No.

1 for CA/CWA & MEC/CEC MASTER MINDS

9. SELF BALANCING LEDGERS

SOLUTIONS TO ASSIGNMENT PROBLEMS
PROBLEM NO.1
In the Debtors Ledger
General Ledger Adjustment Account
Dr. Cr.
Particulars Rs. 2011 Particulars Rs.
Jan 31 To Debtors Ledger Jan 1 By Balance b/d 16,000
Adjustment Account Jan 31 By Debtor Ledger
Bank 7,800 Adjustment A/c
Discount 200 Sales 9,800
Bills Receivable 3,000 Bills Receivable
Returns Inwards 875 Dishonoured 375
Allowances 275
Bad Debts 450
To Balance c/d 13,575
26,175 26,175
Feb 1 By Balance b/d 13,575

In the Creditors Ledger

General Ledger Adjustment Account
2011 Particulars Rs. 2011 Particulars Rs.
Jan 1 To Balance b/d 18,500 Jan 31 By Creditors Ledger
Jan 31 To Creditors Adjustment
Ledger Account :
Adjustment Bank 9,875
Account : Discount 325
Purchases 4,500 Bills Payable 1,500
Return outwards 600
Allowances 150
By Balance c/d 10,550
23,000 23,000
Feb 1 To Balance b/d 10,550

In General Ledger
Debtors Ledger Adjustment Account
2011 Particulars Rs. 2011 Particulars Rs.
Jan 1 To Balance b/d 16,000 Jan 31 By Nominal Ledger
Jan 31 To Nominal Ledger Adjustment Account:
Adjustment A/c: Bank 7,800
Sales 9,800 Discount 200
Bills Receivable Bills Receivable 3,000
Dishonoured 375 Returns inwards 875
Allowances 275
Bad Debts 450
By Balance c/d 13,575
26,175 26,175
Feb 1 To Balance b/d 13,575

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 Ph: 9885125025/26
Creditors Ledger Adjustment Account
2011 Particulars Rs. 2011 Particulars Rs.
Jan 31 To Nominal Ledger Jan 1 By Balance b/d 18,500
Adjustment A/c: Jan 31 By Nominal Ledger
Bank 9,875 Adjustment A/c :
Discount 325 Purchases 4,500
Bills Payable 1,500
Return Outwards 600
Allowances 150
To Balance c/d 10,550
23,000 23,000
Note: 1. Cash sales 2. Provision for doubtful debts will not appear in the adjustment accounts.
Because these will not affect debtors A/c.

PROBLEM NO.2
Journal of Exe. Ltd.
Self-Balancing System

(a) Sales Ledger Adjustment Account (In General Ledger) Dr. 1,000
To General Ledger Adjustment Account(In Sales Ledger) 1,000
(The error because of the under-casting of Sales Books, rectified)
Suspense Account (In Sales Ledger) Dr. 1,000
To Sales Account(in general ledger) 1,000
(Rectification of the error resulting from under casting of the Sales Book)
(b) Suspense Account (In Sales Ledger) Dr.
50
To Rao (In Sales Ledger)
50
(Rectification of the error by which Rao was not credited, accounts in the
general ledger are not affected)
(c) Murty (In Purchase Ledger) Dr. 310
To Murty (In Sales Ledger) 310
(Transfer of Murty’s credit balance in the Purchase Ledger to his account
in the Sales Ledger)
Bought Ledger Adjustment Account (In General Ledger) Dr. 310
To General Ledger Adjustment A/c (In Bought Ledger) 310
(Correction of the adjustment accounts relating to the Bought Ledger
because of the transfer of Murty’s account, in the Purchase Ledger)
General Ledger Adjustment Account (In Sales Ledger) Dr.
To Sales Ledger Adjustment A/c (In General Ledger) 310
(Corrections of the adjustment account relating to the sales Ledger 310
because of the transfer of Murty’s account)

Note: It is assumed that if a ledger is not balanced, a Suspense Account has been opened.

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No.1 for CA/CWA & MEC/CEC MASTER MINDS
Sectional Balancing System

(a) Total Debtors Account Dr. 1,000

To Sales Account 1,000
(Rectification of the consequence of the under- casting the Sales Book)
(b) Credit with Rs. 50 (In Sales Ledger) to Mr.Rao A/c.
(c) Murty (In Purchase Ledger) Dr. 310
To Murty (In Sales Ledger) 310
(Transfer of Murty’s credit balance Rs. 310 in the Purchase Ledger to
his account in the Sales Ledger)
Total Creditors A/c Dr.
To Total Debtors A/c 310
(Adjustment of total accounts because of the transfer of Murty’s 310
account, in the Purchase Ledger to the Sales Ledger)

PROBLEM NO.3
General Ledger Adjustment A/c (In Sales Ledger)
2010 Rs. 2010 Rs.
Jan. to Dec.
31 To Sales Ledger Jan. 1
st
By Balance b/d 91,500
st
Adjustment A/c in Jan 1 to By Sales Ledger
General Ledger: to dec Adjustment A/c in
st
Return Inward 800 31 General Ledger
Bank 51,000 Sales 45,400
Discount 900 B/R Dishonoured 2,400
Bills Receivable 17,000 Sundry Charges 690
Bad Debts 5,000
Transfer 1,290
Dec 31 To Balance c/d 64,000
1,39,990 1,39,990
2011
Jan. 1 By Balance b/d 64,000

General Ledger Adjustment A/c (In Purchase Ledger)

2010 Rs. 2010 Rs.
Jan 1 to
Jan 1st To Balance b/d 1,09,800 Dec 31 By Purchases Ledger
Jan 1st to To Purchases Ledger Adjustment A/c in General Ledger
dec 31st Adjustment A/c Bank
(in General Ledger) Bills Payable 61,400
Purchases 41,000 Return Outward 24,000
Bills Payable dishonoured 6,000 Discount 1,200
Allowance 1,340
Transfer 550
By Balance c/d 1,290
67,020
1,56,800
1,56,800

2011 Jan 1 To Balance b/d 67,020

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PROBLEM NO.4
Sales Ledger
General Ledger Adjustment Account
2010 Rs. 2010 Rs.
April 1 To Balance b/d 400 April 1 By Balance b/d 3,500
April 2 To Sales Ledger April 3 By Sales Ledger
Adjustment A/c 300 Adjustment A/c
April 30 To “ “ (P, X & Y) 3,250 (Sales) 700
To “ “ (A, B, C) 3,750 April 30 By Sales Ledger
To “ “ R(advance) 2,000 Adjustment A/c 4,500
April 30 To Balance c/d 1,000 April 30 By Balance c/d 2,000
(A,B & P)
10,700 10,700
May 1
May 1 To Balance b/d 2,000 By Balance b/d 1,000
Working Notes:
(i) Opening balance includes the following debts :
Rs.
X 500
Copy Rights Reserved
Y 2,000
P 1,000
To MASTER MINDS, Guntur
3,500
(ii) Opening debit balance Rs. 400, is advance from T.
(iii) Closing debit balance represents advance from R Rs. 2,000
(iv) Closing balance of Rs. 1,000 includes the following debts
Rs.
A 250(1000-750)
B 500(1500-1000)
P 250
1,000
(v) Cash collected from debtors:
Debtor name Amount Rs.
X 475
Y 2000
T 300
P 750
A 750
B 1000
C 2000
Total 7275
Discount allowed 25
Total 7300
(vi) Sales made:
Debtor name Amount Rs.
T 700
A 1000
B 1500
C 2000
Total 5200
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 No.1 for CA/CWA & MEC/CEC MASTER MINDS
PROBLEM NO.5
In the books of Self Ltd.
Total debtors Account
Particulars Rs. Particulars Rs.
To Balance b/d 78,000 By Cash 4,25,000
To Bank (Cheque dishonoured) 7,500 By Discount Allowed 3,000
To B/R (Dishonoured) 2,500 By B/R 20,000
To Interest 1,200 By Returns Inward 8,500
To Sales 4,90,000 By Bad Debts 1,000
To Sundry Creditors (Endorsed By Balance c/d 1,27,275
Bill dishonoured with noting
Charges) 5,575
5,84,775 5,84,775

Total Creditors Account

Particulars Rs. Particulars Rs.
To Cash 1,62,000 By Balance b/d 85,000
To B/R (endorsed) 7,900 By Purchases 2,80,000
To Discount received 2,500 By Sundry Debtors A/c
To Bills Payable 16,000 (endorsed B/R dishonoured
To Return outward 3,700 with noting charges) 5,575
To Balance c/d 1,79,075 By Cash 600
(over payments refunded)

3,71,175 3,71,175

Note: Transactions relating to cash sales or purchases; honour of bills receivable or payable; and
discount or endorsement of bill will not be entered in Total Debtors and Total Creditors A/c.

PROBLEM NO.6
General Ledger
Debtor Ledger Adjustment Account
Date Particulars Amount Date Particulars Amount
2011 To Balance b/d 50,000 2011
Jan 1 Mar 31 By General ledger Adj A/c:
Collection – cash and Bank 1,37,200
Mar 31 To General Ledger Adj A/c: Discount 20,000
Sales [100/120 x(1,80,000 – Bills receivables 30,000
4,800)] 1,46,000 Bad debts (6,000 + 2000) 8,000
Creditors – B/R Dishonoured 6,000 By Balance c/d 14,800
Bank Cheques dishonoured 8,000

2,10,000 2,10,000

Note: 1. Cash collected from debtors (50,000+1,46,000) x70%=1,37,200

2. Cash sales ,bad debts recovered will not appear.

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 Ph: 9885125025/26

PROBLEM NO.7
Total debtors account in the general ledger of M/s. Zee Ltd.
Date Particulars Amount Date Particulars Amount
1.10.11 To balance c/d 77,500 1.10.11 By general ledger Adj. A/c:

1.10.11 To general ledger Adj. A/c: 1.10.11 Cash Collected 38,000

to Sales(84,000-14,000) 70,000 to Bills receivables 26,000
31.3.12 Bills receivables * 31.3.12 Discount allowed 1,000
(bills dishonored) 8,500 Sales return 2,550
Bank (noting charges) * 250

Interest 1,250 By Balance c/d 89,950

1,57,500
1,57,500
Working note:
1. Bad Debts of the year 2009-10 recovered in 2011-12 will not appear in the ‘total debtors account, it
will be credited to Profit & Loss account.

* Note: That information is missing in the problem.

PROBLEM NO.8
Total debtors account
Date Amount Date Amount
Particulars Particulars
2010 Rs. 2010 Rs.
Apr 1 to To Balance b/d Apr 1 to By Balance b/d 20,000
– Advanced by P
(15,000 + 21,000 + 18,000 4,10,000
+ 3,56,000) By Cash A/c (W.N.1) 3,93,000
30 30
To Sales (credit) A/c 4,41,000 By Discount Allowed A/c 9,500
(W.N.2)
(5,55,000 – 1,14,000) 16,500
9,000 By Bad Debts A/c
To Bills Receivable A/c (21,000 – 4,500)
-Dishonored of X 6,000
150 By Returns Inward A/c – by X
To Cash A/c – Noting 9,000
Charges By Bill Receivable A/c - by X
18,000 18,000
To Balance c/d – D By Transfer to Total Creditors A/c
- Z’s Balance
By Balance c/d
X – 9,150
B – 18,000 4,06,150
May 1 May 1 Others – 3,79,000
8,78,150
. By Balance b/d - D 18,000
8,78,150
To Balance b/d 4,06,150

Working Notes:
1. Amount received from Customers:
Particulars Rs.
From Y 4,500
D (advance) 18,000
Add: From other customers before April 1 2,73,000
From sales during the month of April 97,500
3,93,000

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 No.1 for CA/CWA & MEC/CEC MASTER MINDS
2. Discount allowed @ 2½ % on gross amount:
Then net value in % = 97½ (100 - 2½)
21
So, discount on Rs. 3,70,500 (i.e. 2,73,000 + 97,500) will be = Rs. 3,70,500 x 2 = Rs. 9,500
97 12
NOTE: In the problem, a sum of Rs.4,500 was received from T should be read as Y.

PROBLEM NO.9

In General Ledger
Customer Ledger Control A/c
Particulars ` Particulars `
To Balance b/d 2,35,000 By Balance b/d 3,500
To General Ledger By GLA A/c:
Control A/c: Sales returns 15,000
Sales (Credit) 7,65,000 Cash / Cheque received 5,90,000
Cheque dishonour 5,000 Bills receivable 1,10,000
Bills receivable dishonoured 7,000 Discount allowed 9,000
To Balance c/d 3,000 Bad debts 9,000
By Transfer to suppliers A/c 1500
By Transfer to suppliers A/c 1600
By Balance c/d 2,75,400
10,15,000 10,15,000
To Balance b/d 2,75,400 By Balance b/d 3,000

PROBLEM NO.10

Journal Entries
In the books of M/s Big Systematic Ltd.
Particulars L.F. Debit Credit
(i) Mehta (In Sales/ Debtors Ledger) Dr. 8,700
To Mehra (In Sales/ Debtors Ledger) 8,700
(Being amount received from Mehra was wrongly credited to
Mehta, now rectified)
(ii) (a) Suspense Account (In Sales / Debtors Ledger) Dr. 1,000
To Sales Account (In General Ledger) 1,000
(b) Sales/Debtors Ledger Adjustment Account
(In General Ledger) Dr. 1,000
To General Ledger Adjustment Account 1,000
(In Sales/ Debtors Ledger)
(Being rectification of the error resulting from under casting of the
Sales Book)
(iii) (a) M/s. Mega Ltd. A/c (In Creditors/Bought Ledger) Dr. 15,600
To Purchase Returns A/c 15,600
(In General Ledger)
(b) Creditors/Bought Ledger Adjustment A/c Dr. 15,600
(In General Ledger)
To General Ledger Adjustment A/c 15,600
(In Creditors/Bought Ledger)
(Being goods returned to supplier not recorded earlier, now
recorded)

THE END
IPCC_33e_Accounts_Group-I_ Self Balancing Ledgers_Assignment Solutions_________7