Accounts Cheat

Sheet
------------------------------------------------------------------------------
----------------

 Asset=Liabilities+Capital

 Liabilities=Asset−Capital

 Capital=Asset −Liabilities

Accounting Equation
Incomes=¿
Expenditures=¿

Commission Paid=¿Withdraws=¿

O/s Expenditure: Column On Liabilities & (-) Capital

O/s Income: Column On Assets & (+) Capital
Prepaid Expenditure: Column On Assets & (-) Cash
Prepaid Income: Column On Liabilities & (+) Cash

Cost Price: ( - ) Stock

Sale Price: ( + ) Cash
Profit: ( + ) Capital
Loss: ( - ) Capital
Profit = Closing Capital + Drawings – A/C – Opening Capital
 Total Assets = Liabilities + Capital + Profit
Total Liability = Owners Capital at end + creditors
Owners Capital at end = Capital in start + revenue + expenditure
Opening Capital = Closing capital + drawings – A/C – profits
Closing Capital = Opening capital + A/C + profit – drawing

Personal A/c Real A/c Nominal A/c

Bank Cash Sales

O/s Salaries Leasehold property Discount Received
Accrued Interest Plant & Machinery Bad debts written off
Drawings Goodwill Purchases
Capital Bad debts recovered
Overdraft Interest paid
Prepaid rent Carriage inwards
Discount allowed
Rent received

Account Debit Credit

Personal Receiver Giver

Real What comes in What goes out
Nominal Expense / Loss Income / Gain

Journal

Cash deposited in bank:

 Bank A/c to Cash A/c
Cash withdrawn from bank:
Cash A/c to Bank A/c
Cheque Received from customer:
Cheque in hand A/c to Customer A/c
Cheque Deposited into bank:
Bank A/c to Cheque in hand A/c
Cheque Received and immediately deposited:
Bank A/c to Customer A/c
Cheque Dishonored:
Customer A/c to Bank A/c
Drawings out of bank:
Drawing A/c to Bank A/c
Expenses paid through cheque:
Expense A/c to Bank A/c
Creditor paid through cheque:
Creditor A/c to Bank A/c
Interest charged by bank:
Interest A/c to Bank A/c
Interest Received in Bank:
Bank A/c to Interest A/c
Interest allowed by bank:
Bank A/c to Interest received A/c
Bank Charges for service:
Bank charges A/c to Bank A/c
Bad Debts:
Bad debts A/c to Debtor A/c
Bad Debts recovered:
Cash A/c to Bad debts recovered A/c
Outstanding expenditure:
Expenditure A/c to O/s Exp
Pre-Paid Incomes:
Incomes A/c to Prepaid A/c
Outstanding Income:
O/s income A/c to Income A/c
Pre-Paid Expenditure:
Prepaid expenditure A/c to Expenditure A/c
Depreciation:
Depreciation A/c to Asset A/c
Interest On Capital:
Interest on capital A/c to Capital A/c
Interest on drawings:
Drawings A/c to Interest on drawings A/c

Cash Book
- Dr  Inflow ( + )
 - Cr  Outflow ( - )

Double Column Cash Book

+ Contra Entries

- Cash Deposited In Bank

Bank ( + ) | Cash ( - )
To cash By bank

- Cash Withdrawn From Bank

Bank ( - ) | Cash ( + )
To Bank by Cash

______________________________________________________________________
 Input CGST/IGST/SGST [ For purchases ]
 Output CGST/SGST/IGST [ For sales ]
______________________________________________________________________
List Price
( - ) Less Cash Discount
( - ) Less Trade Discount
( + ) Add CGST/SGST/IGST

Bank Reconciliation Statement

- Cash Book  Dr ( + ) Cr ( - )
- Pass Book  Dr ( - ) Dr ( - )

Particular Add (+) Subtract (-)

Fav/ Dr Bal as per cash book +

Unfav/ Cr Bal as per pass book -

Cheque issued but not presented ++

Increase in bank balance ++

Cheque deposited but not credited --

Decrease in bank balance --

If starting with balance as per passbook:

- All items added will be subtracted
- All items subtracted will be added

Trial Balance
 Entries
Particular Dr Cr
Drawings
Rent Purchase Return
Sales Return
Cash Sundry receipts
Building Capital
Furniture o/s expenses
Debtor Bills payable
Bad debts Creditor
investments Loan
Salary Return outward
Interest Interest received
Insurance premium Commission
Discount allowed Discount Received
Premises Bank overdraft
Cash in hand Provision for
depreciation
Carriage outwards Carriage inwards
Purchases Sales
Trade expenses Provision for doubtful
debts
Prepaid expenses o/s salaries
Opening stock
 Rectification of Errors

Nature Of Account:
 Purchase ( Dr )
 Sales ( Cr )
 Purchase returns ( Cr)
 Sales returns ( Dr )

Undercast: Follows the same nature of accounts.

 Purchase A/c To Suspense A/c
 Suspense A/c to Sales A/c
 Suspense A/c to Purchase return A/c
 Sales Return A/c to Suspense A/c

Overcast: Follows the reverse nature of accounts.

 Suspense A/c to Purchase A/c
 Sales A/c to Suspense A/c
 Purchase Return A/c to Suspense A/c
 Suspense A/c to Sale Returns A/c

Important Types Of Errors:

- Error Of Omission: [ Forgotten ]
Error Of Commission: [ Wrong Amount/ Side ]
 Error Of Principle: [ Wrong Basics ]
Compensating Errors: [ One corrects another ]
Depreciation

Cost + Expenses−Scrap Value

Depreciation Formula: Expected Lifetime

(% )
Depreciation percentage: y x 100

For specific months of depreciation charged:

( Months)
Depreciation x 12

Cost – Depreciation = Expectation

Expectation – Sale = Profit / Loss
__________________________________________________________
 Final Accounts
Net Sales = Total Sales – Sales Return
Net Purchases = Purchases – Purchase Returns
Cost of Goods sold = Opening stock + Net purchases + Direct exp –
Closing Stock
Adjusted purchases = Opening stock + Net purchases – Closing Stock
Gross Profit = Net sales – cost of golds sold
__________________________________________________________
Trading A/c
Particular Amt Particular Amt

To opening stock
To purchases By Sales
(-) Returns o/w (-) Return Inward
(-) Drawings
(-) Sample exp
(-) Donation
(-) Loss of stock
To wages By scrap sales
To Freight / By Closing Stock
Carriage Inward
To Factory By Gross loss
To Dock Charges
To Fuel Power
To Gross profit
 Profit & Loss

To insurance By Commission
To General charge By Discount recv.
To Salaries By interest on
investments
To Bad debts
To Advertisements
To Interest
To Bank charges
To Discount allowed
To Rent
To Freight o/w
To Carriage o/w Net loss
To Repairs
To Depreciation
 Balance Sheet
Liabilities Assets
Capital
( + ) Net Profit
( - ) Net loss
( - ) Drawings
Bank loan Building
Sundry creditors Machinery
( - ) Depreciation
Bank overdraft Sundry debtors
( - ) Bad debts
Bills Payable Cash @ Bank
Cash in Hand
O/s expenditure Bills receivable
Prepaid Income Motor/Furniture
Bank
O/s Income
Prepaid Exp
Closing Stock

______________________________________________________________________
Bad debts
(+) New / Further Bad debts
 (+) New Provision
(-) Old Provision
New Provision = Sundry Debtors – Further bad debts
o/s is added ( + ) | prepaid is subtracted ( - )
Adjustments
Closing Stock Trading A/c {Cr} Balance sheet {A}

O/s Expenses Expenses + Balance Sheet {L}

Pre-Paid Exp Expenses - Balance sheet {A}

O/s | Accrued Income Income + Balance sheet {A}

[ P/ L –> CR + ]

Pre-Paid Income Income - Balance Sheet {L}

[ P/ L –> CR - ]

Depreciation P/l {Dr} Balance sheet {A}

Interest On Capital P/l {Dr} Capital +

Interest on Drawing P/l {Cr} Capital -

Interest on Loan P/l {Dr} Balance Sheet {L}

Bad Debts P/l {Dr} Debtor -

Further Bad Debts P/l {Dr} + Debtor -

Prov. for Bad Debts P/l {Dr} + Debtor -

[ - Old Provision ]

Prov. for Discount on P/l {Dr} + Debtor -

debtors

Unnatural loss of stock Purchases {Dr} – P/l {Dr}

Full claim receivable Purchases {Dr} – Balance sheet {A}
Partial claim receivable Purchases {Dr} – (Received in B/s)(loss in p/l)
 Charity Of Goods Purchases {Dr} – P/l {Dr}

Goods given as sample Purchases {Dr} – P/l {Dr}

Drawings in goods Purchases {Dr} – Capital – or Drawings+

Goods purchased and Purchases {Dr} + Creditor +

omitted to record
Managers P/L {Dr} B/s {L}
Commission
If Before Charging Such commission:
N/P (net profit) x 10/100

If After Charging Such commission:

N/P x Rate / 100 + (Rate)

If Allow % interest on capital and charge Rs.X as interest on

drawings then:

Calculate % Interest on Capital

[ In P/L (Dr) ] and [ In B/s + Capital ]

( - ) Rs.X Drawings from B/s

[ In P/L (Cr)+ ]

Write of 1/5th of Advertisements [Eg:]

The written off amount (1/5th) in P/L

and the remaining amount in balance sheet