Match each accounting event or transaction on the left with its corresponding recording tr… — JAMB UTME

Match each accounting event or transaction on the left with its corresponding recording treatment or book of prime entry on the right.

Writing off an irrecoverable debt owed by a customer at the end of the financial year.Debit Bad Debts Account and Credit Debtors Account in the General Journal.
Correcting an error where the purchase of office equipment on credit was incorrectly debited to Purchases Account.Debit Office Equipment Account and Credit Purchases Account in the General Journal.
Opening entry calculation for a business commencing with Motor Van $\text{₦}1,200,000$ , Trade Debtors $\text{₦}450,000$ , Cash $\text{₦}150,000$ , and Trade Creditors $\text{₦}500,000$ .Credit Capital Account with $\text{₦}1,300,000$ in the General Journal.
Purchase of merchandise inventory on credit from a trade vendor for resale.Recorded directly in the Purchases Journal.

Cevap

Writing off irrecoverable debt matches with 'Debit Bad Debts Account and Credit Debtors Account in the General Journal'. Correcting credit purchase of office equipment debited to Purchases Account matches with 'Debit Office Equipment Account and Credit Purchases Account in the General Journal'. Opening entry with Motor Van ₦1,200,000, Debtors ₦450,000, Cash ₦150,000, and Creditors ₦500,000 matches with 'Credit Capital Account with ₦1,300,000 in the General Journal'. Purchase of merchandise inventory on credit for resale matches with 'Recorded directly in the Purchases Journal'.

The General Journal (Journal Proper) is reserved for non-routine transactions including opening entries, correction of errors, year-end adjustments (such as writing off bad debts), and credit purchases/sales of non-current assets. Regular credit purchases of inventory are recorded in the Purchases Journal. In the opening entry calculation, total assets (Motor Van ₦1,200,000 + Debtors ₦450,000 + Cash ₦150,000 = ₦1,800,000) less liabilities (Creditors ₦500,000) equals Opening Capital of ₦1,300,000.

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Analyze the bad debt write-off transaction

Writing off an irrecoverable debt is a non-routine adjustment. It requires debiting Bad Debts Account and crediting Debtors Account in the General Journal.

Adjusting entries and writing off bad debts are principal functions of the General Journal.

Analyze the error correction transaction

The purchase of office equipment is a fixed asset (capital expenditure). Debiting Purchases Account was an error of principle. To rectify, debit Office Equipment Account and credit Purchases Account in the General Journal.

Correction of errors is performed via journal entries in the General Journal.

Calculate Opening Capital for the business commencement item

Sum of Assets = Motor Van (₦1,200,000) + Debtors (₦450,000) + Cash (₦150,000) = ₦1,800,000. Liabilities = Creditors (₦500,000). Capital = ₦1,800,000 - ₦500,000 = ₦1,300,000. The entry credits Capital Account with ₦1,300,000.

The opening journal entry uses the fundamental accounting equation: Assets - Liabilities = Capital.

Identify the proper book of original entry for credit purchases of inventory

Credit purchases of inventory for resale belong in the Purchases Journal, not the General Journal.

The General Journal only records special transactions, such as credit purchases of non-current (fixed) assets, not inventory.

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Uses of the General Journal (Journal Proper) and Opening Entry Calculations

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