Journal Entry: Long Answer Question (Problems and Answers)
Arjun EP
Journal entries of long answer questions
Long answer questions are the best collection of long answer type and analytical.
Questions are set to understand upper entire the chapter.
Students and learners are suggested to solve first brief answer type questions; then solve short answer questions; then long answer type questions.
First, starts to study and practice from beginning of the chapter; after that, if you feel something is confusion you should comment on comment box without any hesitation.
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PROBLEMS AND ANSWERS |
Long Answer Questions
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Currency of your currency
LAQ: 1 Service Firm Owner’s Equity
Queen Beauty Parlour has following financial data:
Balance Sheet of first quarter (Q1)
|
Liabilities |
Amount |
Assets |
Amount |
|
Owner’s equity |
78,000 |
Cash |
9,000 |
|
Account payable |
18,000 |
Account receivable |
40,000 |
|
|
|
Office supplies |
12,000 |
|
|
|
Office equipment |
35,000 |
|
|
96,000 |
|
96,000 |
Other information for the second quarter (Q2):
1, Payment collected earlier client (account receivable) Rs 18,000.
2, Billed client for the service Rs 35,000.
3, Office supplies purchased on account Rs 4,000.
4, Commission received from job endorsed Rs 25,000.
5, Insurance premium paid Rs 6,000 for 12 months which includes Rs 1,500 advance.
6, Office equipment purchased Rs 3,000.
7, 10% Loan took Rs 32,000.
8, Payment made to account payable Rs 12,000.
9, Withdrew cash for house purpose Rs 23,500.
10, Office supplies purchased in cash Rs 1,500.
11, Office rent paid Rs 4,000.
12, Salary paid to staff Rs 9,000.
Additional information:
a. Office supplies used during the period of Rs 9,400.
b. Interest payable on loan for three months.
c. Charge depreciation on equipment Rs 2,500.
Required: Journal entries
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Currency of your currency
LAQ: 2 Service Shareholders’ Equity
EP Online Study LLC has the following transaction:
(1) Invested cash into business and converted into common stock of Rs 200,000.
(2) Purchase office supplies on account Rs 32,000.
(3) Office equipment purchased on account Rs 72,000.
(4) Office equipment purchased in cash Rs 80,000.
(5) Billed to client for service on account Rs 120,000.
(6) Service revenue received in cash Rs 84,000.
(7) Office expenses paid Rs 10,000.
(8) Cash collected from client Rs 80,000 from previous bill (5).
(9) Paid 50% amount of equipment purchased on account bill.
(10) Paid full amount of office supplies purchased on account (2).
(11) Rent paid for the month Rs 4,000 and advance paid for Rs 16,000.
(12) Investment made in government bond Rs 116,000.
Additional information:
a. Office expenses unpaid is Rs 7,500
b. Charge depreciation on equipment @ 15% of total.
c. Office supplies in hand amounting Rs 12,300.
Required: Journal entries
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Click on link for YouTube videos topic wise : |
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Accounting Equation |
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Basic Journal Entries in Nepali |
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Basic Journal Entries |
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Journal Entry and Ledger |
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Ledger Account |
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Subsidiary Book |
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Cash Book |
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Trial Balance and Adjusted Trial Balance |
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Bank Reconciliation Statement (BRS) |
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Depreciation |
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Click on link for YouTube videos chapter wise: |
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Financial Accounting and Analysis (All videos) |
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Accounting Process |
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Accounting for Long Lived Assets |
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Analysis of Financial Statement |
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Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Currency of your currency
LAQ: 3 Service Shareholders’ Equity
EP Education Consultancy LLC has the following transaction: (all transactions through banking)
(a) Invested cash into business and converted into ordinary shares of Rs 500,000.
(b) Office supplies purchased for Rs 5,000.
(c) Office equipment bought for office in cash Rs 20,000.
(d) Equipment purchased on account Rs 30,000.
(e) Consultancy fee received online Rs 20,000.
(f) Communication bills paid online Rs 1,000.
(g) Paid half amount of equipment purchased on account bill.
(h) Salary paid to office assistant Rs 5,000.
(i) Total rent paid Rs 36,000 on demand of house owner; including rent for the current month Rs 6,000.
(j) Bank provided interest on deposit Rs 13,260.
Additional information:
(1) Consultancy fee receivable amounting Rs 41,500.
(2) Salary payable to office staff of Rs 8,400.
(3) Office supplies in hand Rs 1,600.
(4) Remaining bill of equipment amount settled after receiving 10% discount.
(5) Depreciation charged on equipment Rs 10,000.
Required: Journal entries
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Currency of your currency
LAQ: 4 Trading Owner’s Equity
KK Enterprises, grain wholesaler, has following information: (Amount in ’00)
Balance Sheet
|
Liabilities |
Amount |
Assets |
Amount |
|
Capital |
230,000 |
Cash |
50,000 |
|
|
|
Debtor |
150,000 |
|
|
|
Furniture |
30,000 |
|
|
230,000 |
|
230,000 |
Firm transfer all types of profit or loss to P&L account. Other financial transactions are:
(1) Bank account opened by depositing cash of Rs 12,700
(2) Goods purchased from Bharat Rs 150,000; paid Rs 30,000 in cash and balance on-credit.
(3) Unused furniture costing Rs 5,000 was disposed-off for Rs 2,000.
(4) A debtor of Rs 30,000 settled his account receiving cash discount of Rs 1,500 by cheque.
(5) Goods withdrawn by proprietor for personal use Rs 3,000.
(6) Goods sold for Rs 130,000 and received cash Rs 110,000 partially.
(7) Settled Bharat’s account by paying cash Rs 98,000 for Rs 100,000.
(8) Telephone and internet bill paid through online payment of Rs 1,550.
(9) Goods distributed as charity at Corona Pandemic Rs 13,250.
(10) Rent paid to house owner Rs 12,000 which includes Rs 2,000 as advance.
(11) Salary paid Rs 5,000 and still payable for the month Rs 7,500
Additional information:
(a) Goods distributed as free sample worth Rs 3,750 omitted to record
(b) Charge depreciation on remaining furniture at 20%.
(c) Closing stock valued Rs 30,000.
Required: Journal entries
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Currency of your currency
LAQ: 5 Trading Shareholders’ Equity
PK Glass LLC has following financial data:
(a) Investment received Rs 700,000 to start business and converted into 70,000 equity shares @ Rs 10.
(b) Cash withdrew from bank Rs 185,000 for office use.
(c) Equipment purchased by cheque Rs 65,000.
(d) Inventory purchased is cash 150,000 and purchased on account Rs 250,000.
(e) Insurance premium paid Rs 4,500.
(f) Inventory sold for cash Rs 150,000 and sold on account Rs 50,000.
(g) Cheque issued to supplier Rs 75,500.
(h) Cash received from customers Rs 22,500
(i) Defective goods returned to supplier worth Rs 2,500.
(j) Customer returned excess goods of Rs 4,200.
(k) Utilities bills (electricity, phone, internet, water bill) paid Rs 3,000.
(l) Salary paid in cash Rs 40,000 and still payable Rs 20,000.
(m) Rent paid for Rs 25,000 by cheque.
Additional information:
1. Closing stock values Rs 301,700.
2. Rent paid includes advance rent of Rs 7,000.
3. Depreciation charged on equipment @ 20%
Required: Journal entries
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Currency of your currency
LAQ: 6 Trading Owner’s equity
Nepal Trading House, a sole proprietorship, has the following extracted information:
1, Business started with cash Rs 2,50,000 bank Rs 75,000.
2, Purchase goods form SM Suppliers Rs 40,000 and paid Rs 10,000 partially.
3, Sold goods to EP Traders for 30,000 and received a cheque of Rs 5,000 partially.
4, Computer and printer purchased for Rs 40,000.
5, Goods purchased from MC Group for Rs 55,000 and paid Rs 40,000 in cash and balance by cheque.
6, Damage goods returned by EP Traders Rs 2,000.
7, Cheque issued to SM Suppliers Rs 19,000 full settlement of Rs 20,000.
8, Cash received Rs 9,500 in full settlement of Rs 10,000 from EP Traders.
9, Advance rent paid to house owner Rs 15,000.
10, Interest allowed by bank Rs 1,000.
11, Loan gave to friend Binesh Rs 25,000.
12, Commission Rs 4,000 received in advance.
13, Withdrew for domestic use cash Rs 5,000 goods worth Rs 1,500.
14, Salary payable to staff Rs 8,000.
Additional information:
(a) Depreciation is charged on equipment @ 20%.
(b) Advance rent expired to the extent of Rs 12,000.
(c) Commission earned out of advance Rs 2,850. (d) Closing stock valued Rs 80,000.
Required: Journal entries
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