Question 1: Startup Business – Mr.
Verma Enterprises
Background:
Mr. Verma started a new trading business called Verma Enterprises on 1st April 2025. The
following transactions took place during the first month of operations:
Date Transaction Description
Apr 01 Mr. Verma started business with ₹3,00,000 in cash.
Apr 02 Deposited ₹2,00,000 into the business bank account.
Apr 03 Purchased goods worth ₹80,000 from Ram Traders on credit.
Apr 05 Bought office furniture for ₹25,000 and paid by cheque.
Sold goods for ₹50,000 on credit to Shyam Stores (cost
Apr 08
₹30,000).
Apr 10 Paid ₹10,000 to Ram Traders in cash.
Apr 12 Received ₹45,000 from Shyam Stores as part payment.
Apr 15 Paid rent of ₹12,000 for the month.
Apr 20 Withdrew ₹5,000 from business for personal use.
Apr 28 Paid salaries of ₹18,000 to staff.
Instructions:
You are required to:
1. Journal Entries:
Record all transactions in the journal of Verma Enterprises with proper narration.
2. Ledger Posting:
Post the journal entries into the following Ledger Accounts:
o Cash Account
o Bank Account
o Capital Account
o Ram Traders Account
o Shyam Stores Account
o Purchases Account
o Sales Account
o Furniture Account
o Rent Account
o Salaries Account
o Drawings Account
3. Trial Balance:
Prepare the Trial Balance as of April 30, 2025 using the closing balances from the
ledgers.
4. Trading & Profit & Loss Account:
Prepare the Trading and Profit & Loss Account for April 2025 with the following
adjustments:
o Closing Stock: ₹25,000
o No returns or depreciation
5. Balance Sheet:
Prepare the Balance Sheet as on April 30, 2025, after accounting for all assets,
liabilities, and adjusted capital.
Question 2: Service Firm – TechAssist Solutions
Background:
Tech Assist Solutions is a small IT services firm that commenced operations on 1st May
2025. The following transactions occurred during the month:
Date Transaction Description
May 01 Capital introduced by the owner ₹5,00,000.
May 03 Office equipment purchased for ₹75,000; payment made by bank transfer.
May 06 Paid advance rent of ₹36,000 for 3 months.
May 10 Provided services to clients and raised invoices worth ₹1,50,000.
May 12 Paid internet and electricity bills ₹3,000.
May 15 Received ₹90,000 from clients against invoices.
May 18 Purchased office stationery ₹2,000 in cash.
May 22 Paid ₹25,000 as monthly salaries to employees via bank.
May 25 Received ₹30,000 in advance from a client for services to be provided in June.
May 30 Owner withdrew ₹10,000 from business cash for personal use.
Instructions:
You are required to:
1. Journal Entries:
Record the transactions with proper narrations in the books of TechAssist Solutions.
2. Ledger Posting:
Post entries into the following Ledger Accounts:
o Cash Account
o Bank Account
o Capital Account
o Office Equipment Account
o Rent Account
o Service Revenue Account
o Accounts Receivable (Debtors)
o Internet & Electricity Expense Account
o Stationery Expense Account
o Salaries Account
o Advance from Customer (Unearned Revenue)
o Drawings Account
3. Trial Balance:
Prepare a Trial Balance as of May 31, 2025 using the ledger balances.
4. Income Statement:
Prepare the Income Statement (Profit & Loss Account) for May 2025, considering:
o Rent paid for 3 months → expense only 1 month
o Advance from the customer is unearned revenue
o No depreciation this month
o Revenue includes ₹1,50,000 (₹90,000 received, rest is receivable)
5. Balance Sheet:
Prepare the Balance Sheet as of May 31, 2025, showing:
o Assets: Cash, Bank, Debtors, Office Equipment, Prepaid Rent
o Liabilities: Advance from Customer
o Capital adjusted for drawings and net profit
Question 3: Meera Fashion House – Sole Proprietor
Background:
Meera started a boutique business, Meera Fashion House, on July 1, 2025. The following
transactions were recorded during the first month.
Date Transaction Description
Jul 01 Started business with ₹4,00,000 cash
Jul 03 Deposited ₹3,00,000 in the bank
Bought garments for resale worth ₹1,20,000 (₹70,000 cash; ₹50,000 on
Jul 05
credit)
Jul 08 Sold garments for ₹1,50,000 (₹90,000 on credit; cost ₹1,00,000)
Jul 10 Paid ₹20,000 to supplier by cheque
Jul 12 Paid advertisement expense ₹8,000 in cash
Jul 15 Received ₹60,000 from customers
Jul 18 Paid monthly rent ₹15,000 through bank
Jul 22 Purchased a computer for office use ₹35,000 (by bank)
Jul 25 Paid staff salaries ₹20,000 in cash
Jul 28 Withdrew ₹10,000 for personal use
Instructions:
You are required to:
1. Journal Entries:
Record all transactions with narration.
2. Ledger Accounts:
Prepare the following:
o Cash
o Bank
o Capital
o Purchases
o Sales
o Debtors
o Creditors
o Rent
o Advertisement Expense
o Salaries
o Computer (Asset)
o Drawings
3. Trial Balance:
As on July 31, 2025
4. Trading & P&L Account:
For July 2025 with:
o Closing stock: ₹40,000
o No depreciation applicable
5. Balance Sheet:
As on July 31, 2025, including all adjustments.
Question 4: CloudSync Technologies – Service-Based
Partnership
Background:
CloudSync Technologies, a software development firm, is formed by two partners. It
began operations on June 1, 2025. The following are the transactions for the month of
June.
Date Transaction Description
Partners invested ₹6,00,000 in total (₹3,00,000 each) – deposited in
Jun 01
bank
Jun 04 Purchased office furniture worth ₹80,000 by bank transfer
Jun 06 Paid 6-month office rent in advance ₹60,000
Jun 10 Billed clients for software services worth ₹2,50,000
Jun 12 Received ₹1,50,000 from clients
Jun 15 Paid salaries ₹30,000
Jun 20 Purchased software license (1 year) ₹24,000
Jun 22 Paid ₹5,000 for domain and hosting charges
Jun 25 Partner A withdrew ₹10,000, Partner B withdrew ₹5,000
Jun 28 Paid internet & maintenance expenses ₹4,000
Instructions:
You are required to:
1. Journal Entries:
Pass journal entries with narrations.
2. Ledger Accounts:
Prepare the following:
o Bank
o Capital (Partner A and B)
o Furniture
o Rent (Prepaid)
o Software License (Asset)
o Service Revenue
o Debtors
o Salaries
o Internet & Maintenance Expense
o Domain/Hosting Expense
o Drawings A / Drawings B
3. Trial Balance:
As of June 30, 2025
4. Income Statement (P&L):
For June 2025, with:
o Rent expense for only 1 month
o No depreciation
o Prepaid software license shown as an asset
5. Balance Sheet:
As of June 30, 2025, with adjustments.
