Monik Varma promotes Monik Traders, his proprietary firm, to start a business of trading in Product A on 1 April 20CY. He hires an office at C-12, Sikka Complex, Preet Vihar, Delhi–110092 @₹3,000 p.m. The following are the details of the transactions entered into by the firm during the month of April.

Required 

1. Analyse the above transactions with reference to the rules of recording and dual aspect concept.

2. Record all the transactions in the Journal of Monik Traders.

3. Classify them through ledger accounts.

4. Briefly interpret each ledger account.

5. Summarize the transactions in the form of a trial balance as on 30 April, 20CY.

6. Briefly comment on the significance of trial balance.

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Date April 1 Tr. No. 1 Transactions Received cash from Monik Varma towards his capital. April 1 2 Opened a current account with State Bank of India. April 1 3 Issued cheque for office rent for April. April 1 4 Amount (*) 2,25,000 2,00,000 3,000 Purchased one scooter from Regent Automobiles on credit. All initial costs including insurance borne by the vendor. 32,000 April 1 April 2 April 2 April 5 April 8 6789 Paid cheque towards down payment for scooter. Balance loan, against security of scooter, payable in 12 monthly instalments starting May 1 with interest @ 12% p.a. on reducing balance. Purchased office furniture for cash. 8,000 12,750 Purchased office equipments. Paid cheque. 17,250 Purchased 60 units of product A. Issued cheque. 66,000 Sold 20 units of product A. Received cheque. Deposited in SBI. 27,500