Journalizing Transactions in the Books of Atma Ram

Introduction:
In this task, we will journalize transactions in the books of Atma Ram. Journalizing transactions is the process of recording financial transactions in the books of accounts using the double-entry system. It involves identifying the accounts affected by the transaction and recording the corresponding debit and credit entries.

Transactions and Journal Entries:
1. Atma Ram invested Rs. 50,000 cash to start his business.
- Debit: Cash (Rs. 50,000)
- Credit: Capital (Rs. 50,000)

2. Purchased inventory for cash amounting to Rs. 20,000.
- Debit: Inventory (Rs. 20,000)
- Credit: Cash (Rs. 20,000)

3. Bought furniture on credit from XYZ Furniture Store for Rs. 10,000.
- Debit: Furniture (Rs. 10,000)
- Credit: Accounts Payable (Rs. 10,000)

4. Sold goods to a customer for Rs. 15,000 in cash.
- Debit: Cash (Rs. 15,000)
- Credit: Sales Revenue (Rs. 15,000)

5. Paid Rs. 5,000 to a creditor, XYZ Furniture Store, in partial settlement of the amount owed.
- Debit: Accounts Payable (Rs. 5,000)
- Credit: Cash (Rs. 5,000)

6. Atma Ram withdrew Rs. 2,000 cash for personal use.
- Debit: Drawings (Rs. 2,000)
- Credit: Cash (Rs. 2,000)

7. Received Rs. 8,000 from a debtor, Mr. Sharma, in full settlement of his outstanding balance.
- Debit: Cash (Rs. 8,000)
- Credit: Accounts Receivable (Rs. 8,000)

8. Paid rent expense of Rs. 3,000 in cash.
- Debit: Rent Expense (Rs. 3,000)
- Credit: Cash (Rs. 3,000)

9. Recorded depreciation expense on furniture, amounting to Rs. 500.
- Debit: Depreciation Expense (Rs. 500)
- Credit: Accumulated Depreciation - Furniture (Rs. 500)

10. Atma Ram sold furniture for Rs. 6,000, receiving cash.
- Debit: Cash (Rs. 6,000)
- Credit: Furniture (Rs. 6,000)

Conclusion:
Journalizing transactions is a crucial step in the accounting process as it helps record financial transactions accurately and systematically. By following the double-entry system, Atma Ram can maintain a complete record of his business transactions, enabling him to prepare financial statements and make informed business decisions.

Where are the transactions?