Outstanding Salaries to employees Rs. 3,000.

23

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Variation Proforma for entries (Solved)

Unit 2

VP # 2.11
S.No

Variation Proforma for Journal Entries Transactions

Chart of Accounts Bad Debts Pillars of Accounts Expense C. Revenue Asset Liability Asset Revenue Expense Asset Expense Asset Asset Owner Equity Asset Asset Purchases Return C. Expense Reasons Increasing Decreasing Decreasing Decrease Decrease Increase Increasing Decreasing Increase Decrease Increase Decrease Decrease Increase Decrease 300 300 27,00 3,000 30,000 1,500 1,500 2,000 2,000 12,000 11,700 300 Debit 1,500 500 2,000 Credit

Bad debts during the year are 1,500 and goods return by credit customers of Rs. 500.

Sales Return A/c Receivable A/c Payable

Payment made to Ahmed and brother Rs. 11,700 receiving cash discount 2 on Rs. 12,000. Cash Discount Insurance Expense 3 Insurance Assets has been expired during the period of Rs. 2,000 Prepaid Insurance Dep. Exp_ Furniture 4 Depreciation Expense on Furniture of Rs. 1,500 by WDM Furniture Cash Profit and Loss 5 6 Sold old machinery for Cash Rs.27,000 Which costs Rs.30,000 We returned goods to Ali Rs. 300 which was purchased by cash Cash Machinery

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Variation Proforma for entries (Solved)