Assignment 01 - Grade 11 NEB Home Work

Assignment 1: Principles of Accounting

Grade 11 - Focus Edge Education Network (FEEN)

Section 1: Problem No. 1

The following transactions were provided by Kushal Traders for the month of Magh, 2082. You are required to process these into the accounting cycle.

Magh 01: Started business with Cash Rs. 5,00,000 and Furniture Rs. 1,00,000.

Magh 04: Purchased goods from "Himalayan Suppliers" worth Rs. 80,000 at a 10% Trade Discount.

Magh 08: Deposited Cash Rs. 2,00,000 into the Bank.

Magh 12: Sold goods to "Sita & Co." for Rs. 50,000 on credit.

Magh 15: Goods returned to Himalayan Suppliers worth Rs. 5,000 (Gross).

Magh 20: Received a cheque from Sita & Co. of Rs. 48,000 in full settlement of her account.

Magh 25: Paid Rent Rs. 20,000 and Salaries Rs. 30,000 by cheque.

Magh 28: Withdrew cash Rs. 10,000 from the bank for personal use.

Magh 30: Paid to Himalayan Suppliers by cheque after deducting a 5% Cash Discount.

💡 Hints for Section 1:

• Trade Discount: Deduct from the amount immediately; do not show it in the Journal Entry.
• Full Settlement: Calculate the difference between the actual debt and the payment; the difference is "Discount Allowed" or "Discount Received".
• Drawings: Any withdrawal for personal use must be debited to the "Drawings Account".
• Returns: Remember to deduct the trade discount proportion if the original purchase had one.

Required Tasks for Section 1:

1. Pass the necessary Journal Entries in the books of Kushal Traders.
2. Post the entries into the General Ledger (Cash, Bank, Himalayan Suppliers, and Sales Accounts are mandatory).
3. Prepare a Trial Balance as of 30th Magh, 2082.

--- Please complete Section 1. Await my command for Section 2. ---

Section 2: Problem No. 2

The following transactions were provided by "New Era Trading House" for the month of Falgun, 2082. Record them in the books of original entry and summarize them.

Falgun 02: Commenced business with Cash Rs. 8,00,000 and Bank Balance Rs. 4,00,000.

Falgun 05: Purchased Machinery for Rs. 2,00,000 from "Nepal Engineering Works" on credit.

Falgun 09: Bought goods for Rs. 1,00,000. Half of the payment was made in cash and the rest remains on credit from "ABC Traders".

Falgun 14: Sold goods for Rs. 1,50,000 to "PQR Enterprise" and received a cheque for the full amount, which was immediately deposited into the bank.

Falgun 18: Cash withdrawn from bank for office use Rs. 15,000.

Falgun 22: Paid to Nepal Engineering Works Rs. 1,90,000 in full settlement of their account.

Falgun 25: Paid Insurance Premium Rs. 5,000 and Electricity Bill Rs. 3,000 by cash.

Falgun 27: Goods stolen by an employee worth Rs. 2,000.

Falgun 30: Interest credited by bank Rs. 1,500.

💡 Hints for Section 2:

• Partial Payment: Split the entry into two parts or a compound entry. Debit Purchases and Credit both Cash and the Creditor's account.
• Full Settlement: Since you owed Rs. 2,00,000 but paid Rs. 1,90,000, the remaining Rs. 10,000 is "Discount Received".
• Office Use Withdrawal: This is a contra-entry logic if using a cash book, but in journals, it is Debit Cash and Credit Bank.
• Loss of Goods: Debit "Loss by Theft A/c" and Credit "Purchases A/c" because the inventory reduced without a sale.

Required Tasks for Section 2:

1. Pass the Journal Entries for the above transactions.
2. Prepare Ledger Accounts for: Bank, Machinery, Nepal Engineering Works, and Discount Received.
3. Prepare a Trial Balance as of the end of Falgun.

--- Section 2 Completed. Await my command for Section 3. ---

Section 3: Problem No. 3

The following transactions were provided by "FEEN Educational Supplies" for the month of Chaitra, 2082. This is a comprehensive problem requiring careful analysis of credit terms and asset management.

Chaitra 01: Business started with Cash Rs. 10,00,000, Stock Rs. 2,00,000, and a Loan from Bank of Rs. 5,00,000.

Chaitra 05: Purchased a Delivery Van for Rs. 12,00,000. Paid Rs. 4,00,000 by cheque and the balance through a finance agreement with "Auto Motors".

Chaitra 08: Bought stationery for office use Rs. 5,000 and for resale Rs. 50,000 from "Nepal Paper House".

Chaitra 12: Sold goods to "Kushal & Brothers" worth Rs. 1,20,000 at a 5% Trade Discount. Terms: 2/10, n/30.

Chaitra 15: Kushal & Brothers returned defective goods worth Rs. 10,000 (List Price).

Chaitra 19: Received a cheque from Kushal & Brothers for the amount due after they availed the cash discount.

Chaitra 22: A debt of Rs. 8,000 previously written off as "Bad Debt" last year was unexpectedly recovered in cash.

Chaitra 25: Paid "Auto Motors" Rs. 1,00,000 as an installment for the Delivery Van via Bank.

Chaitra 27: Distributed goods worth Rs. 4,000 as free samples for advertisement purposes.

Chaitra 30: Withdrew goods for Rs. 3,000 and Cash Rs. 2,000 for the proprietor's household use.

💡 Hints for Section 3 (Advanced):

• Loan as Capital: The loan increases your Cash (Debit) but also creates a Liability (Credit). Total Capital is (Assets - Liabilities).
• Stationery: Stationery for office use is an "Expense," while stationery for resale is "Purchases."
• Cash Discount (2/10, n/30): This means a 2% discount is given if paid within 10 days. Calculate this on the remaining balance after returns.
• Bad Debt Recovered: This is a gain. Debit Cash and Credit "Bad Debt Recovered A/c." Do not credit the personal account of the debtor.
• Free Samples: Debit "Advertisement A/c" and Credit "Purchases A/c."

Required Tasks for Section 3:

1. Journalize the above transactions with proper narrations.
2. Prepare Ledger Accounts for: Cash, Purchases, Kushal & Brothers, and Delivery Van.
3. Prepare a Trial Balance to verify the arithmetical accuracy of the books.

--- Section 3 Completed. Await my command for Section 4 (MCQs & Final Guidelines). ---

Section 4: 25 Accounts MCQs (Tick Mark Questions)

Instructions: Select the correct option. Use the hints provided to master the logic of double-entry bookkeeping.

1. Which of the following is a "Real Account"?

A) Salary A/c

B) Machinery A/c

C) Capital A/c

D) Rent A/c

Hint: Real accounts relate to assets and properties that can be seen or touched.

2. Drawings by the proprietor results in:

A) Increase in Capital

B) Decrease in Capital

C) Increase in Assets

D) No change in Capital

Hint: Drawings are the reverse of capital; they reduce the owner's equity in the business.

3. Purchase of furniture for cash should be debited to:

A) Cash A/c

B) Furniture A/c

C) Purchase A/c

D) Sales A/c

Hint: According to the Real Account rule, "Debit what comes in." Furniture is coming in.

Figure 8: Modern Classification for Journal Entries

4. A Journal is a book of:

A) Final Entry

B) Original Entry

C) Secondary Entry

D) Summary

Hint: It is the first place where a transaction is recorded chronologically.

5. Trade discount is:

A) Recorded in Journal

B) Not recorded in Journal

C) Recorded in Ledger

D) Only recorded in Cash Book

Hint: Trade discount is deducted from the list price before the transaction is recorded.

6. Ledger is a book of:

A) Preliminary Entry

B) Original Entry

C) Final Entry

D) Rough Entry

7. The process of transferring entries from Journal to Ledger is called:

A) Journalizing

B) Balancing

C) Posting

D) Totaling

8. A Trial Balance is prepared to check:

A) Financial Position

B) Arithmetical Accuracy

C) Net Profit

D) Cash Balance

9. Salary outstanding account is a:

A) Real Account

B) Nominal Account

C) Personal Account

D) Asset Account

Hint: It represents a liability to a person or group of persons.

10. Trial balance contains the balances of:

A) Only Real A/c

B) Only Personal A/c

C) Only Nominal A/c

D) All Ledger Accounts

[Questions 11-25: Testing Depreciation, Rectification, and Cash Book Concepts...]

Assignment Submission Portal

Final Instructions for Students:

• Ensure that the Debit and Credit totals of your Trial Balance match for all three sections.
• Narrations for Journal Entries are mandatory.
• Submit your assignment in PDF format via the FEEN Portal.

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