Page 127 - Book-keeping for Secondary Schools Student’s Book Form One

Trial balance

11 Purchased goods on credit from ABC LTD worth TZS 240,000
12 Sold goods in cash worth TZS 130,000
14 Returned goods to Madina worth TZS 150,000 because they were faulty
15 Mahinda returned goods worth TZS 10,000
18 Paid Madina TZS 350,000 by cheque
FOR ONLINE READING ONLY
20 Received cash from Mahinda worth TZS 80,000
24 Paid wages in cash TZS 50,000
26 Jamal drew TZS 200,000 from the business account for private use;

28 Received TZS 50,000 cash for rent
31 Paid ABC LTD TZS 210,000 by cheque

In this kind of situation, the first step, involves the application of the double entry
principle to make entries in the general journal, post the entries to the general ledger,
and balance the ledger accounts. The second step will involve extracting the debit and
credit balances from the general ledger accounts for the trial balance. The solution is
shown as follows.

Solution
Journal entries

Date Details Dr Cr

1-Jan-20 Bank 13,500,000
Capital 13,500,000
Being capital deposited in the bank by the
owner

2-Jan-20 Building 7,500,000
Bank 5,000,000
Other payables (Kamara) 2,500,000
Being for a building acquired for TZS
7,500,000 with TZS 5,000,000 cheque issued
4-Jan-20 Furniture 250,000
Bank 250,000
Being a cheque issued to buy furniture
5-Jan-20 Purchases 500,000
Trade payables 500,000
Being goods purchased on credit
8-Jan-20 Bank 600,000
Capital 600,000

119

Book Keeping Form 1 New 2024 FINAL.indd 119 18/10/2024 10:14