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For 11th Class Accounts

The document discusses basic accounting concepts like journal, ledger, types of accounts, rules of debit and credit, and treatment of cash and credit transactions. It explains that the journal is used to record transactions in chronological order and the ledger organizes accounts by type. It also outlines the rules for debiting and crediting personal, real, and nominal accounts based on increases or decreases in assets, expenses, and obligations.

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2K views8 pages

For 11th Class Accounts

The document discusses basic accounting concepts like journal, ledger, types of accounts, rules of debit and credit, and treatment of cash and credit transactions. It explains that the journal is used to record transactions in chronological order and the ledger organizes accounts by type. It also outlines the rules for debiting and crediting personal, real, and nominal accounts based on increases or decreases in assets, expenses, and obligations.

Uploaded by

pankaj_jmp823889
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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BASIC ACCOUNTING, JOURNAL & LEDGER, TB, RECTIFICATION, DEPRECIATION, PROVISIONS

& RESERVES, BILLS OF EXCHANGE, FINANCIAL STATEMENTS, ACCOUNTING BY USING


ERP/COMPUTERS

Pankaj Kumar
(CS-Final/CS-Inter/MBA/IFRS/NCFM/BCOM)
Pursuing MCOM
JOURNAL
Journal may be describe as a book in which the transaction are recorded in the
order of occurrence i.e. in chronological order.
It is called a book of prime entry because all business transactions are entered
first in the book. The process of writing the a transaction in journal is known as
journalising and the transaction written in journal is known as journal entry.

LEDGER
Ledger is principal book of accounts. It is most important book in accounting
system. It contain all the accounts (assets, Liabilities, capital, revenue and
expenses) to which the transaction recorded in the book of original entry are
transferred. Ledger is ultimate destination of all the transaction. It is also
called book of final entry. In ledger, the information is classified by nature and
relevance. It may be maintain as bound book or loose leaf sheet or in floppy
disk.
Need of Journal
Convenient recording of the transactions
Maintaining and preserving the identity the transactions
Ascertaining the true nature of transaction with the help of narrations
Maintaining permanent record of information.
Types of Account
Personal Account Impersonal Accounts - Real
Accounts

-Natural Personal Account -Tangible Real Accounts


-Artificial Personal Account -Intangible Real Accounts
-Representative Personal Account Concept:
Concept:
Debit what comes in, and
Debit the Receiver, and
Credit what goes out
Credit the giver (supplier)
Nominal Accounts
Concept:
Debit expenses and losses, and
Credit income and gains
Rules of Debit
1.Personal Account is Debited when :
A person owes us for receiving the benefit e.g., credit sales by
the business.
Obligation of the business is discharged or reduced e.g. payment to a
creditor.
A person becomes liable to business for performance in the future e.g.
prepaid expense.
2. Real Account is debited when :
Some asset is purchased.
Value of the asset increases.
3.Nominal Account is Debited when :
Expenditure is incurred e.g. payment of salary, rent etc.
Loss is suffered due to some reason like fire theft, etc
Rules of Credit
1.Personal Account is Credited when :
Business owes to someone for benefit received e.g. goods purchased) on
credit.
Obligation towards business is discharged or reduced by a person e.g.
receipt from debtor.
Liability of the business towards someone increases for getting some
service or benefit e.g. salaries /wages outstanding.
2.Real Account is Credited when :
Asset is sold.
Asset value decreases due to depreciation.
3. Nominal Account is Credited when :
Business earns income by way of interest, dividend, commission etc.
Business gains e.g. bad debts recovered etc.
Treatment of cash/ credit transaction
(1)Purchased goods for Rs.1200 cash
Purchases AccountDr. 1200
To Cash Account.... 1200
(2)Purchased goods for Rs. 1200on credit/ from Arun
Purchases Account Dr. 1200
To Arun Account... 1200
Treatment of payment on personal / expenses account
(1) Paid Rs. 500 to Varun on account
Varun AccountDr. 500
To Cash Account.. 500
(2)Paid Salary to AmanRs.1000
Salary AccountDr. 1000
To Cash Account.. 1000
Questions

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