Compound Journal Entry | Examples | Journal

Compound journal entry

In the transaction, Where more than two accounts of Debit, Credit or both are involved and recorded this transaction in day book by single journal entry, that journal entry is known as the Compound Journal Entry. It is also known as a combine journal entry.

Compound Journal Entry may be recorded as below:

  1. By debited two or more accounts and credited only a single account.
  2. By debited a single account and credited two or more accounts.

Treatment of journal shown step by step in the earlier post. (Click here on the following link to know about it)

The Golden rules of Accounting 

The Modern Approach to Accounting

1. By debited two or more accounts and credited only a single account:

Example 1:

On Date 01/08/2017 Sold goods to Mr Rajan worth Rs. 40,000/- and He paid Rs. 5,000/- in cash and 35,000/- By cheque.

In this above transaction three accounts are involved shown as below:

  1. Cash A/c –  Rs 5,000/- Cash received for it.
  2. Bank A/c – Balance payment made with the cheque.
  3. Sale A/c – Goods sold.
Compound entry Example 2 1 2 - Compound Journal Entry | Examples | Journal
Compound Journal Entry Example

2. By debited a single account and credited two or more accounts.

Example 2:

On Date 01/08/2017 Purchase goods from Mr Rohan worth Rs. 30,000/- and paid him Rs. 5,000/- in cash and 25,000/- By cheque.

In this above transaction three accounts are involved shown as below:

  1. Purchase A/c – Goods purchased.
  2. Cash A/c –  Rs 5,000/- Cash paid for it.
  3. Bank A/c – Balance payment made with the cheque.
Compound entry Example - Compound Journal Entry | Examples | Journal
Compound Journal Entry Example
 

Question for Practice:                                                                                            and in the comment box, I will check the Question and tell you the answer.

  1. 01/04/2018 Mr Sohan started business with Building Rs 5,00,000, Cash Rs 50,000 Plant and machine Rs 2,50,000 and furniture Rs 1,50,000.
  2. 02/04/2018 Purchase goods from Miss Radhika for Rs 75,000 and From M/s Ramu & Sons Pvt. Ltd. For Rs. 90,000.
  3. 05/04/2018 Payment made to M/s Ramu & Sons Pvt. Ltd. and get discount of Rs 1,800/-.
  4. 05/04/2018 Sold goods to Mr Rohan worth Rs. 25,000 and to Mrs Rajni worth Rs. 15,000/-.
  5. 06/04/2018 Payment made to Miss Radhika for Rs 15,000/- by cash and 58,000/- by cheque and received discounts of Rs. 2,000/-
  6. 10/04/2018 Salary worth Rs 50,000/- and Wages worth Rs. 30,000/- paid for the month.
  7. 12/04/2018 Purchase goods worth Rs 25,000 and paid freight on it for Rs 500/-.
  8. 15/04/2018 Payment received from Mrs Rajni for Rs. 14900 after deducting Rs 100 Discount.

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T.S. Grewals Double Entry Book Keeping - Compound Journal Entry | Examples | Journal

T.S. Grewal’s Double Entry Book Keeping

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