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Financial Accounting I – III
BBA | BBA-BI | BBA-TT | BCIS 1st
PU 2014 Fall (old) Q. No. 2
Following is a summary of transactions of Fishtail Services Company that occurred during June 2007.
2005 June 1 Began business by depositing Rs. 1,00,000 in a bank account in the name of the company in exchange of shares of Rs. 100 each in the company.
4 Purchased supplies on credit Rs. 700.
6 Paid two months rent in advance, Rs. 2,000.
7 Purchased equipment for cash, Rs. 1,200.
8 Received cash for services performed. Rs. 8,600.
14 Paid cash for an advertisement that appeared in the local newspaper, Rs. 1,400.
17 Received Rs. 11,200 for sale of services.
23 Paid wages to assistant, Rs. 1,500.
25 Billed customer for work done other than on cash terms, Rs. 13,100.
28 Declared and paid dividend, Rs. 2,500.
29 Received partial payment from customers billed on June 25, Rs. 4,800.
30 Paid electricity charges, Rs. 240.
Required: Pass journal entries for June transactions; Post them into T account and prepare a trial balance. [6 + 6 + 3]
Journal Entries
In the book of Fishtail Service Company
June 1
Bank a/c Dr. Rs. 1,00,000
Share capital a/c Rs. 1,00,000
(To record the contribution of cash for capital)
June 4
Supplies a/c Dr. Rs. 7,000
Cash a/c Rs. 7,000
(To record the purchase of office supplies on account)
June 6
Prepaid rent a/c Dr. Rs. 2,000
Cash a/c Rs. 2,000
(To record the prepayment rent for two month)
June 7
Equipment a/c Dr. Rs. 1,200
Cash a/c Rs. 1,200
(To record the purchase of equipment)
June 8
Cash a/c Dr. Rs. 8,600
Service revenue a/c Rs. 8,600
(To record the cash received from service provided)
June 14
Advertisement expenses a/c Dr. 1,400
Cash a/c Rs. 1,400
(To record the payment for advertisement)
June 17
Cash a/c Dr. Rs. 11,200
Service revenue a/c Rs. 11,200
(To record the cash received from services)
June 23
Wages expenses a/c Dr. Rs. 1,500
Cash a/c Rs. 1,500
(To record the payment of wages)
June 25
Bills receivable a/c Dr. Rs. 13,100
Service revenue a/c Rs. 13,100
(To record the billed to customers)
June 28
Dividend expenses a/c Dr. Rs. 2,500
Cash a/c Rs. 2,500
(To record the payment of dividend)
June 29
Cash a/c Dr. Rs. 4,800
Bills receivable a/c Rs. 4,800
(To record the cash received from bills receivable)
Electricity expenses a/c Dr. Rs. 240
Cash a/c Rs. 240
(To record the payment of electricity charges)
T-accounts
Trial Balance
Fishtail Service Company
June 30, 2007
| S.N. | Particulars | Dr. Rs. | Cr. Rs. |
| 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. | Bank a/c Share capital a/c Account payable a/c Office supplies a/c Prepaid rent a/c Cash a/c Equipment a/c Service revenue a/c Advertising expenses a/c Wages expense a/c Bills receivable a/c Dividend expenses a/c Electricity expenses a/c | 1,00,000 700 2,000 15,760 1,200 1,400 1,500 8,300 2,500 240 | 1,00,000 700 32,900 |
| Total | Rs. 1,33,600 | Rs. 1,33,600 |
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