(b) : Take the transactions in Qno:3 of this paper.

REQUIRED:

Record all the transactions in standard form of general journal giving explanation below each entry.

Q no: 2

The following transactions were completed by ABC Company, during the month of January 2015:

Jan 1st: commenced business with an investment of cash Rs. 50, 000 and merchandise worth Rs. 40, 000.

2nd: purchased merchandise on account from Naim & Co. for Rs.30, 000 and paid carriage thereon Rs.400

4: purchased shop furniture for cash Rs. 4, 000

5: with drew merchandise worth Rs. 400 an cash Rs. 500 for personal use.

8: cash sales for the day Rs. 6, 000

15: purchased sales supplies for cash Rs. 800

20: paid insurance expense in cash Rs. 1, 000

22: sold merchandise on account to Mani Rs. 8, 000

23: Mani returned defected goods worth Rs. 700

24: Paid rent expense in cash Rs1, 000

29: Paid to Naim for merchandise cash Rs. 15, 000

30: received cash from Mani on account Rs. 4, 000

31: Paid for salaries expense Rs. 1000 cash

REQUIRED:

a) Set up necessary T-accounts in the ledger of ABC Company and record the above transactions direct into the accounts affected, completing the double entry in each case.

b) Foot the accounts in pencil and enter the balances in appropriate columns.c) Test the accuracy of your postings by taking out a pre- closing trial balance on January 31st , 2015

having complete title and column headings.