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Accounting
Accounting is concerned with the uses which accountants might make with bookkeeping information given to them.

Bookkeeping
It is the part of accounting that is concerned with the recording of data. The rule is that any transaction has two entries.
This is known as the double entry system or dual aspect principle
Debit (Dr) the account that receives
Credit (Cr) the account that gives

The Ledger
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Double Entry
CASH AND BANK TRANSACTIONS
Cash transactions occur when money is received or paid immediately.
Bank Transactions occur when money is received and paid by cheque.

Introduction of Capital
Accounting Entries: Dr Cash or Bank
Cr Capital
Jan 1 Ajay began business. He opened a business bank account and invested $80,000 as capital.

Jan 2 Ajay introduced an additional $2,000 in the business cash account.

DR CR
Date Details Amount (RS) Date Details Amount (RS)

Withdrawal of Capital / Drawings

Accounting Entries: Dr Drawings
Cr Cash / Bank

Jan 13 Ajay withdrew cash for personal use $300

Jan 25 Ajay withdrew $175 from the business bank account

DR CR
Date Details Amount (RS) Date Details Amount (RS)
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Capital Expenditure
Accounting Entries: Dr Non-current assets
Cr Cash / Bank

Jan 7 Bought Fixtures and Fittings and paid by cheque $2,500

Jan 9 Bought Equipment for cash $335

DR CR
Date Details Amount (RS) Date Details Amount (RS)

Purchases of goods for resale

Accounting Entries: Dr Purchases
Cr Cash / Bank

Jan 7 Bought goods for resale cash $900

Jan 15 Bought goods and paid by cheque $6,000

DR CR
Date Details Amount (RS) Date Details Amount (RS)
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Sales of goods
Accounting Entries: Dr Cash / Bank
Cr Sales

Jan 9 Sold goods for cash $1,975

Jan 23 Sold goods and received cheque $9,643

DR CR
Date Details Amount (RS) Date Details Amount (RS)

Payment of Expenses
Accounting Entries: Dr Expenses
Cr Cash / Bank

Jan 5 Paid rent cash $324

Jan 8 Bought stationery for cash $132

Jan 24 Paid interest on loan $250 through the bank account

DR CR
Date Details Amount (RS) Date Details Amount (RS)
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CREDIT TRANSACTIONS
Credit transactions is a business transaction that is paid at a later date.

Credit Purchases and Payment to Supplier

Credit purchases are goods bought by a business but for which payment is done later

Accounting entries for credit purchases: DR Purchases

CR Supplier / Trade payables

Accounting entries for payment to supplier: DR Supplier / Trade payables

CR Bank / Cash

Jan 3 Bought goods for resale on credit from James $1000

Jan 7 Bought goods for resale on credit from Beans $1300

Jan 15 Paid James cash $500

Jan 30 Paid Beans by cheque $700

Date Details Amount (RS) Date Details Amount (RS)

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Credit Sales and Receipts from Customer

Credit sales are the sale of goods by a business but for which money is received at a later date.

Accounting entries for credit sales: DR Customer / Trade Receivables

CR Sales

Accounting entries for receipt from customer: DR Cash / Bank

CR Customer / Trade Receivables

Jan 4 Sold goods on credit to David $1500

Jan 10 Sold goods on credit to Milan $800

Jan 16 David paid cash $700

Jan 28 Milan sent a cheque of $600 as part payment of his account

Date Details Amount (RS) Date Details Amount (RS)