The books of accounts are classified according to the functions they perfume. Basically they are 2 groupings:
1. books of original (or prime)entry of journal and
journal proper is meant for recording of such transactions (PRIOR TO THE TRANSFER TO THE LEDGER ) WHICH CAN NOT BE CONVENIENTLY recorded in any of the special journals.
The journal proper is therefore, a form of diary into which daily transactions of a business are first recorded unclear the double entry system. It indicates account to be debited and account
to be credited for such transactions. As a book of a original entry, the journal proper does not replace but precedes the ledger. The process of recording transactions in journal is termed journalizing typical journal proper contain five columns as follows
1. The date columns for recording the date of the transactions.
2. The particulars column is which details of the accounts to be debited or credited are recorded. This column also contains as explanatory notes or marathon which explains the nature or reason for the individual transaction
3. The folio : ledger page
4. The debit column: which records the amount be debited
5. The credit column ; which records the amount to be credited
Illustration:
Eze started a business with a capital of N1000,00 on January 2011. here the two accounts involved are:
– ezes account, and
– cash amount
Journal
Date |
Particulars |
Folio |
Debit N |
Credit N |
JAN 1, 2011 |
cash Account |
1,000,00 |
||
capital account |
1,00,000 |
|||
(being commencement of business on that date) |
ILLUSTRATION: UGOCHRUKWU, WHO has been in business made the following transaction in 2011
Feb 2 purchased 2 sets of office furniture from emmer and Co @ N2000 each on credit
Feb 6 sold on credit goods worth N 5000 to Kingsley, but debited kingdoms account with the amount in error.
NB: this illustration demonstrated the use of the journal proper to record the purchase of fixed assets on credit and correction of book keeping errors.
Journal
Date |
Particulars |
Folio |
Debit N |
Credit N |
Feb 2 |
office furniture Emma and co |
4000 |
||
(being correction of error in posting to Kingsley’s account ) |
14000 |
|||
Feb 6 |
Kingsley |
5000 td> | ||
Kindom |
5000 |
|||
(Being correction of error in posting to Kingsleys account) |
Illustration: (using of journal proper for opening statements of assets and liabilities)
Ekuma has the following balances in his record as at January 2, 2011. enter the balances in Ekumas appropriate book of prime entry preparatory to their being transferred to the ledger
Office equipment |
90,000 |
Furniture’s & fittings |
60,000 |
Cash in hand |
20,000 |
Cash at bank |
40,000 |
Debtors: C Nnworie |
10,000 |
A. eze Nzekwe |
8000 |
Creditor A. Nzekwe |
20,000 |
Solution
Journal
Date |
Particulars |
Folio |
Debit N |
Credit N |
Jan 2011 |
Office equipment |
90,000 |
||
Furnitures & fittings |
60,000 |
|||
Cash in hand |
20,000 |
|||
Cash at bank |
40,000 |
|||
Sundry debtors C. nworie |
10,000 |
|||
A eze |
8000 |
|||
Creditors: S nzekwwe |
20,000 |
|||
Capital (difference) |
208,000 |
|||
(being opening assets & licts as at that date |
Illustrations : (for closing entries)
show the journal entries requested to transfer the following balances from the respective nominal accounts to the trading, profit & loss accounts:
Jan 31 sales account: balance b/d n10,000(cr)
Rent account: balance b/d N 5000(dr)
Advertisement account: balance b/d n2,000(dr)
Discount allowed account bal b/d n800(dr)
Discount received account bal. B/d n1500 cr
solution:
Journal
Date |
Particulars |
Folio |
Debit N |
Credit N |
Jan 31 |
Sales |
10,000 |
||
Trading |
10,000 |
|||
(being balanced transferred to trading a/c ) |
||||
Profit & loss account |
5000 |
|||
Rent a/c |
5000 |
|||
Being balanced transferred to P & L a/c |
||||
Profit & loss a/c |
2000 |
|||
Advertisement a/c |
2000 |
|||
Being balanced transferred to P & L a/c |
||||
Profit & loss a/c |
800 |
|||
Discount received a/c |
800 |
|||
Being balanced transferred to P & L a/c |
||||
Discount received a/c |
1500 |
|||
Profit & loss A/C |
1500 |
|||
Being balanced transferred to P & L a/c |
Related Posts: ACCOUNTING
Be the first to comment