Class 11 Accountancy TS Grewal Solutions Chapter 5 - Journal
Bank reconciliation is an important concept in business which is required to tally the internal business financial records with the record provided by the bank. This process can detect any discrepancies due to bank error or timing difference.TS Grewal Class 11 Solutions Chapter 5 journal is geared towards providing a thorough knowledge of this topic to the students. The procedure of preparing bank statements and various kinds of errors that can happen in this process are explained in a detailed manner which will make it simpler for students to grasp the theoretical and practical application of this concept.
What are Journals?
Journals where a firm originally records all of its commercial transactions are known as books of original entry. The data from the original entry books are summed up and entered in the general ledger, which is subsequently utilised to generate the trial balance and financial statements. A diary is a book of original entries that keeps track of transactions as they happen. Each entry in the journal must have a source document. Maintaining a journal ensures that all transactions are documented and stored in one location, as well as that the debit and credit for each transaction are appropriately connected. The sections of a journal are as follows.
Types of Original Entry Books
The following are some examples of original entry books.
1.Purchase Journal: The purchase journal is used to track all of the company's credit purchases. It's also known as the invoice book or the purchase day book. It keeps track of all credit purchasing transactions for the company's primary items.
2. Sales Journal: The sales journal is used to keep track of all credit sales made by the company. It's also known as a sales journal or a sales daybook. Only credit sales transactions for commodities that are part of the company's main business operations are documented.
3. Cash Journal: A cash journal, also known as a cash book, is a document that documents all of a company's cash transactions, such as payments and receipts. Payments and receipt entries are entered on the credit side and debit side, respectively, in the cash book, which functions as both a ledger and a diary.
4.General Journal: The general journal is used to keep track of any transactions that aren't documented in the cash book or special journals. Or, to put it another way, the general journal is a diary that records all of the business's non-specialized entries because there is no separate journal for them. Opening entries, closing entries, rectification entries, transfer entries, and entries connected to the acquisition or sale of fixed assets are all instances of such entries.
Benefits of Original Entry Books
The following are some of the benefits of original entry books.
1. Daily transactions are recorded in the original entry books, reducing the possibility of omission.
2. Original entry books capture transaction data as well as a summary, which aids in tracking any errors in recording.
3. Transactions are recorded in chronological sequence, which makes it easier to categorise them into various ledgers.
Disadvantages of Original Entry Books
The following are some of the drawbacks of original entry books.
1. Journals may be fairly large, making data management problematic.
2. Recording transactions in ledgers from journals take a long time.
An Overview of TS Grewal Class 11 Chapter 5 Solutions
Students get the necessary knowledge and definition of bank reconciliation in Class 11 Accountancy Chapter 5 TS Grewal solutions. They can understand why the bank reconciliation process is important and what are the different causes of differences in cash book passbooks. TS Grewal Class 11 ch 5 solutions provide many examples to explain the following key areas of bank reconciliation:
The difference caused by the time gap in reconciliation transactions – Here students will be acquainted with how many different kinds of issues can cause a time gap in recording a transaction. For example, a cheque is issued but not presented to the bank.
Errors committed while recording transactions – In this section of chapter 5 Accounts Class 11 TS Grewal solutions, students will understand that there are two types of mistakes that can happen during a transaction – error by the firm and error by the company. There are concise points discussed in how each type of error can be caused.
The next section of Class 11 Accountancy Chapter 5 TS Grewal Solutions explains how bank reconciliation statements are prepared with tips on how to remember the important points.
XYZ Company needs to close its book, and the following items need to be taken care of in the bank reconciliation statement:
The bank statement displays an ending balance of INR 50,000 on February 28, 2018, while the company’s ledger displays an ending balance of INR 40,000
The bank statement contains a service charge of INR 3000 for operating the account
XYZ had issued a check of INR 5000 which was not cleared by the bank.
There is an interest income of INR 1000 from the bank account.
Class 11 Chapter 5 Journal Preparation Tips
Students must practice as many examples as they can in making bank reconciliation statements.
Takedown notes every day to cover the important points mentioned in the TS Grewal Class 11 Chapter 5 Solutions.
TS Grewal Class 11 book solutions Chapter 5 has been prepared by experienced scholars and teachers, which will help clarify all the doubts related to the bank reconciliation chapter. With important tips and tricks mentioned in its solutions, students will find it easy to grasp the critical areas of this topic.
FAQs on TS Grewal Solution for Class 11 Accountancy Chapter 5
1. According to Class 11 Accountancy TS Grewal Solutions, what are journals?
Books of original entry are journals in which a company first records all of its business transactions. The data from the original entry books are aggregated and placed into the general ledger, which is then used to create the trial balance and financial statements. A diary is a journal of original entries that records transactions as they occur. Each journal post must include a source document. Keeping a diary ensures that all transactions are documented and saved in one place, as well as that the debit and credit for each transaction are properly related.
2. What are the features of journals, according to Class 11 Accountancy TS Grewal Solutions?
A journal has the following characteristics:
Chronology:The journal entries are stored in chronological order, which makes it much easier to examine the transactions.
Double Entry System: Journal entries adhere to a system in which each transaction is recorded on both the debit and credit sides. It exemplifies a dual entrance system. The identical amount is deducted from one account and credited to the other.
A daybook is a diary that records transactions daily for consistency and simplicity of use.
Compound Entry: A single entry may include two or more accounts on the same day, and a journal may have many connected transactions.
Explanation: Each transaction is accompanied by a summary known as the narrative (within brackets). It aids in explaining the transaction's nature and purpose.
3. According to Class 11 Accountancy TS Grewal Solutions, what are the components of journals?
Date of Transaction: It is required to state the date on which the same transaction happens or is being recorded in the books of accounts before writing a transaction in the diary.
Relevant Party & Transaction Details: If the transactions are recorded in the special journal, the transaction should mention the party with whom the credit transaction was placed, i.e., the supplier in the case of a purchase transaction, but if the transaction is booked in the general journal, the transaction should mention the relevant parties details.
The narrative accompanying the transaction offers the transaction data as well as describes the rationale for the transaction or the nature of the transaction in a concise manner.
Provide a Link to the Original Document: It should include a reference to the original document on which the transaction was recorded, such as an invoice number in the instance of purchase.
4. What are the benefits of the journal according to Class 11 Accountancy TS Grewal Solutions?
The Benefits of Original Entry Books
The following are some of the benefits of original entry books.
Daily transactions are documented in books of original entry, reducing the possibility of omission.
The books of original entry include transaction data as well as a summary, which aids in tracking any errors in recording and because the books keep all of the transaction information, as well as a summary of the transaction in the narrations, any inaccuracy in the transaction, maybe immediately spotted during the postage in the individual ledgers account.
Transactions are recorded in chronological sequence, which aids in categorising them into distinct ledgers.
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5. Give an overview of the chapter 5 Journal as discussed in Class 11 Accountancy?
In Class 11 Accountancy Chapter 5 TS Grewal solutions, students gain the essential information and definition of bank reconciliation. They can comprehend the significance of the bank reconciliation procedure and the many sources of disparities in the cash book and passbook.
The difference created by a time gap in reconciling transactions - Students will learn about the many reasons that might generate a time gap in recording a transaction. For example, a cheque that was written but not given to the bank.
Errors made when recording transactions - students will grasp that there are two sorts of faults that might occur during a transaction: errors made by the business and errors made by the company. There are brief explanations of how each sort of mistake might occur.