16. Journal, Ledger, and Trial Balance

Try these first

1. 1.

   What is the purpose of a Journal in accounting?

   Hint

   Think about where transactions are first logged.

2. 2.

   Define a Ledger.

   Hint

   Consider what happens after transactions are recorded in the Journal.

3. 3.

   What is the primary purpose of a Journal?

   • To summarize transactions
   • To record transactions
   • To create financial statements

   Hint

   Consider where transactions are first documented.

4. 4.

   A Trial Balance is used to check the accuracy of which?

   • True: Debit equals Credit
   • False: Debit does not equal Credit

   Hint

   Recap the definition we discussed about the Trial Balance.

5. 5.

   A journal entry records a sale of ₹10,000 in cash. After posting to the Ledger, a Trial Balance shows Cash at ₹8,000 and Sales at ₹10,000. What kind of error can be inferred from this scenario?

   Hint

   Consider what could cause the Cash figure to be understated.

6. 6.

   Create a Trial Balance for the following accounts and ensure it balances:

   • Cash A/c: ₹5,000
   • Sales A/c: ₹5,000
   • Expenses A/c: ₹2,000
   • Liabilities A/c: ₹3,000

   Hint

   Calculate both sides and consider adjustments needed to achieve balance.