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VU Past Papers, MCQs and More

Topic to be tested:

  • Rules for Debiting & Crediting

 Learning Objectives:

  • To develop an understanding of accounting rules by analyzing nature of an account
  • To express the effects of business transactions in terms of debits and credits to different types of transactions.

 CONSTRUCT:

During a financial year, a business may experience thousands of transactions. It is the responsibility of an accountant to classify and record these transactions as well as to summarize the data in these transactions to create useful information. Every business transaction has two aspects. One aspect is debited while the other is credited. Both of the aspects have to be recorded in accounts appropriately. Accountants use the term debit for the entry to be placed on left side of an account and the term credit for entry on the right side of the same account. 

DISCUSSION QUESTIONS:

Being a student of accounting, you are required to:

1)     Recognize business transactions from the following mentioned events.

2)     Analyze the business transactions thoroughly and determine its increasing or decreasing effects on the assetsliabilities, equity,revenues, or expenses of the business.

3)     Explain these increasing or decreasing effects into debits and credits

 

Report on Business and non-business events of ABC Company

During XXX financial year

 

1

ABC company sold goods of RS.10, 000 on account, agreeing to receive payment within 10 days after delivering the items.

2

Expenses incurred for the renovation of the new office of Rs.2, 000

3

Paid Rs.1,000 for the office equipment purchased on account

4

Expenses incurred by partner A on birthday party of his son worth Rs.20, 000

5

Laundry expenses by wife of  partner B for Rs.1,500

6

The company borrowed Rs.60,000 from Partner A’s father and promised to repay the amount borrowed within one year

7

company issued shares of capital stock for Rs.30,000 cash to Partner B, his wife and son

8

Rs.95,900 is a revenue earned by the business during the year

9

Paid Rs.4, 000 cash for office rent.

10

Expenses incurred on foreign official trip by partner A Rs.35,000

 Note: It is compulsory to follow the given format for answering the discussion questions (one is done for you):

 

Transaction #

 

Nature

Analysis

Recording

Purchased office equipment of RS.10, 000 on account

Business transaction

Increased assets (office equipment) and liabilities (accounts payable

Dr. Asset and Cr. Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Important Instructions:

 Your discussion must be based on logical facts.

  1. Solution must be provided in the recommended table / format
  2. Do not copy or exchange your answer with other students. Two identical / copied comments will be marked Zero (0) and may damage your grade in the course.
  3. Obnoxious or ignoble answer should be strictly avoided.
  4. Questions / queries related to the content of the GDB, which may be posted by the students on MDB or via e-mail, will not be replied till the due date of GDB is over.

Views: 11115

Replies to This Discussion

you need to solve other 9 question in table like first one, when they solved, simply copied table and post in your GDB comments section, first make sure, all solutions are correct..

Note: if you still not understand, how to solve it, check upper comments, some peoples also attach MS document files.

plz mujhe b help chahiye kya baqi ke bhi yahan nai a sakte answers

Choprian and wo bhi two two

have a heart, lubna sis.

Wrong...! 

This is non-business transaction and will have no affect on business accounts.

Has it been written in statement that wife of partner B has taken this money from business?

what you think about 5. (Revision)

Airborne 

This is more than obvious that this cash is taken out of company's account. Do you know the term 'Drawings'?

yes, Airborne is thinking like me

can't understand the 4th,8th,9th and 10th part. can anybody guide me please

Nimra Sis, if u have understood point 5 then 4 has the same answer.

Similarly point 1 and point 8 have the same answer.

@Shakeel, Common Man, you told a lot :) hehehhe

Ahmad Bhai, i did not understand u.

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