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a. Only two accounts will be used to record the transaction.
b. One account will be used to record transaction.
c. One account balance will increase and another will decrease.
d. Total amount debited will equals total amount credited.
6. The journal entry to record payment of monthly bill will include:
a. Debit monthly bill and Credit capital
b. Debit capital and Credit cash.
c. Debit monthly bill and Credit cash.
d. Debit monthly bill and Credit creditors.
7. Journal entry to record salaries will include:
a. Debit salaries Credit cash.
b. Debit capital Credit cash.
c. Debit cash Credit salary.
d. Debit salary Credit creditors.

Test Your Understanding

Fill in the blanks:

1. Issued a cheque for ₹ 8,000 to pay rent. The account to be debited is
………………Collected Rs. 35,000 from debtors.
2. The account to be credited is …………
3. 3. Purchased office stationary for Rs. 18,000. The account to be credited
is ………..
4. Purchased new machine for Rs. 1,70,000 and issued cheque for the
same. The account to be debited is …………
5. Issued cheque for Rs. 70,000 to pay off on of the creditors. The account
to be debited is …………
6. Returned damaged office stationary and received Rs. 50,000. The
account to be credited is …………
7. Provided services for Rs. 65,000 on credit. The account to be debited is
………..

Test Your Understanding

Select Right Answer:

1. Voucher is prepared for:
1. Cash received and paid
2. Cash/Credit sales
3. Cash/Credit purchase
4. All of the above
2. Voucher is prepared from:
1. Documentary evidence
2. Journal entry
3. Ledger account
4. All of the above
3. How many sides does an account have?
1. Two
2. Three
3. One