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    Double Entry Bookkeeping (S)

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    Beatriz Cordelia Choy
    This document discusses key concepts in double-entry bookkeeping including: 1. Double-entry bookkeeping records each transaction with at least one debit and one credit entry. 2. Transactions are first recorded in a journal, then transferred to individual accounts in the ledger. 3. The accounting equation (Assets = Capital + Liabilities) must be balanced by equal debits and credits for each transaction. 4. 'T' accounts illustrate how debits and credits increase or decrease different types of accounts like assets, capital, and liabilities. 5. Examples from Frank Wood's Business Accounting textbook demonstrate double-entry recording of business transactions through journal entries and corresponding T-accounts.

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    © All Rights Reserved
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    Double Entry Bookkeeping (S)

    Uploaded by

    Beatriz Cordelia Choy
    80 views9 pages
    This document discusses key concepts in double-entry bookkeeping including: 1. Double-entry bookkeeping records each transaction with at least one debit and one credit entry. 2. Transactions are first recorded in a journal, then transferred to individual accounts in the ledger. 3. The accounting equation (Assets = Capital + Liabilities) must be balanced by equal debits and credits for each transaction. 4. 'T' accounts illustrate how debits and credits increase or decrease different types of accounts like assets, capital, and liabilities. 5. Examples from Frank Wood's Business Accounting textbook demonstrate double-entry recording of business transactions through journal entries and corresponding T-accounts.

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    2. Double Entry Bookkeeping (S) (1)

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    This document discusses key concepts in double-entry bookkeeping including: 1. Double-entry bookkeeping records each transaction with at least one debit and one credit entry. 2. Transactions are first recorded in a journal, then transferred to individual accounts in the ledger. 3. The accounting equation (Assets = Capital + Liabilities) must be balanced by equal debits and credits for each transaction. 4. 'T' accounts illustrate how debits and credits increase or decrease different types of accounts like assets, capital, and liabilities. 5. Examples from Frank Wood's Business Accounting textbook demonstrate double-entry recording of business transactions through journal entries and corresponding T-accounts.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    80 views9 pages

    Double Entry Bookkeeping (S)

    Uploaded by

    Beatriz Cordelia Choy
    This document discusses key concepts in double-entry bookkeeping including: 1. Double-entry bookkeeping records each transaction with at least one debit and one credit entry. 2. Transactions are first recorded in a journal, then transferred to individual accounts in the ledger. 3. The accounting equation (Assets = Capital + Liabilities) must be balanced by equal debits and credits for each transaction. 4. 'T' accounts illustrate how debits and credits increase or decrease different types of accounts like assets, capital, and liabilities. 5. Examples from Frank Wood's Business Accounting textbook demonstrate double-entry recording of business transactions through journal entries and corresponding T-accounts.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 9

    1.

    2 Double-entry bookkeeping
    (a) Recording of transactions by double-entry
    (b) Balance an account and bring down the balance
    Double entry bookkeeping
    Reference: Frank Wood’s-Business Accounting Sangster 14th Edition - Chapter 2- Recording transactions
    Page 21-43

    Use the accounting equation


    Book-keeping
    Double entry book-keeping is a system where each transaction is entered twice, once on the debit side and once
    on the credit side.

    Basic Principles of Bookkeeping (still use in modern accounting!)


    1. That all transactions should be recorded in great details in a book called the “Journal or Memorandum”.

    2. The transactions should then be transferred to another book, the Ledger, and that each transaction has at least
    two entries to it, a debit and a credit, hence the term ‘Double Entry’ bookkeeping.

    Recording transactions through double entry (assets, capital and liabilities)

    Dr ‘T’ Account Name Cr


    --------------------------------------------------------------------------------------------------------------------------------------
    Date Narrations $ ∣ Date Narrations $
    ∣
    Debit(Dr) ∣ Credit(Cr)
    *(It can be + or – depending on the type of account) ∣ *(It can be + or – depending on the type of account)
    ∣

    Assets = Capital + Liabilities

    Dr Assets Cr Dr Capital Cr Dr Liabilities Cr


    ------------------------------------- --------------------------------------- -------------------------------------
    $ $ $ $ $ $
    Debit Credit Debit Credit Debit Credit

    (increase)↑ (decrease)↓ (decrease)↓ (increase)↑ (decrease)↓ (increase)↑


    Disposal

    + - - + - +

    Dr Drawings Cr
    --------------------------------------------
    $ $
    Debit Credit
    (increase)↑ (decrease) ↓

    + -
    Double entry
    Question 1
    Complete the following table, showing which accounts are to be debited and which are credited:
    Transactions Account to be Account to be
    debited credited

    (a) Bought a lorry in cash

    (b) Paid a trade payable, T Lui, by cheque

    (c) Repaid P Mok’s loan in cash

    (d) Sold the lorry for cash.

    (e) Bought office machinery on credit from Ultra Ltd

    (f) A trade receivable, C Wing, paid us in cash

    (g) A trade receivable, W Po, paid us by cheque

    (h) The proprietor put a further amount


    into the business by cheque

    (i) A loan of $200 in cash was received from L Lo

    (j) Paid a trade payable, S Chun, in cash

    Question 2:
    Complete the following table: Debit Credit

    (a) Bought office machinery on credit from D Isaacs Ltd. ___________ ____________

    (b) The proprietor paid a trade payable, C Jones, from his ___________ ____________
    private monies outside the firm.

    (c) A trade receivable, N fox, paid us in cash. ___________ ____________

    (d) Repaid part of loan from P Exeter by cheque ___________ ____________

    (e) Returned some of office machinery to D Isaacs Ltd ___________ ____________

    (f) A trade receivable, N Lyn, pays us by cheque. ___________ ____________

    (g) Bought motor van by cash. ___________ ____________


    Question 3
    1. A business bought a motor vehicle on credit from Cas Supplier Motor for $6,200

    2. A trade receivable (debtor) pays $250 by cheque

    3. Mandrake bought goods on credit from JJ Toys for $700

    4. Yaya negotiates a 10 year-loan from Bank of China for $900,000.


    5. Purchase of goods by cash $350

    6. L Wang draws a cheque upon his bank to repay the full loan from T Wells.

    7. The owner withdraws $160 from the firm’s bank account for his personal use.
    Question 4
    Write up the accounts to record the following transactions for T Wong:
    2015
    Jun 1 Started business with $30,000 cash and a $40,000 bank deposit.
    Jun 2 Bought office furniture for $4,000 on credit from Sun Furniture.
    Jun 6 The owner put $5,000 cash into the business
    Jun 10 Bought a photocopy machine for $10,000 by cheque
    Jun 13 Returned office furniture, which cost $200, to Sun Furniture.
    Jun 16 Bought more office furniture for $3,000 in cash
    Jun 17 Paid Sun Furniture $2,000 by cheque
    Jun 19 Bought fixtures for $2,000 in cash.
    Jun 22 Received a $10,000 loan in cash from D Hu.
    Jun 25 Put $15,000 cash into bank account.
    Jun 27 Paid Sun Furniture $1,800 in cash.
    Jun 30 Bought a digital camera for $3,000 which was paid by the owner.

    Dr Cash Cr Dr Bank Cr
    2015 $ 2015 $ 2015 $ 2015 $

    Dr Capital Cr Dr Office Furniture Cr


    2015 $ 2015 $ 2015 $ 2015 $

    Dr Sun Furniture Cr Dr Photocopy machine Cr


    2015 $ 2015 $ 2015 $ 2015 $

    Dr Fixtures Cr Dr Loan from D Hu Cr


    2015 $ 2015 $ 2015 $ 2015 $

    Dr Digital camera Cr Dr Cr
    2015 $ 2015 $ 2015 $ 2015 $
    Question 5
    Write up the accounts of A Chiu to record the following transactions:
    2006
    Mar 1 Started business with $12,000 cash and a van worth $6,000.
    Mar 3 Bought machinery for $16,000 on credit from Super Machines
    Mar 6 Received a $50,000 bank loan, which was deposited in the company’s bank account.
    Mar 8 Bought a computer for $25,000 on credit from Universal Ltd
    Mar 15 Paid Super Machines $10,000 by cheque
    Mar 17 Bought office furniture for $4,000 in cash
    Mar 19 Paid Universal Ltd $10,000 by cheque
    Mar 20 Paid Super Machines $6,000 in cash
    Mar 23 Returned machinery costing $700 to Super Machines, which agreed to refund within a month.
    Mar 25 Took $5,000 out of the bank and put it into the cash till.
    Mar 27 Sold a van for $6,000 in cash
    Mar 30 Paid Universal Ltd $15,000 by cheque

    Dr Cash Cr Dr Van Cr
    2006 $ 2006 $ 2006 $ 2006 $

    Dr Capital Cr Dr Machinery Cr
    2006 $ 2006 $ 2006 $ 2006 $

    Dr Super Machines Cr Dr Bank Loan Cr


    2006 $ 2006 $ 2006 $ 2006 $

    Dr Bank Cr Dr Computer Cr
    2006 $ 2006 $ 2006 $ 2006 $

    Dr Universal Ltd Cr Dr Office Furniture Cr


    2006 $ 2006 $ 2006 $ 2006 $
    Assets = Capital + Liabilities
    Frank Wood’s Business Accounting 14th Edition Alan Sangster Chapter 2 Recording Transactions Page
    21 to 43
    Ex 2.11A
    Ex 2.14A
    Ex 2.15A

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