16.1. Journal

Try these first

1. 1.

   What is the primary function of a journal in accounting?

   Hint

   Think about the first place where transactions are logged.

2. 2.

   What do we call each record in a journal?

   Hint

   It's a common term used in accounting.

3. 3.

   What is the purpose of a journal in accounting?

   • To summarize financial data
   • To record transactions chronologically
   • To prepare tax returns

   Hint

   Think about its role in the accounting process.

4. 4.

   True or False: Each journal entry involves only one account.

   • True
   • False

   Hint

   Remember the structure of double-entry bookkeeping.

5. 5.

   You have received payment of ₹15,000 for a service provided and incurred ₹2,500 in expenses related to that service. Create the journal entries for these transactions.

   Hint

   You'll need to account for income and expenses separately.

6. 6.

   Prepare a journal entry for a transaction where inventory worth ₹5,000 is purchased on credit.

   Hint

   Remember to record both parts of the transaction.