CA-CPT Fundamentals of Accounts Chapter 2 Unit-2

By CA. SK Chhabra

What are ledgers

After recording the transaction in the Journal recorded transaction are

classified and grouped into accounts known as ledger.

Ledger is an account book which contains all account heads, which are opened in Journal/Subsidiary books

Helps to identify the list of transactions under a particular account head and helps in ascertaining the status of the account

For example cash A/c contains all transactions involving cash

Principal Book

Secondary Book of entry

Book of Final entry

DATE PARTICULARS J.F ` DATE PARTICULARS J.F. `

It Refers to transferring the debit and credit

item from Journal to classified accounts

in the ledger is known as posting.

•The technique of finding the net balance of an account after considering the total of both debit and credit appearing in the account

Balancing of an account

• Journal and Ledger records transaction in a chronological order that is in date wise manner

Chronological order

•Ledger book is popularly known as principal book of accounts and records transactions in analytical order respectively

Principal books of accounts

Multiple choice Questions

The process of transferring the debit and credit items from a Journal to their respective accounts in the ledger is termed as

• (a) Posting • (b) Purchase • (c) Balancing of an account • (d) Arithmetically accuracy test

Answer: (a)

The technique of finding the net balance of an account after considering the totals of both debits and credits appearing in the account is known as

• (a) Posting • (b) Purchase • (c) Balancing of an account • (d) Arithmetically accuracy test.

Answer: (c)

Journal and ledger records transactions in

• (a) A chronological order and analytical order respectively. • (b) An analytical order and chronological order respectively. • (c) A chronological order only • (d) An analytical order only

Answer: (a)

Ledger book is popularly known as

• (a) Secondary book of accounts • (b) Principal book of accounts • (c) Subsidiary book of accounts • (d) None of the above

Answer: (b)

At the end of the accounting year all the nominal accounts of the ledger book are

• (a) Balanced but not transferred to profit and loss account • (b) Not balanced and also the balance is not transferred to

the profit and loss account • (c) Balanced and the balance is transferred to the balance

sheet • (d) Not balanced and their balance is transferred to the profit

and loss account

Answer: (d)

Ledger Book is known as:

• (a) Secondary book of accounts • (b) book of original entry • (c ) Subsidiary book of accounts • (d) None

Answer: (a)

The Process of transferring the transactions relating to changes in a particular item at one place in the form of an account is called

• (a) Balancing • (b) Casting • (c) Journalizing • (d) Posting

Answer (d)

Cash Sales Rs.50,000

Cash Collected from Debtors Rs.1,30,000

Bad Debts during year Rs.5,000

Debtors at end Rs.10,000

Total Sales will be as this is the first year of the business:-

•(a) Rs.1,95,000 •(b) Rs.1,70,000 •(c) Rs.1,80,000 •(d) Rs.1,78,000

Answer: (a)

if total of debit side exceed the credit side we have a

•Debit balance •Credit balance •Income •Loss

Answer: Debit balance

Cash a/c will show

•(a) Debit or credit balance •(b) Debit balance •(c) Credit balance •(d) None

Answer: (b) Debit balance

Generally the balance of capital a/c is

•Credit balance •Debit balance •Zero balance •None

Answer: Credit balance

Nominal credit balance indicate

•Income •Expense •Asset •liability

Answer: Income

In a ledger a/c of creditor, the closing balance will appear on • (a) Dr side • (b) Cr side • (c) No balance • (d) None of these

Answer: (a) Dr side

Ledger is •(a) Book of prime entry •(b) Principal book •(c) Subsidiary book •(d) Journal proper

Answer: (b) Principal book

Which of the following a/c will always have a debit balance • (a) Cash • (b) Bank • (c) Discount • (d) None

Answer: (a) Cash

Normally the following accounts are balanced

• (a) Real a/c and nominal a/c • (b) Personal a/c and real a/c • (c) Only nominal a/c • (d) All accounts

Answer: (b) Personal and Real a/c