Journal ICSE Class 9 Commercial Studies: Classification of Accounts and Journal Entries

What Journal is about

Weightage: CISCE publishes no chapter weightage and no question-paper layout for ICSE Class 9 Commercial Studies. Class IX is examined by your school: one 80-mark paper of 2 hours plus 20 marks of internal assessment. Journal is topic 4. Introduction to Accounting and Bookkeeping (d) of the 2028 syllabus.Source: CISCE ICSE 2028 Commercial Studies syllabus, Class IX

Key concepts

Meaning and format of the journal

The word journal comes from the French 'jour', meaning day. The journal is the book in which business transactions are first recorded in chronological (date) order, showing the accounts to be debited and credited and the amounts, with a short explanation. It is called the book of original entry or book of prime entry. Recording a transaction in the journal is called journalising, and each record is a journal entry.

Format (five columns):

Date	Particulars	L.F.	Debit (₹)	Credit (₹)
2026 Apr 1	Cash A/c ... Dr		2,00,000
	To Capital A/c			2,00,000
	(Being business started with cash)

Rules of writing: the debited account is written first, close to the Particulars margin, followed by 'Dr'; the credited account is written on the next line, a little to the right, beginning with 'To'; the narration (the 'Being…' line) is written below in brackets; L.F. (ledger folio) shows the page of the ledger to which the entry is posted, filled in at the time of posting. The year and month are written at the top of the date column.

Advantages: chronological record of all transactions; both aspects of each transaction in one place; narration explains each entry; it reduces errors and makes posting to the ledger easy.

Worked example

(2 marks) What is a journal? Why is it called the book of original entry?

Try it first, then show the solutionSolution

1. The journal is the book in which transactions are first recorded in date order, showing the debit and credit accounts, amounts and narration - 1 mark.
2. It is called the book of original entry because every transaction is recorded in it first, before being posted to the ledger - 1 mark.

Answer: The journal is the book where transactions are first recorded day by day, with debit and credit accounts, amounts and a narration. It is the book of original entry because transactions enter the accounting records here first.

Classification of accounts (traditional approach)

1. Personal accounts: accounts of persons with whom the business deals.
(a) Natural personal accounts: individuals, e.g. Mohan's A/c, Rita's A/c.
(b) Artificial personal accounts: bodies created by law, e.g. State Bank of India A/c, Kavya Traders Ltd A/c, a club or a college.
(c) Representative personal accounts: accounts representing a person or group, e.g. Outstanding Salaries A/c (payable to employees), Prepaid Insurance A/c (receivable from the insurer).
Capital A/c and Drawings A/c are personal accounts of the owner.

2. Real accounts: accounts of things or property owned by the business, tangible (cash, furniture, machinery, building, stock) or intangible (goodwill, patents, trademarks). Purchases and sales accounts record goods and are usually treated alongside real accounts in this approach. (Bank A/c is a personal account because the bank is an artificial person.)

3. Nominal accounts: accounts of expenses, losses, incomes and gains, e.g. Rent A/c, Salaries A/c, Wages A/c, Commission Received A/c, Interest Received A/c.

Worked example

(2 marks) Classify: (a) Furniture A/c; (b) Rent A/c; (c) Bank A/c; (d) Outstanding Wages A/c.

Try it first, then show the solutionSolution

1. (a) Furniture: real account. (b) Rent: nominal account - 1 mark.
2. (c) Bank: personal (artificial). (d) Outstanding Wages: personal (representative) - 1 mark.

Answer: (a) Real; (b) nominal; (c) personal, artificial; (d) personal, representative.

Rules of debit and credit

Traditional (golden) rules:

Type of account	Debit	Credit
Personal	The receiver	The giver
Real	What comes in	What goes out
Nominal	All expenses and losses	All incomes and gains

Modern (accounting equation) rules:

Type of account	Increase	Decrease
Assets	Debit	Credit
Liabilities	Credit	Debit
Capital	Credit	Debit
Revenues and gains	Credit	Debit
Expenses and losses	Debit	Credit
Drawings (reduces capital)	Debit	Credit

Both approaches always give the same entry. Example: paid rent ₹6,000 in cash. Traditional: Rent (nominal, expense) Dr; Cash (real, goes out) Cr. Modern: Rent (expense increases) Dr; Cash (asset decreases) Cr.

Worked example

(2 marks) Using the golden rules, explain the entry for 'Goods sold on credit to Rita ₹18,000'.

Try it first, then show the solutionSolution

1. Rita's A/c is personal; she receives the goods, so debit the receiver: Rita A/c Dr ₹18,000 - 1 mark.
2. Sales A/c records goods going out; credit what goes out: To Sales A/c ₹18,000 - 1 mark.

Answer: Rita A/c Dr ₹18,000, To Sales A/c ₹18,000 (Being goods sold on credit to Rita). Rita is the receiver (debit); goods go out (credit Sales).

Analysing a transaction: the four-step method

Step 1: Identify the two accounts affected.
Step 2: Classify each account (personal, real, nominal; or asset, liability, capital, revenue, expense).
Step 3: Apply the rule to decide which is debited and which credited.
Step 4: Write the entry with date, 'Dr', 'To', amounts and narration.

Useful decisions:

• Cash transaction or credit transaction? For a credit purchase, the supplier's personal account is credited (not cash); for a credit sale, the customer's account is debited.
• Goods dealt in → Purchases A/c or Sales A/c; assets for use → the asset's own account (Furniture A/c, Machinery A/c).
• Owner takes cash or goods → Drawings A/c Dr (for goods, credit Purchases A/c).
• Payment by cheque → Bank A/c instead of Cash A/c.
• Expenses paid → the expense account Dr; incomes received → the income account Cr.

Worked example

(2 marks) Journalise: (a) Bought furniture by cheque ₹15,000; (b) Owner took goods worth ₹1,500 for personal use.

Try it first, then show the solutionSolution

1. (a) Furniture A/c Dr 15,000; To Bank A/c 15,000 (Being furniture purchased by cheque) - 1 mark.
2. (b) Drawings A/c Dr 1,500; To Purchases A/c 1,500 (Being goods withdrawn for personal use) - 1 mark.

Answer: (a) Furniture A/c Dr ₹15,000, To Bank A/c ₹15,000. (b) Drawings A/c Dr ₹1,500, To Purchases A/c ₹1,500.

Common simple transactions and their entries

Transaction	Entry
Started business with cash	Cash A/c Dr; To Capital A/c
Deposited cash into bank	Bank A/c Dr; To Cash A/c
Withdrew cash from bank for office use	Cash A/c Dr; To Bank A/c
Purchased goods for cash	Purchases A/c Dr; To Cash A/c
Purchased goods on credit from X	Purchases A/c Dr; To X A/c
Sold goods for cash	Cash A/c Dr; To Sales A/c
Sold goods on credit to Y	Y A/c Dr; To Sales A/c
Bought an asset for cash	Asset A/c Dr; To Cash A/c
Received cash from debtor Y	Cash A/c Dr; To Y A/c
Paid creditor X by cheque	X A/c Dr; To Bank A/c
Paid an expense (rent, wages, salaries)	Expense A/c Dr; To Cash A/c
Received an income (commission, interest)	Cash A/c Dr; To Income A/c
Withdrew cash for personal use	Drawings A/c Dr; To Cash A/c
Took goods for personal use	Drawings A/c Dr; To Purchases A/c

Not in the Class IX syllabus: compound entries (more than one debit or credit), cash discount, bad debts, opening and closing entries.

Worked example

(2 marks) Journalise: (a) Received commission ₹2,000 in cash; (b) Paid Mohan ₹25,000 by cheque.

Try it first, then show the solutionSolution

1. (a) Cash A/c Dr 2,000; To Commission Received A/c 2,000 (Being commission received in cash) - 1 mark.
2. (b) Mohan A/c Dr 25,000; To Bank A/c 25,000 (Being amount paid to Mohan by cheque) - 1 mark.

Answer: (a) Cash A/c Dr ₹2,000, To Commission Received A/c ₹2,000. (b) Mohan A/c Dr ₹25,000, To Bank A/c ₹25,000.

Journal in real life

Each concept, met in an everyday situation. Read the situation, answer the question in your own words, then compare with the model answer. The one-line hook is what to remember.

Topics in this chapter

• Journal Format, Classification of Accounts and the Rules of Debit and Credit
• Journalising Simple Transactions with Numerical Practice

Journal: key facts

Personal

Debit the receiver; credit the giver

Natural, artificial (bank, company), representative.

Real

Debit what comes in; credit what goes out

Cash, furniture, machinery, goods.

Nominal

Debit all expenses and losses; credit all incomes and gains

Rent, wages, commission.

Modern rules

Assets, expenses, drawings: increase Dr. Liabilities, capital, revenue: increase Cr.

Decreases are the opposite.

Journal check

Total of debit column = Total of credit column

Every simple entry has equal debit and credit.

Four steps

1. 1.Identify accounts
2. 2.classify
3. 3.apply rule
4. 4.write with narration

Journal: diagrams to practise

Practise each one on paper: draw it from the checklist, then tick off every label.

How the school exam asks Journal

The question patterns to expect, and the method that works for each.

Tricks to remember Journal

Short memory aids. Say each one aloud once, then use it on a question the same day.

• Receiver-Giver, In-Out, Expense-Income

  Personal: receiver Dr, giver Cr. Real: in Dr, out Cr. Nominal: expense Dr, income Cr.

  Use it when: Golden rules.

• DEAD CLIC

  Debit: Expenses, Assets, Drawings. Credit: Liabilities, Income, Capital (for increases).

  Use it when: Modern rules.

• Bank is a person

  Bank and Capital are personal accounts, not real.

  Use it when: Classification traps.

Journal: exam-level solved questions

Ordered from exam level to HOTS. Cover the solution, write your own, then compare step by step.

Case-study practice (Section B style)

Read the situation, then answer every part. In a school exam set on the board pattern this is a 9-mark question split into 2 + 2 + 5 marks.

Where the marks are

How a typical answer is split into step marks. Show every step: a right final answer alone rarely earns full marks.

Where students lose marks in Journal

The slips examiners see most often, and what to write instead.

• ✗Mistake: Crediting Cash for a credit purchase

  No cash leaves on a credit purchase; the supplier becomes a creditor.

  Wrong working

  'Purchases A/c Dr 25,000; To Cash A/c 25,000' (goods bought on credit from Mohan)

  Right working

  'Purchases A/c Dr 25,000; To Mohan A/c 25,000'

  ✓Do this: Ask: was cash paid now? If not, credit the person.

  Usually costs: 1 mark per entry.

• ✗Mistake: Using Purchases A/c for assets bought for use

  Purchases means goods for resale only.

  ✓Do this: Furniture A/c, Computer A/c, Machinery A/c.

  Usually costs: 1 mark.

• ✗Mistake: Treating the owner's personal payments as expenses

  Business entity concept: they are drawings.

  ✓Do this: Drawings A/c Dr.

  Usually costs: 1 mark.

• ✗Mistake: Classifying Bank A/c as real

  A bank is an artificial person.

  ✓Do this: Bank: personal (artificial).

  Usually costs: ½ to 1 mark.

• ✗Mistake: Missing narrations and 'Dr'/'To'

  Format is part of the marking.

  ✓Do this: Write 'Dr' after the debit account, 'To' before the credit account, and a narration.

  Usually costs: Up to 1 mark in a long question.

Practice questions on Journal

Write each answer on paper first. Open the hint only if you are stuck, and the answer only when you have finished.

1. Q1 · 1 mark · MCQExam level

   Goods sold on credit to Anil are recorded by debiting:
   (a) Cash A/c
   (b) Sales A/c
   (c) Anil's A/c
   (d) Purchases A/c

   Hint

   Receiver.

   Answer

   (c) Anil's A/c.

2. Q2 · 1 mark · MCQExam level

   Which of the following is a nominal account?
   (a) Machinery A/c
   (b) Wages A/c
   (c) Bank A/c
   (d) Drawings A/c

   Hint

   Expense.

   Answer

   (b) Wages A/c.

3. Q3 · 2 marks · Very short answerExam level

   What is a narration? Why is it written?

   Hint

   Being…

   Answer

   A narration is a brief explanation of a transaction written below each journal entry, beginning with 'Being…'. It tells the reader what the entry is for and helps in checking and posting.

4. Q4 · 2 marks · Very short answerExam level

   State the golden rules for personal and real accounts with one example each.

   Hint

   Receiver-giver; in-out.

   Answer

   Personal: debit the receiver, credit the giver (e.g. cash paid to Mohan: Mohan A/c Dr). Real: debit what comes in, credit what goes out (e.g. furniture bought for cash: Furniture A/c Dr, Cash A/c Cr).

5. Q5 · 2 marks · Short answerHarder exam level

   Journalise: (a) Withdrew ₹5,000 from bank for office use; (b) Paid wages ₹2,500.

   Hint

   Contra: bank to cash.

   Answer

   (a) Cash A/c Dr ₹5,000, To Bank A/c ₹5,000 (Being cash withdrawn from bank for office use). (b) Wages A/c Dr ₹2,500, To Cash A/c ₹2,500 (Being wages paid).

6. Q6 · 2 marks · Very short answerHarder exam level

   Why are Bank A/c and Capital A/c classified as personal accounts?

   Hint

   Persons in law.

   Answer

   A bank is an artificial person created by law, so its account is personal (artificial). Capital A/c is the owner's account, representing the amount the business owes to the owner, a person.

7. Q7 · 2 marks · Short answerHarder exam level

   Journalise: (a) Sold goods to Kiran for cash ₹6,500; (b) Bought goods from Kiran on credit ₹8,000.

   Hint

   Cash sale versus credit purchase.

   Answer

   (a) Cash A/c Dr ₹6,500, To Sales A/c ₹6,500 (a cash sale does not use Kiran's account). (b) Purchases A/c Dr ₹8,000, To Kiran A/c ₹8,000 (Being goods bought on credit).

8. Q8 · 2 marks · Short answerHOTS / competency

   In Neha's case study, find the journal total and show working.

   Hint

   Add all seven amounts.

   Answer

   80,000 + 30,000 + 24,000 + 7,000 + 9,000 + 1,200 + 2,000 = ₹1,53,200 on each side.

9. Q9 · 5 marks · Long answerHOTS / competency

   'Every transaction recorded in the journal has two equal aspects.' Explain with three different entries using both golden and modern rules.

   Hint

   Dual aspect.

   Answer

   (1) Started business with cash ₹50,000: Cash (real, comes in / asset up) Dr; Capital (personal, giver / capital up) Cr. (2) Bought goods on credit from Sara ₹12,000: Purchases (goods come in / expense-type increase) Dr; Sara (giver / liability up) Cr. (3) Received interest ₹800: Cash (comes in / asset up) Dr; Interest Received (income / revenue up) Cr. In each, the debit equals the credit, so the journal's two columns always total the same.

Test your recall

Answer in your head or on paper first, then open the card. Pulling an answer out of memory makes it stick far better than re-reading.

1. 1.What does 'jour' mean?Show answer

   Day.

2. 2.Golden rule for nominal accounts?Show answer

   Debit all expenses and losses; credit all incomes and gains.

3. 3.Entry for goods taken by the owner?Show answer

   Drawings A/c Dr; To Purchases A/c.

4. 4.What does L.F. stand for?Show answer

   Ledger folio.

5. 5.Which journal entries are not in the Class IX syllabus?Show answer

   Compound entries (including cash discount and bad debts), and opening and closing entries.

Quick revision checklist

The night before the exam: can you do each of these without looking?

• ☐Journal: book of original entry, date order, debit, credit, narration.
• ☐Personal (natural, artificial, representative): receiver Dr, giver Cr.
• ☐Real: comes in Dr, goes out Cr.
• ☐Nominal: expenses and losses Dr, incomes and gains Cr.
• ☐Modern: assets, expenses, drawings increase Dr; liabilities, capital, revenue increase Cr.
• ☐Credit purchase: Purchases Dr, supplier Cr. Credit sale: customer Dr, Sales Cr.
• ☐Drawings: Drawings Dr, Cash or Purchases Cr.
• ☐Totals of debit and credit columns must agree.

Journal: frequently asked questions