Kalp Accounting Learning Articles

Now let's come to discuss about the Journal Entry, Ledger Posting and related Reports/Statements in Final Accounts when Trading Goods are purchased through payment of Cash. Affected Ledger Accounts : Purchases A/c - Debit Cash A/c - Credit Journal Entry : Ledger Posting : Cash A/c - Credit Column Purchases A/c - Debit Column  Trial Balance : Cash A/c - Debit column of Trial Balance. Debit column of Trial Balance(Cash A/c) will be decreased by the transaction amount. Purchases A/c - Debit column of Trial Balance. Debit column of Trial Balance(Purchases A/c) will be increased by the transaction amount. Trading and Profit & Loss Account : Purchases A/c - Debit side of Trading Account. Debit side of Trading Account(Purchases A/c) will be increased by the transaction amount. Balance Sheet : Cash A/c - under Current Assets in Assets side of Balance Sheet.  Cash A/c under Current Assets will be decreased by the transaction amount.  

Now let's come to a discussion on Journal Entry, Ledger Posting and related Reports/Statements in Final Accounts, when Fixed Assets are purchased by payment of Cash. Affected Ledger Accounts : Fixed Assets A/c - Debit Cash A/c - Credit Journal Entry : Ledger Posting : Cash A/c - Credit Column Fixed Assets A/c - Debit Column    Trial Balance : Cash A/c - Debit column of Trial Balance. Debit column of Trial Balance(Cash A/c) will be decreased by the transaction amount. Fixed Assets A/c - Debit column of Trial Balance. Debit column of Trial Balance(Fixed Assets A/c) will be increased by the transaction amount. Profit & Loss Account : No effect on Profit & Loss Account. Balance Sheet : Cash A/c - under Current Assets in Assets side of Balance Sheet.  Cash A/c under Current Assets will be decreased by the transaction amount. Fixed Assets A/c - under Fixed Assets in Assets side of Balance Sheet. Fixed Assets A/c will be increased by the transaction amount   << Previous T

Let's come to discuss on the topic Journal Entry, Ledger Posting and Related Reports/Statements when the Proprietor of a Business withdraw Cash from his/her business towards personal expenses. Affected Ledger Accounts : Drawings A/c - Debit Cash A/c - Credit Journal Entry : Ledger Posting : Cash A/c - Credit Column Drawings A/c - Debit Column. Trial Balance : Cash A/c - Debit column of Trial Balance. Debit column of Trial Balance(Cash A/c) will be decreased by the transaction amount. Drawings A/c - Debit column of Trial Balance. Debit column of Trial Balance(Drawings A/c) will be increased by the transaction amount. Profit & Loss Account : No effect on Profit & Loss Account. Balance Sheet : Cash A/c - under Current Assets in Assets side of Balance Sheet.  Cash A/c under Current Assets will be decreased by the transaction amount. Drawings A/c - under Capital Account in Liabilities side of Balance Sheet. Drawings A/c under Capital Account is shown by transferring the drawings

Now let's come to discuss on the affected Ledger Accounts/Books of Account and Accounting Reports/Statements for Capital Investment in Cash by the Partners of a Partnership Firm. Affected Ledger Accounts : Cash A/c - Debit Partner's Capital A/c - Credit Journal Entry :   In this post let's consider for a three person Partnership Firm . 1st Partner, 2nd Partner and 3rd Partner decided to start a business with Capital investment equally by Cash. Affected Ledger Accounts :  Cash A/c - Debit Capital(Partner-1) A/c - Credit Capital(Partner-2) A/c - Credit Capital(Partner-3) A/c - Credit Journal Entry for the above three person Partnership Business is :   Here, the Debit amount of Cash A/c should be equal to the total of Investment amount by Partner-1, Partner-2 and Partner-3 . For an example, if the Investment amounts are by Partner-1 ₹50000/- Partner-2 ₹50000/- and  Partner-3 ₹50000/-  In Journal Entry Cash A/c - Debit = ₹150000/-(i.e Partner-1 ₹50000 + Partner-2 ₹50000

Now let's come to discuss on the affected Ledger Accounts/Books of Account and Accounting Reports/Statements for Capital Investment in Cash by the Proprietor/Owner of a Sole Proprietorship Business. Affected Ledger Accounts : Cash A/c - Debit Proprietor's Capital A/c - Credit Journal Entry : Ledger Posting : Cash A/c - Debit column. Proprietor's Capital A/c - Credit column. 'Capital A/c' can be mentioned in place of Proprietor's Capital A/c Trial Balance : Cash A/c - Debit column of Trial Balance. Debit column of Trial Balance(Cash A/c) will be increased by the transaction amount. Proprietor's Capital A/c - Credit column of Trial Balance. Credit column of Trial Balance(Proprietor's Capital A/c) will be increased by the transaction amount. Profit & Loss Account : No effect on Profit & Loss Account. Balance Sheet : Cash A/c - under Current Assets in Assets side of Balance Sheet.  Cash A/c under Current Assets will be increased by the transaction am