Accounts of a proprietor company

PROBLEM 1: I have 30+ new students registering every month for different courses. For making entry of fees received from them, do I need to create different account for each student or is there any other method ?

It depends on your requirement to retreive data in future. If you want to keep track of fees received by each and every student, then it is better to account the same under individual student name but if you do not need such detailed information, then you can create one account and credit all receipts to that particular account (very similar to sundry debtors account)

Thank You very much for the reply Ms. Poornima !!!

PROBLEM 2: When I started the company in November, 2014, my current account took some time for activating. Before the current account(company account) got operational, all the expenses were made through either my account or my wife's account or by cash withdrawn from either of our accounts. How do I enter those transactions ?  

You have the following options:

1. Amount paid through your account: Treat it as capital or loan to business
2. Amount paid through your wife's account: Treat it as either loan from her/you or capital from you to the business (by borrowing from her)
3. Cash withdrawn from either of the above accounts: Same treatment as above.

So how exactly will the entries work out ?

e.g. 1. I paid Rs. 50000/- from my savings account for computers.

A) Will there be 2 entries ? One for introducing capital to company and other for buying the computers from company. But transaction is actually happened through my account.  

B) Or I'll directly enter the asset purchase from my savings account with 1 entry only ? But in this case, how will I show the capital introduced ?

Journal entry would be:

Computer Dr 50000

To Capital Cr 50000

So the capital account net balance will be 50000 negative ??

Instead, you can say, a credit balance of Rs.50000 in the capital account.

So I don't need to DR the capital account first ?? 

If not, How company is spending the money, if it didn't have the money at first place ?

If you bring in money to the business, capital account is credited and if you take out money from business, the same is debited. Suppose, you bring in money to business, then entry would be:

Cash/Bank Dr.

To Capital Cr.

Originally posted by : Raminder Singh Sandhu
	So how exactly will the entries work out ? e.g. 1. I paid Rs. 50000/- from my savings account for computers.

Entries will be like

1.  Raminder Singh Sandhu Cr 50000

     Holistic Consultants Dr 50000

2. Holistic Consultants Cr 50000

    Computer Dr 50000

am I right ??

Yes, you are right.

Is there any difference between capital account and drawing account ??

Raminder singh Sandhu is drawing account ?

Holistic Consultants is Capital account ?

Capital account means the money that you put into the business, in this case it is Raminder singh Sandhu. Drawings account is the account from which you withdraw money from the business. Thus,

1. Raminder singh Sandhu is a capital account
2. Holistic Consultants is a sundry creditor account