Osborne Books Tutor Zone

BookkeepingTransactionsAnswers to chapter activities

© Osborne Books Limited, 2016

1.1 (a) Invoice, credit note, cheque, petty cash voucher

1.2 (b) Sales ledger

1.3 The general ledger of a business normally contains the accounts of assets, which are

items owned and liabilities, which are items owed, and capital, which is the owner’s

investment in the business.

1.4 (a) £8,500; (b) £48,720; (c) £38,820; (d) £255,000

2.1

2 b o o k k e e p i n g t r a n s a c t i o n s t u t o r z o n e

The accounting system1

Financial documents for sales2

INVOICE No 2071CuCINa COOkwarE Date 09 09 20-410 Mantle StreetMereford MR2 RS4VAT Reg 105 1195 03

To R Copolis Customer code21 Sandy Lane, Stourford, ST1 5GH Delivery note no

Quantity Product code Price each £ Total £ Trade discount £ Goods £

20 LX25 30.00 600.00 120.00 480.00

VAT 96.00

Total 576.00

RC924

1791

a n s w e r s t o c h a p t e r a c t i v i t i e s 3

2.2 (c) Bulk discount

2.3

Date Details Debit £ Credit £ Balance £

1 October Invoice 2539 2,308.69 2,308.69

8 October Invoice 2586 1,905.60 4,214.29

14 October Invoice 2610 756.70 4,970.99

18 October Credit note 836 120.45 4,850.54

30 October Cheque 4,093.84 756.70

2.4 Product Customer General ledger code Customer code

Ace blender British Caterers GL1006 BRI08

Dinner plates Dansk Foods Ltd GL1012 DAN10

Soup spoons Bright Foods GL1004 BRI07

Pasta pan Alba Limited GL1001 ALB09

Coffee grinder Dancer Trading GL1014 DAN12

Canteen mugs Bright Foods GL1012 BRI07

2.5 (c) Purchase order

2.6 (c) £960.00

2.7 (b) £1,881.60

STaTEMENT OF aCCOuNT To Ramsay LtdCuCINa COOkwarE Date 31 10 20-410 Mantle Street, Mereford MR2 RS4

4 b o o k k e e p i n g t r a n s a c t i o n s t u t o r z o n e

Double-entry and the accounting equation3

3.1 (a) Financial transaction, financial document, book of prime entry, double-entry accounts

3.2

3.3 Debit Credit

Money paid for wages Wages Bank

Money received from Sales Bank Sales

Insurance of premises Insurance Bank

Capital paid in by owner Bank Capital

Bank loan received from bank Bank Bank loan

Payment for advertising costs Advertising Bank

Vehicle purchased Vehicle Bank

Vehicle sold Bank Vehicle

Bank loan repaid Bank loan Bank

3.4 See next page.

Purchases LedgerK HorrobinJ LloydP Woolley

Sales LedgerB TuckerJ PerksM Crawford

General LedgerSalesPurchasesInsuranceMotor VehiclesBank Loan

a n s w e r s t o c h a p t e r a c t i v i t i e s 5

Debit Sales account Credit

Date Details £ Date Details £

20-4 1 Mar Bank 5,678 2 Mar Bank 2,190 5 Mar Bank 9,300

Debit Purchases account Credit

Date Details £ Date Details £

20-41 Mar Bank 6,9122 Mar Bank 6,505

Debit Insurance account Credit

Date Details £ Date Details £

20-4 3 Mar Bank 4,600

Debit advertising account Credit

Date Details £ Date Details £

20-43 Mar Bank 5,980

Debit wages account Credit

Date Details £ Date Details £

20-44 Mar Bank 97,500

3.5 (a) (a) Assets minus liabilities equals capital

(b) Item asset Liability

VAT owed by HM Revenue & Customs 4

Property 4

Bank overdraft 4

Money owing to trade payables 4

Cash 4

Vehicle 4

(c) assets Liabilities Capital

£ £ £

80,000 20,000 60,000

50,000 40,000 10,000

89,500 49,500 40,000

61,700 26,700 35,000

90,867 67,820 23,047

89,100 38,500 50,600

3.6 Transaction Debit Credit

The business increases its bank loan 4

The business sells a warehouse 4

The total amount owed by trade receivables decreases 4

The business pays off its bank overdraft 4

The business buys a new computer 4

6 b o o k k e e p i n g t r a n s a c t i o n s t u t o r z o n e

3.7

a n s w e r s t o c h a p t e r a c t i v i t i e s 7

Dr DYI Stores (sales ledger) Cr

20-4 Details £ 20-4 Details £

14 Nov Sales 1,400.00 25 Nov Sales returns 185.00

17 Nov Sales 180.00 30 Nov Balance c/d 1,655.00

21 Nov Sales 260.00

1,840.00 1,840.00

1 Dec Balance b/d 1,655.00

7 b o o k k e e p i n g 1 w o r k b o o kDr L Dorado Ltd (purchases ledger) Cr

20-4 Details £ 20-4 Details £

22 Nov Purchases returns 250.60 14 Nov Purchases 834.90

30 Nov Balance c/d 1,004.59 20 Nov Purchases 245.45

25 Nov Purchases 174.84

1,255.19 1,255.19

1 Dec Balance b/d 1,004.59

Dr Marketing (general ledger) Cr

20-4 Details £ 20-4 Details £

18 Nov Bank 240.00 30 Nov Balance c/d 2,300.00

23 Nov Bank 720.00

26 Nov Bank 1,340.00

2,300.00 2,300.00

1 Dec Balance b/d 2,300.00

8 b o o k k e e p i n g t r a n s a c t i o n s t u t o r z o n e

Dr rent paid (general ledger) Cr

20-4 Details £ 20-4 Details £

5 Nov Bank 256.00 30 Nov Balance c/d 1,024.00

12 Nov Bank 256.00

19 Nov Bank 256.00

26 Nov Bank 256.00 1,024.00 1,024.00 1 Dec Balance b/d 1,024.00

4.1 (b) 2 sales account; 3 Value Added Tax account

4.2 (c) Account of P Lane, a trade receivable

4.3 (d) Sales invoice

Accounting for sales, returns anddiscounts4

4.4 (a) Sales Day Book SDB54

Date Details Invoice account Total VaT Net number code 20-4 £ £ £

5 Jun Outdoor Supplies 7234 SL190 660.00 110.00 550.00

8 Jun Beavan & Co 7235 SL050 1,050.00 175.00 875.00

12 Jun Larcombe Stores 7236 SL110 828.00 138.00 690.00

16 Jun Weatherproof Ltd 7237 SL220 1,452.00 242.00 1,210.00

22 Jun Beavan & Co 7238 SL050 750.00 125.00 625.00

27 Jun Weatherproof Ltd 7239 SL220 1,890.00 315.00 1,575.00

30 Jun Totals for month 6,630.00 1,105.00 5,525.00

GL1200 GL2200 GL4100

a n s w e r s t o c h a p t e r a c t i v i t i e s 9

(b) GENEraL LEDGEr Dr Sales ledger control account (GL1200) Cr 20-4 £ 20-4 £ 30 Jun Sales Day Book SDB54 6,630.00

Dr Value added Tax account (GL2200) Cr 20-4 £ 20-4 £ 30 Jun Sales day book SDB54 1,105.00

Dr Sales account (GL4100) Cr 20-4 £ 20-4 £ 30 Jun Sales day book SDB54 5,525.00

SaLES LEDGEr Dr Beavan & Co (SL050) Cr 20-4 £ 20-4 £ 8 Jun Sales SDB54 1,050.00 22 Jun Sales SDB54 750.00

Dr Larcombe Stores (SL110) Cr 20-4 £ 20-4 £ 12 Jun Sales SDB54 828.00

Dr Outdoor Supplies (SL190) Cr 20-4 £ 20-4 £ 5 Jun Sales SDB54 660.00

Dr weatherproof Limited (SL220) Cr 20-4 £ 20-4 £ 16 Jun Sales SDB54 1,452.00 27 Jun Sales SDB54 1,890.00

1 0 b o o k k e e p i n g t r a n s a c t i o n s t u t o r z o n e

4.5 (a) Sales returns Day Book SrDB18

Date Details Credit note account Total VaT Net number code 20-4 £ £ £

10 Jun Outdoor Supplies 224 SL190 90.00 15.00 75.00

18 Jun Beavan & Co 225 SL050 132.00 22.00 110.00

22 Jun Larcombe Stores 226 SL110 54.00 9.00 45.00

30 Jun Beavan & Co 227 SL050 146.40 24.40 122.00

30 Jun Totals for month 422.40 70.40 352.00

GL1200 GL2200 GL4110

(b) GENEraL LEDGEr

Dr Sales ledger control account (GL1200) Cr 20-4 £ 20-4 £ 30 Jun Sales day book SDB54 6,630.00 30 Jun Sales returns day book SRDB18 422.40

Dr Value added Tax account (GL2200) Cr 20-4 £ 20-4 £ 30 Jun Sales returns 30 Jun Sales day book SDB54 1,105.00 day book SRDB18 70.40

Dr Sales returns account (GL4110) Cr 20-4 £ 20-4 £ 30 Jun Sales returns

day book SRDB18 352.00

a n s w e r s t o c h a p t e r a c t i v i t i e s 1 1

SaLES LEDGEr Dr Beavan & Co (SL050) Cr 20-4 £ 20-4 £ 8 Jun Sales SDB54 1,050.00 18 Jun Sales returns SRDB18 132.00 22 Jun Sales SDB54 750.00 30 Jun Sales returns SRDB18 146.40

Dr Larcombe Stores (SL110) Cr 20-4 £ 20-4 £ 12 Jun Sales SDB54 828.00 22 Jun Sales returns SRDB18 54.00

Dr Outdoor Supplies (SL190) Cr 20-4 £ 20-4 £ 5 Jun Sales SDB54 660.00 10 Jun Sales returns SRDB18 90.00

4.6 (a) and (b)

Sales day book

Date Details Invoice Total VaT Net Sales Sales 20-X number £ £ £ type 1 £ type 2 £

30 June Avalos Ltd 2021 6,240 1,040 5,200 5,200 30 June Bolster & Co 2022 2,976 496 2,480 2,480 30 June Watsons 2023 2,112 352 1,760 1,760 Totals 11,328 1,888 9,440 2,480 6,960

1 2 b o o k k e e p i n g t r a n s a c t i o n s t u t o r z o n e

4.7 (a) Sales ledger

account name amount Debit Credit £ Durning Ltd 4,368 4

Penyard & Co 2,256 4

Merrimans 2,544 4

Porth plc 5,808 4

General ledger account name amount Debit Credit £

Sales 12,480 4

Value Added Tax 2,496 4

Sales ledger control 14,976 4

(b) Sales ledger

account name amount Debit Credit £ Sanchez & Co 672 4 Honnor Ltd 384 4

General ledger account name amount Debit Credit £ Sales returns 880 4 Value Added Tax 176 4 Sales ledger control 1,056 4

a n s w e r s t o c h a p t e r a c t i v i t i e s 1 3

(c) General ledger

account name amount Debit Credit £ Discounts allowed 35 4 Value Added Tax 7 4 Sales ledger control 42 4

Sales ledger account name amount Debit Credit £

Peaty & Co 30 4

Daley Ltd 12 4

Process payments from customers5

5.1 (c) There is a dispute over an invoice

5.2 (b) £1,440.00

5.3 (a) Invoice 490, credit note 295

(b) £3,203 Working: (£1,238 + £1,560 + £525 – £120)

4.8 Sales day book

Date Details Invoice Total VaT Net Product a14 Product B14 20-4 number £ £ £ £ £

30 June Montez Ltd 3456 600.00 100.00 500.00 500.00 30 June M Cyrek 3457 540.00 90.00 450.00 450.00 30 June A Rowland 3458 840.00 140.00 700.00 700.00 30 June Shah Ltd 3459 180.00 30.00 150.00 150.00

Totals 2,160.00 360.00 1,800.00 1,200.00 600.00

1 4 b o o k k e e p i n g t r a n s a c t i o n s t u t o r z o n e

6.1 (c) By the buyer when the goods arrive

6.2 (b) The delivery note

6.3 (c) Bulk discount

6.4Supplier Product ordered Supplier code General ledger code

Nextday Ltd Office desks NE009 GL1011

Pimania Ltd Black gel pens PI006 GL1008

Nero Associates A4 copy paper NE003 GL1009

Omega Traders Red fibre tip pens OM004 GL1008

Masters Ltd Suspension files MA008 GL1010

Nextday Ltd Office holiday planner NE009 GL1012

6.5 Has the correct item been supplied? Yes

Has the correct price been charged? No

What should the correct net figure be after deduction of discount? £1,500.00

What would be the VAT (charged @20%) if the invoice was correct? £300.00

Process documents from suppliers6

a n s w e r s t o c h a p t e r a c t i v i t i e s 1 5

Accounting for purchases, returns anddiscounts7

7.1 (a) 1 Purchases account; 2 Value Added Tax account

7.2 (d) Account of M Ostrowski, a trade payable

7.3 (b) and (d) are True, (a) and (c) are False

7.4 (a)

Purchases Day Book PDB38 Date Details Invoice account Total VaT Net

number code

20-2 £ £ £

4 Mar Taylor Supplies T/I459 PL680 632.40 105.40 527.00

8 Mar Keating & Co 3472 PL320 997.20 166.20 831.00

11 Mar Askews A862 PL040 826.80 137.80 689.00

18 Mar Taylor Supplies T/I550 PL680 1,170.00 195.00 975.00

25 Mar Melia Manufacturing 8817 PL410 682.80 113.80 569.00

28 Mar Askews A902 PL040 519.60 86.60 433.00

31 Mar Totals for month 4,828.80 804.80 4,024.00

GL2350 GL2200 GL5100

1 6 b o o k k e e p i n g t r a n s a c t i o n s t u t o r z o n e

(b) GENEraL LEDGEr

Dr Value added Tax account (GL2200) Cr 20-2 £ 20-2 £ 31 Mar Purchases day

book PDB38 804.80

Dr Purchases ledger control account (GL2350) Cr 20-2 £ 20-2 £ 31 Mar Purchases day

book PDB38 4,828.80 Dr Purchases account (GL5100) Cr 20-2 £ 20-2 £ 31 Mar Purchases day

book PDB38 4,024.00

PurCHaSES LEDGEr

Dr askews (PL040) Cr 20-2 £ 20-2 £ 11 Mar Purchases PDB38 826.80 28 Mar Purchases PDB38 519.60

Dr keating & Co (PL320) Cr 20-2 £ 20-2 £ 8 Mar Purchases PDB38 997.20

Dr Melia Manufacturing (PL410) Cr 20-2 £ 20-2 £ 25 Mar Purchases PDB38 682.80

Dr Taylor supplies (PL680) Cr 20-2 £ 20-2 £ 4 Mar Purchases PDB38 632.40 18 Mar Purchases PDB38 1,170.00

a n s w e r s t o c h a p t e r a c t i v i t i e s 1 7

7.5 (a)

Purchases returns Day Book PrDB12 Date Details Credit note account Total VaT Net

number code 20-2 £ £ £

12 Mar Taylor Supplies T/R270 PL680 98.40 16.40 82.00

18 Mar Keating & Co CN368 PL320 64.80 10.80 54.00

26 Mar Taylor Supplies T/R275 PL680 44.40 7.40 37.00

30 Mar Askews CN/A303 PL040 102.00 17.00 85.00

31 Mar Totals for month 309.60 51.60 258.00

GL2350 GL2200 GL5110

(b) GENEraL LEDGEr

Dr Value added Tax account (GL2200) Cr 20-2 £ 20-2 £ 31 Mar Purchases day 31 Mar Purchases returns

book PDB38 804.80 day book PRDB12 51.60

Dr Purchases ledger control account (GL2350) Cr 20-2 £ 20-2 £ 31 Mar Purchases returns 31 Mar Purchases day

day book PRDB12 309.60 book PDB38 4,828.80

Dr Purchases returns account (GL5110) Cr 20-2 £ 20-2 £ 31 Mar Purchases returns

day book PRDB12 258.00

1 8 b o o k k e e p i n g t r a n s a c t i o n s t u t o r z o n e

PurCHaSES LEDGEr

Dr askews (PL040) Cr 20-2 £ 20-2 £ 30 Mar Purchases returns 11 Mar Purchases PDB38 826.80 PRDB12 102.00 28 Mar Purchases PDB38 519.60

Dr keating & Co (PL320) Cr 20-2 £ 20-2 £ 18 Mar Purchases returns 8 Mar Purchases PDB38 997.20 PRDB12 64.80

Dr Taylor Supplies (PL680) Cr 20-2 £ 20-2 £ 12 Mar Purchases returns 4 Mar Purchases PDB38 632.40

PRDB12 98.40 18 Mar Purchases PDB38 1,170.00 26 Mar Purchases returns PRDB12 44.40

7.6 Purchases day book

Date Details Invoice Total VaT Net Purchases Purchases 20-X number £ £ £ type 1 £ type 2 £

30 June Kinnear & Co 4513 5,472 912 4,560 4,560 30 June Boswells B/364 4,608 768 3,840 3,840 30 June Zamora Ltd Z274 3,552 592 2,960 2,960 Totals 13,632 2,272 11,360 4,560 6,800

7.7 (a) Purchases ledger

account name amount Debit Credit £ Thorpe Ltd 2,112 4

Avalos plc 2,832 4

Barkers 6,144 4

Floyd & Co 5,616 4

a n s w e r s t o c h a p t e r a c t i v i t i e s 1 9

General ledger

account name amount Debit Credit £ Purchases 13,920 4 Value Added Tax 2,784 4

Purchases ledger control 16,704 4

(b) Purchases ledger

account name amount Debit Credit £ Church Stores 336 4

Thornton Ltd 672 4

General ledger

account name amount Debit Credit £

Purchases returns 840 4

Value Added Tax 168 4

Purchases ledger control 1,008 4

(c) General ledger

account name amount Debit Credit £

Discounts received 55 4

Value Added Tax 11 4

Purchases ledger control 66 4

Purchases ledger

account name amount Debit Credit £ Rimkus 18 4 D R Thorne Ltd 48 4

2 0 b o o k k e e p i n g t r a n s a c t i o n s t u t o r z o n e

7.8 Purchases day book

Date Details Invoice Total VaT Net Product a14 Product B1420-4 number £ £ £ £ £

30 June Blenheim Ltd 7234 600.00 100.00 500.00 500.0030 June P Olumbi 6945 1,008.00 168.00 840.00 840.0030 June Carholme Ltd 2176 1,296.00 216.00 1,080.00 1,080.0030 June S Lucas 3085 720.00 120.00 600.00 600.00

Totals 3,624.00 604.00 3,020.00 1,920.00 1,100.00

Prepare payments to suppliers8

8.1 (b) A decrease in the total amount owing shown on the statement of account

8.2 (c) Advise the supplier of the total amount being paid by the customer

8.3 (b) Will mean the supplier’s statement of account will show a higher balance owing than the purchases ledger account

8.4 (a) Cheque for £1,200(b) Invoice 1290(c) £760 Working: £1,960 – £1,200

8.5 (a) (c) To Manzini & Co(b) (d) 31 May(c) (c) Invoice 2449, Invoice 2687(d) (a) £3,897

a n s w e r s t o c h a p t e r a c t i v i t i e s 2 1

Cash book9

9.1 (a) Sales ledger

account name amount Debit Credit £

Thorntons Ltd 5,000 4

(b) General ledger

account name amount Debit Credit £

Sales ledger control 5,000 4

Rent 2,250 4

Wages 3,695 4

Office expenses 88 4

2 2 b o o k k e e p i n g t r a n s a c t i o n s t u t o r z o n e

9.2 (a) True

(b) False – the balance b/d of £975 on 1 October shows that, according to the cash book, thereis a bank overdraft.

(c) GENEraL LEDGEr

Dr Sales account Cr 20-1 £ 20-1 £ 30 Sep Bank CB45 120

Dr Sales ledger control account Cr 20-1 £ 20-1 £ 30 Sep Bank CB45 1,150

Dr Purchases ledger control account Cr 20-1 £ 20-1 £ 30 Sep Bank CB45 760 Dr Purchases account Cr 20-1 £ 20-1 £ 30 Sep Bank CB45 240

Dr General expenses account Cr 20-1 £ 20-1 £ 30 Sep Bank CB45 75

Dr wages account Cr 20-1 £ 20-1 £ 30 Sep Bank CB45 2,365

Dr Office equipment account Cr 20-1 £ 20-1 £ 30 Sep Bank CB45 890

a n s w e r s t o c h a p t e r a c t i v i t i e s 2 3

(d) SaLES LEDGEr Dr Cooper Limited Cr 20-1 £ 20-1 £ 30 Sep Bank CB45 1,150

PurCHaSES LEDGEr Dr Nugent & Co Cr 20-1 £ 20-1 £ 30 Sep Bank CB45 760

2 4 b o o k k e e p i n g t r a n s a c t i o n s t u t o r z o n e

9.3

D

r

Cash

Boo

k

Cr

Date

Det

ails

C

ash

B

ank

D

ate

De

tails

Ca

sh

B

ank

20-7

£

£

20-

7

£

£

3

Sep

Bala

nce

b/d

3

60

3

Sep

Ba

lance

b/d

1,07

6

3

Sep

Sale

s

2

45

4

Sep

Ra

tes

307

5

Sep

Ahm

ed L

td

1,

160

8

Sep

W

ages

390

8 S

ep

XJ S

uppli

es

720

10

Sep

Balan

ce c

/d

1,

968

1

0 Se

p

Dr

awing

s

50

0

10

Sep

Rent

52

5

10

Sep

Balan

ce c

/d

215

6

05

3,

128

6

05

3

,128

11

Sep

Balan

ce b

/d

215

11

Sep

Balan

ce b

/d

1,

968

a n s w e r s t o c h a p t e r a c t i v i t i e s 2 5

9.4 (a) Bank transfer of £10,000 to increase the owner’s capital

9.5 (c) Bank charges of £35

9.6 Statement True False

(a) The cash book is the book of prime entry for bank and cash receipts and payments (except for 4 some low-value cash payments)

(b) The trade receivables column total from cash book is debited to the sales ledger control 4 account in the general ledger

(c) The trade payables column total from cash book is debited to the purchases ledger control 4 account in the general ledger

(d) The amount of VAT on credit purchases is recorded in the VAT column on the payments 4 side of cash book

2 6 b o o k k e e p i n g t r a n s a c t i o n s t u t o r z o n e

9.7 (a) Cash book – credit side

Details Cash Bank VaT Trade Cash Stationery payables purchases expenses £ £ £ £ £ £

Thorpe & Co 96 16 80

E Rojas 144 24 120

Melia Ltd 755 755

Southern Stationery 192 32 160

Watson & Co 1,750 1,750

Totals 240 2,697 72 2,505 200 160

(b) Cash book – debit side

Details Cash Bank VaT Trade Cash receivables sales £ £ £ £ £

Balance b/f 521 1,155

S Paine Ltd 840 840

Bromfields 394 394

F Bridger 312 52 260

Totals 833 2,389 52 1,234 260

(c) £593

(d) £–308

(e) Debit

Credit 4

a n s w e r s t o c h a p t e r a c t i v i t i e s 2 7

9.8 (a) Cash book – credit side

Details Cash Bank VaT Trade Cash Other payables purchases expenses £ £ £ £ £ £

Balance b/f 1,625

Toni Gray 264 44 220

A-Z Insurers 650 650

Amos plc 1,764 1,764

J Gosai 960 960

Totals 264 4,999 44 2,724 220 650

(b) Cash book – debit side

Details Cash Bank VaT Trade Other receivables income £ £ £ £ £

Balance b/f 510

CBT plc 1,380 1,380

Notley Ltd 1,465 1,465

Kristina Ltd 250 250

Totals 760 2,845 2,845 250

(c) £496

(d) £–2,154

2 8 b o o k k e e p i n g t r a n s a c t i o n s t u t o r z o n e

10.1 (b) They must have relevant documentation attached to show that the amount claimed is correct

10.2 (c) Debit petty cash control £122; credit bank £122

10.4 (b) £146.27

10.5 (c) £113.15

10.6 General ledger

account name amount Debit Credit £

Petty cash book 65 4

Bank 65 4

Petty cash book10

10.3 Statement True False

(a) Petty cash vouchers are financial documents

against which payments are made out of petty cash

(b) The petty cash book is a part of double-entry bookkeeping only

(c) Receipts from the bank to top-up the petty cash imprest amount are recorded on the debit side of petty cash book

(d) Petty cash book is the book of prime entry for low-value cash payments

4

4

4

4

a n s w e r s t o c h a p t e r a c t i v i t i e s 2 9

10.7 General ledger

account name amount Debit Credit £

VAT 5.12 4

Postage 9.53 4

Travel expenses 19.55 4

Office expenses 25.60 4

Bank 77.00 4

10.8

(a) Petty cash book

Details amount Details amount VaT Stationery Postage £ £ £ £ £

Balance b/f 100.00 Envelopes 12.00 2.00 10.00

Ring binders 24.00 4.00 20.00

Postage stamps 15.00 15.00

A4 paper 10.80 1.80 9.00

Balance c/d 38.20 Total 100.00 Totals 100.00 7.80 39.00 15.00

(b) (a) Stationery (c) Postage (e) VAT

(c) £61.80

3 0 b o o k k e e p i n g t r a n s a c t i o n s t u t o r z o n e

10.9 (a) GENEraL LEDGEr Dr Value added Tax account Cr 20-8 £ 20-8 £ 31 Aug Petty cash book PCB28 10.64

Dr Travel account Cr 20-8 £ 20-8 £ 31 Aug Petty cash book PCB28 24.55

Dr Postage account Cr 20-8 £ 20-8 £ 31 Aug Petty cash book PCB28 7.65 16 Aug Petty cash book PCB28 4.80

Dr Stationery account Cr 20-8 £ 20-8 £ 31 Aug Petty cash book PCB28 23.20

Dr Sundry expenses account Cr 20-8 £ 20-8 £ 31 Aug Petty cash book PCB28 20.00

Dr Purchases ledger control account Cr 20-8 £ 20-8 £ 31 Aug Petty cash book PCB28 19.35

Dr Petty cash control account Cr 20-8 £ 20-8 £ 1 Aug Balance b/d 150.00 31 Aug Petty cash book PCB28 105.39 31 Aug Petty cash book PCB28 4.80 31 Aug Balance c/d 150.00 31 Aug Bank CB 100.59 255.39 255.39 1 Sep Balance b/d 150.00

Dr Cash book (bank column) Cr 20-8 £ 20-8 £ 31 Aug Petty cash PCB28 100.59

(b) PurCHaSES LEDGEr Dr T Carline Cr 20-8 £ 20-8 £ 31 Aug Petty cash book PCB28 19.35

a n s w e r s t o c h a p t e r a c t i v i t i e s 3 1

10.10 (a) £Amount in petty cash box 78.25

Balance on petty cash account 79.25Difference 1.00

(b) Petty cash reimbursement

Date: 31.10.20-7 Amount required to restore the cash in the petty cash box £166.03

3 2 b o o k k e e p i n g t r a n s a c t i o n s t u t o r z o n e

11.3account name amount Debit Credit £ £ £Bank (cash at bank) 2,649 2,649Loan from bank 8,500 8,500Office equipment 12,200 12,200Vehicles 20,750 20,750Inventory 8,608 8,608Petty cash control 66 66 VAT owing to HM Revenue & Customs 1,261 1,261Purchases 89,738 89,738Purchases returns 2,107 2,107Purchases ledger control 26,846 26,846Sales 147,924 147,924Sales returns 3,842 3,842Sales ledger control 37,411 37,411Discounts received 276 276Discounts allowed 135 135Capital 34,731 34,731Drawings 13,244 13,244Advertising 2,827 2,827Insurance 967 967Heating and lighting 4,326 4,326Rent and rates 5,368 5,368Telephone 971 971Miscellaneous expenses 379 379Wages 18,164 18,164Totals – 221,645 221,645

11.1 (a) Drawings account

11.2 (d) Capital account

The initial trial balance11

a n s w e r s t o c h a p t e r a c t i v i t i e s 3 3

11.4account name amount Debit Credit £ £ £Sales ledger control 40,272 40,272Sales 175,843 175,843Sales returns 2,316 2,316Purchases ledger control 22,433 22,433Purchases 105,871 105,871Purchases returns 1,045 1,045Office equipment 18,395 18,395Vehicles 34,170 34,170Rent and rates 6,842 6,842Advertising 3,776 3,776Insurance 2,097 2,097Wages 37,864 37,864Heating and lighting 3,791 3,791Postages and telephone 1,946 1,946 Miscellaneous expenses 558 558Discounts received 654 654Discounts allowed 317 317Capital 75,737 75,737Drawings 25,650 25,650Inventory 12,415 12,415Petty cash control 119 119Bank (overdraft) 3,086 3,086VAT owing to HM Revenue & Customs 2,041 2,041Loan from bank 15,560 15,560Totals – 296,399 296,399

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11.5Item Capital revenue Capital revenue expenditure expenditure income income

Receipts from sale of goods tocredit customers

Increase in owner’s capital

Purchase of office equipment

Purchase of stationery for usein the office

Bank loan received

Redecoration of property

4

4

4

4

4

4