*Journalising* Journalise the following transactions: | 2017 | | ₹ | |---|---|---| | Dec. 01 | Hema started business with cash | 1,00,000 | | Dec. 02 | Open a bank account with SBI | 30,000 | | Dec. 04 | Purchased goods from Ashu | 20,000 | | Dec.06 | Sold goods to Rahul for cash | 15,000 | | Dec.10 | Bought goods from Tara for cash | 40,000 | | Dec.13 | Sold goods to Suman | 20,000 | | Dec.16 | Received cheque from Suman | 19,500 | | | Discount allowed | 500 | | Dec.20 | Cheque given to Ashu on account | 10,000 | | Dec.22 | Rent paid by cheque | 2,000 | | Dec.23 | Deposited into bank | 16,000 | | Dec.25 | Machine purchased from Parigya | 10,000 | | Dec.26 | Trade expenses | 2,000 | | Dec.28 | Cheque issued to Parigya | 10,000 | | Dec.29 | Paid telephone expenses by cheque | 1,200 | | Dec.31 | Paid salary | 4,500 |

> [!TLDR] > Hema's fifteen transactions are journalised below with narrations. Bank dealings (cheques received/issued) are routed through Bank A/c; the notable entry is Suman's cheque of ₹19,500 with ₹500 discount allowed. **Treatment.** Cash introduced → Capital. Opening a bank account = Bank Dr., Cash Cr. Credit purchase (Ashu) → Purchases Dr., Ashu Cr.; cash purchase (Tara) → Purchases Dr., Cash Cr. Credit sale (Suman) → Suman Dr., Sales Cr.; on receiving a cheque, Bank and Discount Allowed are debited, Suman credited. Cheques paid to Ashu, for rent, to Parigya and for telephone reduce Bank. Machine bought on credit → Machinery Dr., Parigya Cr. **Journal of Hema** | Date (2017) | Particulars | L.F. | Debit (₹) | Credit (₹) | |---|---|---|---|---| | Dec 01 | Cash A/c **Dr.** | | 1,00,000 | | | | To Capital A/c | | | 1,00,000 | | | (Business started with cash) | | | | | Dec 02 | Bank A/c **Dr.** | | 30,000 | | | | To Cash A/c | | | 30,000 | | | (Bank account opened with SBI) | | | | | Dec 04 | Purchases A/c **Dr.** | | 20,000 | | | | To Ashu A/c | | | 20,000 | | | (Goods purchased from Ashu on credit) | | | | | Dec 06 | Cash A/c **Dr.** | | 15,000 | | | | To Sales A/c | | | 15,000 | | | (Goods sold to Rahul for cash) | | | | | Dec 10 | Purchases A/c **Dr.** | | 40,000 | | | | To Cash A/c | | | 40,000 | | | (Goods bought from Tara for cash) | | | | | Dec 13 | Suman A/c **Dr.** | | 20,000 | | | | To Sales A/c | | | 20,000 | | | (Goods sold to Suman on credit) | | | | | Dec 16 | Bank A/c **Dr.** | | 19,500 | | | | Discount Allowed A/c **Dr.** | | 500 | | | | To Suman A/c | | | 20,000 | | | (Cheque received from Suman, discount allowed) | | | | | Dec 20 | Ashu A/c **Dr.** | | 10,000 | | | | To Bank A/c | | | 10,000 | | | (Cheque given to Ashu on account) | | | | | Dec 22 | Rent A/c **Dr.** | | 2,000 | | | | To Bank A/c | | | 2,000 | | | (Rent paid by cheque) |

*Journalising* Journalise the following transactio – Class 11 Accountancy

Numerical Questions · Q13

Journalising

Journalise the following transactions:

2017		₹
Dec. 01	Hema started business with cash	1,00,000
Dec. 02	Open a bank account with SBI	30,000
Dec. 04	Purchased goods from Ashu	20,000
Dec.06	Sold goods to Rahul for cash	15,000
Dec.10	Bought goods from Tara for cash	40,000
Dec.13	Sold goods to Suman	20,000
Dec.16	Received cheque from Suman	19,500
	Discount allowed	500
Dec.20	Cheque given to Ashu on account	10,000
Dec.22	Rent paid by cheque	2,000
Dec.23	Deposited into bank	16,000
Dec.25	Machine purchased from Parigya	10,000
Dec.26	Trade expenses	2,000
Dec.28	Cheque issued to Parigya	10,000
Dec.29	Paid telephone expenses by cheque	1,200
Dec.31	Paid salary	4,500

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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 of Hema (Dec 2017)

Date	Particulars	Debit (₹)	Credit (₹)
Dec 01	Cash A/c Dr. — To Capital A/c	1,00,000	1,00,000
Dec 02	Bank A/c Dr. — To Cash A/c	30,000	30,000
Dec 04	Purchases A/c Dr. — To Ashu A/c	20,000	20,000
Dec 06	Cash A/c Dr. — To Sales A/c	15,000	15,000
Dec 10	Purchases A/c Dr. — To Cash A/c	40,000	40,000
Dec 13	Suman A/c Dr. — To Sales A/c	20,000	20,000
Dec 16	Bank A/c Dr. / Discount Allowed A/c Dr. — To Suman A/c	19,500 / 500	20,000
Dec 20	Ashu A/c Dr. — To Bank A/c	10,000	10,000
Dec 22	Rent A/c Dr. — To Bank A/c	2,000	2,000
Dec 23	Bank A/c Dr. — To Cash A/c	16,000	16,000
Dec 25	Machinery A/c Dr. — To Parigya A/c	10,000	10,000
Dec 26	Trade Expenses A/c Dr. — To Cash A/c	2,000	2,000

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Hema's fifteen transactions are journalised below with narrations. Bank dealings (cheques received/issued) are routed through Bank A/c; the notable entry is Suman's cheque of ₹19,500 with ₹500 discount allowed.

Treatment. Cash introduced → Capital. Opening a bank account = Bank Dr., Cash Cr. Credit purchase (Ashu) → Purchases Dr., Ashu Cr.; cash purchase (Tara) → Purchases Dr., Cash Cr. Credit sale (Suman) → Suman Dr., Sales Cr.; on receiving a cheque, Bank and Discount Allowed are debited, Suman credited. Cheques paid to Ashu, for rent, to Parigya and for telephone reduce Bank. Machine bought on credit → Machinery Dr., Parigya Cr.

Journal of Hema

Date (2017)	Particulars	Debit (₹)	Credit (₹)
Dec 01	Cash A/c Dr.	1,00,000
	To Capital A/c		1,00,000
	(Business started with cash)
Dec 02	Bank A/c Dr.	30,000
	To Cash A/c		30,000
	(Bank account opened with SBI)
Dec 04	Purchases A/c Dr.	20,000
	To Ashu A/c		20,000
	(Goods purchased from Ashu on credit)
Dec 06	Cash A/c Dr.	15,000
	To Sales A/c		15,000
	(Goods sold to Rahul for cash)
Dec 10	Purchases A/c Dr.	40,000
	To Cash A/c		40,000
	(Goods bought from Tara for cash)
Dec 13	Suman A/c Dr.	20,000
	To Sales A/c		20,000
	(Goods sold to Suman on credit)
Dec 16	Bank A/c Dr.	19,500
	Discount Allowed A/c Dr.	500
	To Suman A/c		20,000
	(Cheque received from Suman, discount allowed)
Dec 20	Ashu A/c Dr.	10,000
	To Bank A/c		10,000
	(Cheque given to Ashu on account)
Dec 22	Rent A/c Dr.	2,000
	To Bank A/c		2,000
	(Rent paid by cheque)
Dec 23	Bank A/c Dr.	16,000
	To Cash A/c		16,000
	(Cash deposited into bank)
Dec 25	Machinery A/c Dr.	10,000
	To Parigya A/c		10,000
	(Machine purchased from Parigya on credit)
Dec 26	Trade Expenses A/c Dr.	2,000

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