Acknowledgement

I would like to express my gratitude to my teacher Pr. MAYADHAR BARIK Who

gave me the amazing opportunity to do this wonderful ACCOUNTING PROJECT
on the topic JOUNAL, LEDGER, TRIAL BALANCE AND FINAL ACCOUNTS . I
would also like to thank my parents and friends who helped me a lot in finalizing
this project within the limited time frame.

I am also indebted to all the faculty members of the department

whose inspiration had encouraged me to complete my study

SIGNATURE OF THE STUDENT

 CERTIFICATE

THIS IS TO CERTIFY THAT LIPSA ROY CLASS XII COMMERCE HAS SUCCESSFULLY COMPLETED THE
PROJECT WORK ON ACCOUNTANCY AS PER THE GUIDELINES OF C.H.S.E (O).

THE ORIGINAL RESEARCH WORK WAS CARRIED BY HER UNDER

MY SUPERVISION IN THE ACADEMIC YEAR 2019-20.ON THE BASIS OF DECLARATION MADE
BY HER. RECOMMENDED THIS PROJECT REPORT FOR THE EVALUATION.

PLACE: BHUBANESWAR
DATE:

SIGNATURE OF THE GUIDE

 ABSTRACT

A journal is a chronological (arranged in order of time) record of business

transactions. A journal entry is the recording of a business transaction in the journal. A journal
entry shows all the effects of a business transaction as expressed in debit(s) and credit(s) and
may include an explanation of the transaction..

A ledger (general ledger) is the complete collection of all the accounts and
transactions of a company. The ledger may be in loose-leaf form, in a bound volume, or in
computer memory. The chart of accounts is a listing of the titles and numbers of all the
accounts in the ledger. The chart of accounts can be compared to a table of contents.

A trial balance is a listing of all accounts (in this order: asset, liability, equity, revenue,
expense) with the ending account balance. It is called a trial balance because the information on
the form must balance.
 INTRODUCTION

The word ‘journal’ has been derived from the French word ‘jour’ which means day.
Therefore, journal means daily records. It is called a book of original entry because every
business transaction is first recorded in this book. In case of small business journal is the only
book of original entry.

Ledger is principle book or primary book of accounts. It is the most important accounting
system. It contains all the accounts (assets, liabilities, capital, revenue and expenses) to which
the transactions recorded in the books of original entry are transferred and posted.

The main objective of accounting is to ascertain profit and loss of the business and the
financial position of the business. In order to check the arithmetic accuracy of books of account
a schedule of accounting balances is prepared which is known as trial balance.

The final accounts prepares on the basis of balances of various accounts in the ledger.
The final accounts prepares at the end of the accounting period to ascertained the profit & loss
and find out the financial position of the business.
 MEANING OF JOURNAL ENTRIES

Journal entries are an important part of accountancy. A journal entry, into accounting, is
the logging of a transaction in accounting journal items. The journal entry can consist of several
recordings, each of which is either a debit or a credit. The total of the debits must equal the total
of the credits or the journal entry is said to be "unbalanced". Journal entries can record unique
items or recurring items such as depreciation or bond amortization. In accounting software,
journal entries are usually entered using a separate module from accounts payable, which
typically has its own sub ledger that indirectly affects the general ledger. As a result, journal
entries directly change the account balances on the general ledger.

MEANING OF LEDGER

A ledger[1] is the principal book or computer file for recording and totaling economic
transactions measured in terms of a monetary unit of account by account type, with debits and
credits in separate columns and a beginning monetary balance and ending monetary balance for
each account.A ledger is a written or computerized record of all the transactions a business has
completed. These transactions are recorded in the ledger in different accounts. This list of
accounts is most often called the chart of accounts. Large companies tend to have many accounts
in their chart of accounts while smaller companies might only have a few accounts listed.

The general ledger or ledger is a record of all the accounts that the company uses. In all
modern accounting systems, the general ledger is computerized. A general ledger divides
accounts into three account types: assets, liabilities, and equity accounts. Most companies have
many of the same general accounts like cash, accounts payable, and retained earnings, but some
companies have specialized accounts specific for their operations.

MEANING OF TRIAL BALANCE:

A trial balance is a list of all the general ledger accounts (both revenue and capital)
contained in the ledger of a business. This list will contain the name of each nominal ledger
account and the value of that nominal ledger balance. Each nominal ledger account will hold
either a debit balance or a credit balance. The debit balance values will be listed in
the debit column of the trial balance and the credit value balance will be listed in the credit
 column. The trading profit and loss statement and balance sheet and other financial reports
can then be produced using the ledger accounts listed on the same balance.

A trial balance is a list of all general ledger accounts and their balances at a point in time.
In essence, its summary of all of the t-account balances in the ledger.

MEANING OF FINAL ACCOUNTS:

Final accounts give an idea about the profitability and financial position of a business to
its management, owners, and other interested parties. All business transactions are first recorded
in a journal. They are then transferred to a ledger and balanced. These final tallies are prepared for
a specific period. The preparation of a final accounting is the last stage of the accounting cycle. It
determines the financial position of the business. Under this it is compulsory to make trading
account, the profit and loss account and balance sheet.

The term "final accounts" includes the trading account, the profit and loss account, and
the balance sheet.

The financial statements of an organization made up at the end of an accounting period,

usually the fiscal year.
For a manufacturer, the final accounts consist of (1) manufacturing account, (2) trading
account, (3) profit and loss account, and (4) balance sheet. A commercial company's final
accounts will include all of the above except the manufacturing account. Together, these accounts
show the gross profit, net income, and distribution of net income figures of the company.
 METHODOLOGY:

The tools used in the project are:

1) Journal

2) Ledger

3) Trading Account

4) Profit & Loss Account

5) Balance Sheets

(i) Scope of study:

The study concerned with the business account of trading organization. The
journal, ledger, trial balance, and final accounts are prepared. This helps to know the
financial results and financial position of the business.
(ii) Data Sources:

The study is based on only secondary data. These data’s are basically collected
from internet and from various books related to subject matter.

(iii) Time Period:

It took 15 days to undertaking the entire data.
 CASE STUDY:
PROBLEM: Record the following entries in the books of trader. Prepare a trial balance and
prepare final accounts at the end of the period.
1. Ajit started business by investing cash rs.5, 00,000. He bought goods worth rs. 40, 000 and
furniture rs. 50,000.
2. Purchased building for rs. 1,00,000.
3. Purchased goods for cash rs. 30,000.
4. Purchased goods on credit rs.2500.
5. Paid cartage rs. 200.
6. Sold goods for cash rs. 25,500.
7. Sold goods for cash to avatar rs. 2,400.
8. Sold goods to Mahendra rs. 4,650.
9. Paid freight rs. 120.
10. Deposited cash into bank rs. 8000.
11. Paid salary rs.4, 600.
12. Withdrawn from bank rs. 5000 for office use.
13. Withdrawn from bank rs.3, 000 for personal use.
14. Charged interest on capital rs. 12,500.
15. Mahendra became insolvent, only rs. 3000 could be realized from him.
NOTE: Stock at the end of period is rs. 2,500.
 CONCLUSION

We conclude that Journal is an entry made to your books of accounts supported by

documentary evidence. Ledgers are accounts prepared for bringing all entries related to individual
particular accounts under the same account. This is where the need of journal entries is the most,
so that they can be posted to ledger accounts. Trial Balance is a summary statement where the
balance of all ledger accounts is listed according to their nature (debit or credit). Mathematical
accuracy is the primary objective of trial balance. It is then used for preparing the statement of
profit and loss and balance sheet.

At this stage of the preparation of the accounting information these are just intermediary
steps and schedules which all come together so all balances can be seen. The trial balance is then
converted to two statements one is the profit and loss account and the balance sheet

Final account is an essential practice for every enterprise to know the actual performance
of the organization. All mature organization should necessary prepare final accounts of the
organization for the effectiveness of business organization.
 REFERENCES

1. WWW.GOOGLE.CO.IN.

2. WWW.WIKIPEDIA.COM.

3. BOOK- DOUBLE ENTRY BOOK-KEEPING BY C.MOHAN JUNEJA, J.S.ARORA

AND P.C.SAHOO (KALYANI PUBLISHER).

4. BOOK- ACCOUNTANCY BYJYOTI PRAKASH RATH (KALYANI PUBLISHER).

 INDEX

S.NO. TOPICS PAGE NO.

(1) INTRODUCTION

(2) OBJECTIVE

(3) THEROTICAL DECRIPTION

(4) METHODOLOGY

(5) CASE STUDY

(6) ANALYSIS & INTERPRETATION

(7) CONCLUSION

(8)
REFERENCE
 JOURNAL ENTRIES
Date Particulars L\F DR. CR.
(i) Cash A\C DR. 5,00,000
To capital A\C - 5,00,000
(being started business with cash)
(i) Purchase A\C DR. 40,000
Furniture A\C DR. 50,000 90,000
To cash A\C -
(being purchased goods and furniture)
(ii) Building A\C DR. 1,00,000
To cash A\C 100,000
(being purchased building for cash)
(iii) Purchase A\C DR. 30,000
To cash A\C
(being purchase goods for cash) 30,000
(iv) Purchase A\C DR. 2,500
To cash A\C 2,500
(being purchase goods on credit)
(v) Cartage A\C DR. 200
To cash A\C 200
(being cartage paid)
(vi) Cash A\C DR. 25,500
To sales A\C 25,500
(being goods sold for cash)
(vii) Cash A\C DR. 2,400
To sales A\C 2,400
(being goods sold to avatar)
(viii) Mahendra’s A\C DR. 4,600
To sales A\C 4,600
(being goods sold to Mahendra on credit)
(ix) Freight A\C DR. 120
To cash A\C 120
(being freight paid )
(x) Bank A\C DR. 8,000
To cash A\C 8,000
(being cash deposited to bank)
(xi) Salary A\C DR. 4,600
To cash A\C 4,600
(being salary paid)
(xii) Cash A\C DR. 5,000
To bank A\C 5000
(being cash withdrawn from bank)
(xiii) Drawings A\C DR. 3,000
To bank A\C 3,000
(being withdraw from bank for personal
use)
(xiv) Interest on capital A\C DR. 12,500
To capital A\C 12,500
(being interest on capital is charged)

(xv) Cash A\C DR. 3,000

Bad debt A\C DR. 1,600
To Mahendra’s A\C 4,600
(being cash received on final settlement)

LEDGER ACOUNTS
Cash Account:
Date Particulars Amount Date Particulars Amount
(i) To Capital A\C 5,00,000 (i) By Purchase A\C 40,000
(vi) To Sales A\C 25,500 (i) By Purchase A\C 50,000
(vii) To Sales A\C 2,400 (ii) By Building A\C 1,00,000
(xii) To Bank A\C 5,000 (iii) By Purchase A\C 30,000
(xv) To Mahendra’s A\C 3,000 (v) By Cartage A\C 200
(ix) By Freight A\C 120
(x) By Bank A\C 8000
(xi) By Salary A\C 4,600
- By Balance c\d 30,298

5,35,900 5,35,900

Capital Account:
Date Particulars Amount Date Particulars Amount
- To Balance c\d 5,12,500 (i) By Cash A\C 5,00,000
(xiv) By interest on capital A\C 12,500

5,12,500 5,12,500
 Purchase Account:
Date Particulars Amount Date Particulars Amount
(i) To Cash A\C 40,000
(iii) To Cash A\C 30,000
(iv) To Sundry Creditors A\C 2,500 - By Balance c\d 72,500

72,500 72,500
Furniture Account:
Date Particulars Amount Date Particulars Amount
(i) To Cash A\C 50,000 - By Balance c\d 50,000

50,000 50,000
Building Account:
Date Particulars Amount Date Particulars Amount
(ii) To Cash A\C 1,00,000 - By Balance c\d 1,00,000

1,00,000 1,00,000
Sundry Creditors Account;
Date Particulars Amount Date Particulars Amount
- To Balance c\d 2,500 (iv) By purchase A\C 2,500

2,500 2,500
Cartage Account:
Date Particulars Amount Date Particulars Amount
(v) To cash A\C 200 - By Balance c\d 200

200 200
Sales Account:
Date Particulars Amount Date Particulars Amount
(vi) By Cash A\C 25,500
(vii) By Cash A\C 2,400
- By Balance c\d 32,550 (viii) By Mahendra’s A\C 4,650
32,550 32,550
Mahendra’ Account:
Date Particulars Amount Date Particulars Amount
(viii) To Sales A\C 4,650 (xv) By Cash A\C 3,000
(xv) By Bad debt A\C 1,650
4,650 4,650

Freight Account:
Date Particulars Amount Date Particulars Amount
(ix) To cash A\C 120 - By Balance c\d 120

120 120
Bank Account:
Date Particulars Amount Date Particulars Amount
(x) To Cash A\C 8,000 (xii) By Cash A\C 5,000
(xiii) By Drawings A\C 3,000

8,000 8,000
Salary Account:
Date Particulars Amount Date Particulars Amount
(xi) To Cash A\C 4,600 - By Balance c\d 4,600
4,600 4,600
Drawings Account;
Date Particulars Amount Date Particulars Amount
(xiii) To Bank A\C 3,000 - By Balance c\d 3,000
3,000 3,000
Interest on Capital Account:
Date Particulars Amount Date Particulars Amount
(xiv) To Capital A\C 12,500 - By Balance c\d 12,500

12,500 12,500
Bad Debt Account:
Date Particulars Amount Date Particulars Amount
(xv) To Mahendra’s A\C 1,650 - By balance c\d 1,650

1,650 1,650
 TRIAL BALANCE
DR. CR.
Accounts
Balance Balance
Cash AC 3,02,980 -
Capital A\C - 5,12,500
Purchase A\C 72,500 -
Furniture A\C 50,000 -
Building A\C 1,00,000 -
Sundry Creditors A\C - 2,500
Cartage A\C 200 -
Sales A\C - 32,550
Freight A\C 120 -
Salary A\c 4,600 -
Drawings A\C 3,000 -
Interest on capital A\C 12,500 -
Bad debt A\C 1,650 -

5,47,550 5,47,550
 FINAL ACCOUNTS:
Trading and Profit & Loss Accounts
Particulars Amount Particulars Amount
To purchase A\C 72,500 By Sales A\C 32,550
T Cartage A\C 200 By Closing A\C 2,500
To Freight A\C 120 By Gross Profit c\d 37,770

72,820 72820

To Gross Profit b\d 37,770 By Net Loss A\C 56,520

To Salary A\C 4,600
To interest on capital A\C 12,500
To Bad debt A\C 1,650

56,520 56,520

Balance Sheet

Liabilities Amount Assets Amount

Capital 5,12,500 Building 1,00,000
Less: Net loss (-)56,520 Furniture 50,000
4,55,980 Cash 3,02,980
Less: Drawings (-) 3,000 Closing Stock 2,500
4,52,980
2,500
Sundry creditors

4,55,480
4,55,480
 PIE CHART

Expenses
Nil
Loss

BAR DIAGRAM
56,520 Expenses

15,000 Income (Nil)

15,000

Loss

56,520
 ANALYSIS & INTERPRETATION
The study analysis reveals that the traders business has making losses. The trader invested capital of
₹5,00,000 and goods worth ₹40,000 and furniture worth ₹50,000. And the end of the year the capital of
the business stood at ₹4,52,980 and stock is ₹2,500 and in furniture their will no change. And the
business have a loss of ₹56,520
 OBJECTIVES
1) The objective of this project is to study about Financial Statement of a Company.

2) This Project shows You about The gross profit , Net profit, total Expenses, Financial Position Of
the Company

3) To understand The Financial Health Of the business.

4) To Imporve the management of the business.