*Posting* Journalise the following transactions, post to the ledger: | 2017 | | ₹ | |---|---|---| | Nov. 01 | Business started with (i) Cash | 1,50,000 | | | (ii) Goods | 50,000 | | Nov. 03 | Purchased goods from Harish | 30,000 | | Nov. 05 | Sold goods for cash | 12,000 | | Nov. 08 | Purchase furniture for cash | 5,000 | | Nov. 10 | Cash paid to Harish on account | 15,000 | | Nov. 13 | Paid sundry expenses | 200 | | Nov. 15 | Cash sales | 15,000 | | Nov. 18 | Deposited into bank | 5,000 | | Nov. 20 | Drew cash for personal use | 1,000 | | Nov. 22 | Cash paid to Harish in full settlement of account | 14,700 | | Nov. 25 | Good sold to Nitesh | 7,000 | | Nov. 26 | Cartage paid | 200 | | Nov. 27 | Rent paid | 1,500 | | Nov. 29 | Received cash from Nitesh | 6,800 | | | Discount allowed | 200 | | Nov. 30 | Salary paid | 3,000 |

> [!TLDR] > The transactions are journalised and posted to the ledger. Goods brought in at start are taken as **Stock ₹50,000**; Harish (creditor) is settled with ₹300 discount received, Nitesh (debtor) with ₹200 discount allowed; **Cash A/c closes at ₹1,38,200 (Dr)**. **Journal** | Date (2017) | Particulars | L.F. | Debit (₹) | Credit (₹) | |---|---|---|---|---| | Nov 01 | Cash A/c **Dr.** | | 1,50,000 | | | | Stock A/c **Dr.** | | 50,000 | | | | To Capital A/c | | | 2,00,000 | | | (Business started with cash and goods) | | | | | Nov 03 | Purchases A/c **Dr.** | | 30,000 | | | | To Harish A/c | | | 30,000 | | | (Goods purchased from Harish) | | | | | Nov 05 | Cash A/c **Dr.** | | 12,000 | | | | To Sales A/c | | | 12,000 | | | (Goods sold for cash) | | | | | Nov 08 | Furniture A/c **Dr.** | | 5,000 | | | | To Cash A/c | | | 5,000 | | | (Furniture purchased for cash) | | | | | Nov 10 | Harish A/c **Dr.** | | 15,000 | | | | To Cash A/c | | | 15,000 | | | (Cash paid to Harish on account) | | | | | Nov 13 | Sundry Expenses A/c **Dr.** | | 200 | | | | To Cash A/c | | | 200 | | | (Sundry expenses paid) | | | | | Nov 15 | Cash A/c **Dr.** | | 15,000 | | | | To Sales A/c | | | 15,000 | | | (Cash sales) | | | | | Nov 18 | Bank A/c **Dr.** | | 5,000 | | | | To Cash A/c | | | 5,000 | | | (Cash deposited into bank) | | | | | Nov 20 | Drawings A/c **Dr.** | | 1,000 | | | | To Cash A/c | | | 1,000 | | | (Cash drawn for personal use) | | | | | Nov 22 | Harish A/c **Dr.** | | 15,000 | | | | To Cash A/c | | | 14,700 | | | To Discount Received A/c | | | 300 | | | (Balance paid to Harish in full settlement) | | | | | Nov 25 | Nitesh A/c **Dr.** | | 7,000 | | | | To Sales A/c | | | 7,000 | | | (Goods sold to Nitesh) | | | | | Nov 26 | Cartage A/c **Dr.** | | 200 | | | | To Cash A/c | | | 200 | | | (Cartage paid) | | | | | Nov 27 |

*Posting* Journalise the following transactions, p – Class 11 Accountancy

Numerical Questions · Q16

Posting

Journalise the following transactions, post to the ledger:

2017		₹
Nov. 01	Business started with (i) Cash	1,50,000
	(ii) Goods	50,000
Nov. 03	Purchased goods from Harish	30,000
Nov. 05	Sold goods for cash	12,000
Nov. 08	Purchase furniture for cash	5,000
Nov. 10	Cash paid to Harish on account	15,000
Nov. 13	Paid sundry expenses	200
Nov. 15	Cash sales	15,000
Nov. 18	Deposited into bank	5,000
Nov. 20	Drew cash for personal use	1,000
Nov. 22	Cash paid to Harish in full settlement of account	14,700
Nov. 25	Good sold to Nitesh	7,000
Nov. 26	Cartage paid	200
Nov. 27	Rent paid	1,500
Nov. 29	Received cash from Nitesh	6,800
	Discount allowed	200
Nov. 30	Salary paid	3,000

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Concept understanding — Purchase Journal Entry

Purchase Journal Entry – A First Look

Think of a shopkeeper who buys goods to sell. Every time they bring stock into the shop, something changes: the shop now has more goods, but it also owes money (or has paid cash). The purchase journal entry is simply the accountant’s way of recording that moment — the moment goods come in.

The Everyday Intuition

You walk into a stationery shop and buy 50 notebooks for ₹2,000. From the shop’s point of view, two things happen at once:

The shop gains notebooks (an asset).
The shop loses cash (another asset) or owes the supplier (a liability).

The purchase entry captures both sides of that single transaction. It is not about the sale to a customer — that comes later. This is the inward movement of goods meant for resale.

The Precise Meaning

In Accountancy, a Purchase Journal Entry records the credit purchase of goods (stock-in-trade) for resale in the normal course of business. If the purchase is for cash, it goes into the Cash Book, not the Purchase Journal. The Purchase Journal (also called the Purchase Book) is specifically for credit purchases of goods.

Important

Only goods bought for resale are recorded here. Buying a computer for office use, or buying raw materials for manufacturing, is not a “purchase” in this sense — those are asset purchases and go elsewhere.

Why It Matters

Without this entry, the business would not know:

How much stock it holds.
How much it owes to each supplier.
The true cost of goods sold when calculating profit.

The Purchase Journal is the first step in the trading account. If you get this entry wrong, the entire profit figure goes wrong.

Accounting Treatment – The Golden Rule

For a credit purchase of goods, the rule is:

Debit Purchases Account (increase in expenses/goods)

Credit Supplier’s Personal Account (increase in liability)

The logic: Purchases is a nominal account (expense), so an increase is debited. The supplier is a personal account — when we owe them, we credit.

Example

On 5th April, bought goods from Ramesh for ₹10,000 on credit.

Journal Entry:

Date	Particulars	Debit (₹)	Credit (₹)
2024 Apr 5	Purchases A/c Dr.	10,000
	To Ramesh A/c		10,000
	(Being goods bought on credit from Ramesh)

Note

The narration “Being goods bought on credit from Ramesh” is mandatory in the journal. It explains the transaction in plain words.

If It Were a Cash Purchase

If the same goods were bought for cash, the entry would be:

Date	Particulars	Debit (₹)	Credit (₹)
2024 Apr 5	Purchases A/c Dr.	10,000
	To Cash A/c		10,000
	(Being goods bought for cash)

Notice: the credit side changes from a personal account (Ramesh) to a real account (Cash). The debit remains the same because the nature of the transaction — gaining goods — is unchanged.

The Purchase Book Format (Proforma)

The Purchase Journal itself (the book of original entry) has a standard format. Each credit purchase is recorded here before being posted to the ledger.

Purchase Book (Journal) Format: …

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Journal (Nov 2017) — main entries:

Date	Particulars	Debit (₹)	Credit (₹)
Nov 01	Cash A/c Dr. / Stock A/c Dr. — To Capital A/c	1,50,000 / 50,000	2,00,000
Nov 03	Purchases A/c Dr. — To Harish A/c	30,000	30,000
Nov 05	Cash A/c Dr. — To Sales A/c	12,000	12,000
Nov 08	Furniture A/c Dr. — To Cash A/c	5,000	5,000
Nov 10	Harish A/c Dr. — To Cash A/c	15,000	15,000
Nov 13	Sundry Expenses A/c Dr. — To Cash A/c	200	200
Nov 15	Cash A/c Dr. — To Sales A/c	15,000	15,000
Nov 18	Bank A/c Dr. — To Cash A/c	5,000	5,000
Nov 20	Drawings A/c Dr. — To Cash A/c	1,000	1,000
Nov 22	Harish A/c Dr. — To Cash A/c / Discount Received A/c	15,000	14,700 / 300
Nov 25	Nitesh A/c Dr. — To Sales A/c	7,000	7,000
Nov 26	Cartage A/c Dr. — To Cash A/c	200	200
Nov 27	Rent A/c Dr. — To Cash A/c	1,500	1,500

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The transactions are journalised and posted to the ledger. Goods brought in at start are taken as Stock ₹50,000; Harish (creditor) is settled with ₹300 discount received, Nitesh (debtor) with ₹200 discount allowed; Cash A/c closes at ₹1,38,200 (Dr).

Journal

Date (2017)	Particulars	Debit (₹)	Credit (₹)
Nov 01	Cash A/c Dr.	1,50,000
	Stock A/c Dr.	50,000
	To Capital A/c		2,00,000
	(Business started with cash and goods)
Nov 03	Purchases A/c Dr.	30,000
	To Harish A/c		30,000
	(Goods purchased from Harish)
Nov 05	Cash A/c Dr.	12,000
	To Sales A/c		12,000
	(Goods sold for cash)
Nov 08	Furniture A/c Dr.	5,000
	To Cash A/c		5,000
	(Furniture purchased for cash)
Nov 10	Harish A/c Dr.	15,000
	To Cash A/c		15,000
	(Cash paid to Harish on account)
Nov 13	Sundry Expenses A/c Dr.	200
	To Cash A/c		200
	(Sundry expenses paid)
Nov 15	Cash A/c Dr.	15,000
	To Sales A/c		15,000
	(Cash sales)
Nov 18	Bank A/c Dr.	5,000
	To Cash A/c		5,000
	(Cash deposited into bank)
Nov 20	Drawings A/c Dr.	1,000
	To Cash A/c		1,000
	(Cash drawn for personal use)
Nov 22	Harish A/c Dr.	15,000
	To Cash A/c		14,700
	To Discount Received A/c		300
	(Balance paid to Harish in full settlement)
Nov 25	Nitesh A/c Dr.	7,000
	To Sales A/c		7,000
	(Goods sold to Nitesh)
Nov 26	Cartage A/c Dr.	200
	To Cash A/c		200
	(Cartage paid)
Nov 27	Rent A/c Dr.	1,500
	To Cash A/c		1,500
	(Rent paid)
Nov 29	Cash A/c Dr.	6,800
	Discount Allowed A/c Dr.	200
	To Nitesh A/c		7,000
	(Cash received from Nitesh, discount allowed)
Nov 30	Salary A/c Dr.	3,000
	To Cash A/c		3,000
	(Salary paid)

Ledger (principal accounts)

Cash Account

Particulars	Amount (₹)	Particulars	Amount (₹)
To Capital	1,50,000	By Furniture	5,000
To Sales (Nov 05)	12,000	By Harish	15,000
To Sales (Nov 15)	15,000	By Sundry Expenses	200
To Nitesh	6,800	By Bank	5,000
		By Drawings	1,000
		By Harish	14,700
		By Cartage	200
		By Rent	1,500
		By Salary	3,000
		By Balance c/d	1,38,200
Total	1,83,800	Total	1,83,800

Harish Account

Particulars	Amount (₹)	Particulars	Amount (₹)
To Cash	15,000	By Purchases	30,000

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