BUS285: Technology & Accounting Processes Assessment Answers

Technology & Accounting Processes Assignment Help

This assignment runs in tandem with the lecture topics in this course. You are advised to work through the case progressively as the course progresses rather than wait until just before the assignment is due, to try and do everything. You are required to complete the assignment as a group of 3 students. You are required to find your own group members and you are not restricted to your workshop class. There is a discussion board on LMS for anyone having difficulty finding a group and some assistance will be provided in workshops at the start of semester to help with this process. You are strongly advised to establish your group and work on the assignment throughout the semester. If you haven’t formed a group, still try to do the part of the assignment that relates to each lecture topic as we do it in order to be able to complete the assignment on time and not be overwhelmed at the end. The assignment is broken down into lecture topics with the relevant chapter from the text provided. Working papers and report templates are provided with these instructions. If you have any concerns or problems with the assignment throughout the semester, please see your tutor or unit coordinator early on so that you can progress with the assignment. If you have any problems with your group members you are advised to read and complete the group charter in the appendix of the unit information and learning guide. Students are expected to be able to work successfully in groups to complete the assignment, if this is proving difficult and you have tried to implement the strategies outlined in the group charter, you are advised to discuss the matter with your tutor or unit coordinator. We do not want to be informed about group problems when the assignment is handed in, we want to know about any problems or issues early on when they occur, so they can be dealt with and appropriate action taken before it is too late. The Recording Process David Johnson has decided that a company is the best business structure for him and on 1 July, 2015 Electronic Emporium Pty Ltd was incorporated as a private company with David as sole director/shareholder. The company now has a tax file number and an Australian Business Number and at this stage David has decided not to register the company for GST. David has signed a lease on a shop for 2 years with an option to renew for a further 5 years. He has opened a bank account in the company’s name with the ANZ Bank, and at the same time applied for a loan of $50,000 from the bank to enable him to set up the shop and provide him with working capital. He contracted a shopfitter to fit out the shop, which opened for business on 1 July. As David’s accountant you have recommended that the following accounts are used as a guide when setting up the chart of accounts for the general ledger: accountancy fees (600), accounts payable (200), accounts receivable (120), advertising expense (605), bank fees (610), bank loan (280), borrowing expenses, cash at bank (100), depreciation expense, discount allowed, dividends (351), electricity expense, insurance expense, interest expense, motor vehicles expense, motor vehicles (160), accumulated depreciation – motor vehicles (161), office supplies expense, prepaid advertising (140), prepaid insurance (145), prepaid rent (150), rent expense, repairs expense, retained earnings (350), service revenue (400), share capital (300), shareholders loan account (250), shop equipment and fittings (170), accumulated depreciation – shop equipment and fittings and telephone expense. Transactions for the first month of operation: July 1 David deposited $10,000 to open the business bank account. This was his investment in the company in exchange for 10,000 ordinary shares. David purchased from Tony’s Second-hand Mart, a cash register for $350, a lounge suite for $400 and a table and chairs for $380 for the shop (cheque no. 1). 5 The bank deposited the $49,500 loan funds into the bank after deducting $500 in costs to establish the loan. (Hint: Post the costs to establish the loan to borrowing expenses). 7 Paid rent of $1,980 to Atlas Realty (cheque no. 2). 8 Paid Adams Shopfitters $20,000 for display cabinets, counters and shelving (cheque no. 3). 12 Paid the local newspaper (Community Times) $1,000 for a series of weekly advertisements to comment this week (cheque no. 4). 14 Paid $1,460 to Bayview Insurance Brokers for a 1-year business insurance policy commencing 21 July (cheque no.5). 24 David contributed equipment valued at $5,000 for repairing computers to the business. At present he does not want to take cash out of the business, so this will take the form of an interest free loan to be repaid two years from now. 31 Banked $2,520 cash and cheques from servicing computers since the shop opened. Required

1. Use the worksheet provided create the chart of accounts ensuring that you correctly classify the accounts by type, i.e. asset, liability, equity, revenue, cost of sales and expenses. A few account numbers have been provided as a guide. Asset accounts begin with the number 100, liabilities with 200, equity with 300, income with 400, purchases of inventory with 500, and expenses with 600. (Hint: number expense and prepayment accounts 5 numbers apart, and for all other accounts number the accounts 10 numbers apart. Exceptions are related non-current asset accounts, which use consecutive numbers for the cost of the asset and the corresponding accumulated depreciation for that asset).
2. Use the general journal to record the transactions for July, with brief narrations.
3. Post the journal entries to the general ledger T accounts. Remember to include posting references as they provide an audit trail. Use pencil to subtotal and calculate the balance of each account. Do not close off these accounts as they will be used again.
4. Prepare a trial balance on 31 July.

PART 1 Guidelines for group assignment This assignment runs in tandem with the lecture topics in this course. You are advised to work through the case progressively as the course progresses rather than wait until just before the assignment is due, to try and do everything. You are required to complete the assignment as a group of 3 students. You are required to find your own group members and you are not restricted to your workshop class. There is a discussion board on LMS for anyone having difficulty finding a group and some assistance will be provided in workshops at the start of semester to help with this process. You are strongly advised to establish your group and work on the assignment throughout the semester. If you haven’t formed a group, still try to do the part of the assignment that relates to each lecture topic as we do it in order to be able to complete the assignment on time and not be overwhelmed at the end. The assignment is broken down into lecture topics with the relevant chapter from the text provided. Working papers and report templates are provided with these instructions. If you have any concerns or problems with the assignment throughout the semester, please see your tutor or unit coordinator early on so that you can progress with the assignment. If you have any problems with your group members you are advised to read and complete the group charter in the appendix of the unit information and learning guide. Students are expected to be able to work successfully in groups to complete the assignment, if this is proving difficult and you have tried to implement the strategies outlined in the group charter, you are advised to discuss the matter with your tutor or unit coordinator. We do not want to be informed about group problems when the assignment is handed in, we want to know about any problems or issues early on when they occur, so they can be dealt with and appropriate action taken before it is too late. ASSIGNMENT INSTRUCTIONS Although the case is based on a fictitious business, the scenarios and challenges this business faces are typical of the processes and issues business owners and managers are likely to encounter. The lecture material that will enable you to begin work on the case will be provided from session 2 onwards. This assignment provides practical application of the topics we cover in this unit plus some extra chapters from the text book. The material provided herewith is up to lecture session 5 (Part 1). The remainder of the assignment (Part 2) will be posted onto LMS in week 6 (Session 5) of semester. The Recording Process David Johnson has decided that a company is the best business structure for him and on 1 July, 2015 Electronic Emporium Pty Ltd was incorporated as a private company with David as sole director/shareholder. The company now has a tax file number and an Australian Business Number and at this stage David has decided not to register the company for GST. David has signed a lease on a shop for 2 years with an option to renew for a further 5 years. He has opened a bank account in the company’s name with the ANZ Bank, and at the same time applied for a loan of $50,000 from the bank to enable him to set up the shop and provide him with working capital. He contracted a shopfitter to fit out the shop, which opened for business on 1 July. As David’s accountant you have recommended that the following accounts are used as a guide when setting up the chart of accounts for the general ledger: accountancy fees (600), accounts payable (200), accounts receivable (120), advertising expense (605), bank fees (610), bank loan (280), borrowing expenses, cash at bank (100), depreciation expense, discount allowed, dividends (351), electricity expense, insurance expense, interest expense, motor vehicles expense, motor vehicles (160), accumulated depreciation – motor vehicles (161), office supplies expense, prepaid advertising (140), prepaid insurance (145), prepaid rent (150), rent expense, repairs expense, retained earnings (350), service revenue (400), share capital (300), shareholders loan account (250), shop equipment and fittings (170), accumulated depreciation – shop equipment and fittings and telephone expense. Transactions for the first month of operation: July 1 David deposited $10,000 to open the business bank account. This was his investment in the company in exchange for 10,000 ordinary shares. David purchased from Tony’s Second-hand Mart, a cash register for $350, a lounge suite for $400 and a table and chairs for $380 for the shop (cheque no. 1). 5 The bank deposited the $49,500 loan funds into the bank after deducting $500 in costs to establish the loan. (Hint: Post the costs to establish the loan to borrowing expenses). 7 Paid rent of $1,980 to Atlas Realty (cheque no. 2). 8 Paid Adams Shopfitters $20,000 for display cabinets, counters and shelving (cheque no. 3). 12 Paid the local newspaper (Community Times) $1,000 for a series of weekly advertisements to comment this week (cheque no. 4). 14 Paid $1,460 to Bayview Insurance Brokers for a 1-year business insurance policy commencing 21 July (cheque no.5). 24 David contributed equipment valued at $5,000 for repairing computers to the business. At present he does not want to take cash out of the business, so this will take the form of an interest free loan to be repaid two years from now. 31 Banked $2,520 cash and cheques from servicing computers since the shop opened. Required

1. Use the worksheet provided create the chart of accounts ensuring that you correctly classify the accounts by type, i.e. asset, liability, equity, revenue, cost of sales and expenses. A few account numbers have been provided as a guide. Asset accounts begin with the number 100, liabilities with 200, equity with 300, income with 400, purchases of inventory with 500, and expenses with 600. (Hint: number expense and prepayment accounts 5 numbers apart, and for all other accounts number the accounts 10 numbers apart. Exceptions are related non-current asset accounts, which use consecutive numbers for the cost of the asset and the corresponding accumulated depreciation for that asset).
2. Use the general journal to record the transactions for July, with brief narrations.
3. Post the journal entries to the general ledger T accounts. Remember to include posting references as they provide an audit trail. Use pencil to subtotal and calculate the balance of each account. Do not close off these accounts as they will be used again.
4. Prepare a trial balance on 31 July.

Accrual Accounting Concepts It is the end of the month and even though David has not been in business very long he is anxious to see how the business is doing. He hopes he has made a profit because he needs to be able to make a reasonable living out of the business. Required

1. Using the information provided below, record the necessary adjusting entries in the general journal (provide brief narrations) and post to the general ledger, using pencil, total the general ledger accounts. (Hint: Round all calculations to the nearest dollar).

1. Rent is $990 per calendar month and rent has been paid for the period up to the end of August.
2. The advertising was for a series of five weekly advertisements and only two of these were used in July.
3. The commencement date for the annual business insurance premium is 21 July.
4. A telephone was installed in the shop on 21 July, but the bill has not been received. David estimates the monthly bill (for 31 days) will be $155. The business has been operating for only 10 days of this month.
5. The company is to pay for the electricity usage for half of the month of July, but will not receive a bill until mid-September. David estimates the bill will be approximately $360.
6. Depreciation on shop equipment and fittings is $132 for July.
7. Interest charged to the bank loan account for July is $96.

 

1. Using the worksheet provided, complete the worksheet by determining the adjusted trial balance and the statement of profit or loss and the statement of financial position columns for July. (Hint: only complete the worksheet for the accounts with balances, not for all accounts in the general ledger).
2. Prepare a post-closing trial balance.

Inventories David has received requests from customers for laptop computers and other related items, so he has decided that now is the time to expand his computer service business to include the sale of electronic equipment. David plans to keep Electronic Emporium Pty Ltd as a very small business so that keeping track of inventory levels will not be a problem. The periodic inventory system is the simplest method for recording inventory; however, the perpetual inventory system has the advantage of providing current inventory and cost of sales values at any time that information is required. David has decided to use the perpetual inventory system for his business. David has now registered the business for GST at the rate of 10%. Your chart of accounts and general ledger will need to be updated to include the following accounts: inventory (130), GST Paid (155), GST Collected (260), sales revenue (410), sales returns and allowances (420), discount received (430), cost of sales (500), freight inwards (520). Use the accounts receivable and accounts payable accounts for all transactions that involve credit terms. Transactions for the month include GST where relevant. The cost of inventory sold is 60% of the selling price: Aug. 3 Received inventory from Samsung on terms of n/30. The total value of its invoice was $13,200 including a freight charge of $110. 5 Cash sales to the value of $1,584 were made and the money banked. 10 Received inventory from Sony on terms of 2/7, n/30. The total value of its invoice was $5,500. 11 Credit sale of $3,300 to Clear Vision Opticians on terms of n/15. 13 Clear Vision Opticians returned one of the items sold because the screen was cracked. Electronic Emporium Pty Ltd issues a credit note for $330. 14 Sent cheque no. 6 to Sony as payment for the amount owing. 17 Made a credit sale to ABC Accountants on terms 5/7, n/30. The total value of this sale was $1,980. 18 A repayment of $1,000 was made on the bank loan. 21 Cash sales for the week totalled $4,950 were banked. 23 Received and banked a cheque from ABC Accountants in settlement of their account. 25 Received and paid the telephone bill of $165 with cheque no. 7. 31 The inventory item returned to Electronic Emporium Pty Ltd by a customer was returned to Samsung as the damage occurred in transit. A credit note was received from Samsung for $220. Required

1. Use the general journal to prepare any reversing entries, include brief narrations.
2. Record the transactions for August in the general journal with brief narrations.
3. Post the journal entries to the general ledger. This is a continuation from the previous section, so use existing and new general ledger accounts. Use pencil to subtotal and calculate the balance of each account. Do not close off these accounts as they will be used again in the next section.
4. Prepare a trial balance as at 31 August.

WORKING PAPERS ACCOUNTING WORKING PAPERS AND REPORT TEMPLATES – LECTURE 2 WORKSHEET - Chart of Accounts

Account no.	Account name	Element (Asset, etc)	Current/non-current
	Assets
100	Cash at bank	Current Asset	Current
120	Account receivable	Current Asset	Current
130	Inventory	Current Asset	Current
140	Prepaid advertising	Current Asset	Current
145	Prepaid insurance	Current Asset	Current
150	Prepaid rent	Current Asset	Current
155	GST paid	Current Asset	Current
160	Motor Vehicles Account	Non-current Asset	Non-current
161	Accumulated depreciation- motor vehicles	Accumulated expense	Non-current
170	Shop equipment and fittings	Non-current Asset	Non-current
171	Accumulated depreciation- shop equipment and fittings	Accumulated expense	Non-current
	Liabilities
200	Accounts payable	Current liability	Current
210	Telephone payable	Current liability	Current
215	Electricity payable	Current liability	Current
220	Interest payable	Current liability	Current
250	Shareholder’s loan account	Non-Current liability	Non-current
260	GST collected	Current liability	Current
280	Bank loan		Non-current
	Equity
300	Share capital
350	Retained earning
351	Dividends	Profit appropriation
	Revenue
400	Service revenue
410	Sale revenue
420	Sales returns and allowances
430	Discount received
	Inventory
500	Cost of sales
520	Freight Inwards
	Expenses
600	Accountancy fees
605	Advertising expense
610	Bank fees
615	Borrowing expense
620	Depreciation expense
625	Discount allowed
630	Electricity expense
635	Insurance expense
640	Interest expense
645	Office supplies expense
650	Repairs expense
655	Rent expense
665	Telephone expense

GENERAL JOURNAL (1)

Date		Description	Post Ref	Debit		Credit
July	01	Cash at bank	100	10,000
		Share capital (initial investment)	300			10,000
		Shop equipment and fittings	170	350
		Cash at bank (cash register purchased: Chq-1)	100			350
		Shop equipment and fittings	170	400
		Cash at bank (lounge suit purchased: Chq-1)	100			400
		Shop equipment and fittings	170	380
		Cash at bank (purchase of table and chair: Chq-1)	100			380
	05	Cash at bank	100	49,500
		Borrowing expense	615	500
		Bank loan (Loan amount debited to bank a/c)	280			50,000
	07	Rent Expense	655	1,980
		Cash at bank (rent paid to Atlas Realty)	100			1,980

GENERAL JOURNAL

Date		Description	Post Ref	Debit		Credit
	08	Shop equipment and fittings	170	20,000
		Cash at bank (Charges for display cabinets, counters, and shelf fitting paid)	100			20,000
	12	Advertising expense	605	1,000
		Cash at bank (prepaid to Community Times)	100			1,000
	14	Insurance expenses	635	1,460
		Cash at bank (prepaid to Bayview Insurance Broker)	100			1,460
	24	Shop equipment and fittings	1704	5,000
		Shareholder's loan account (Equipment contributed by David against interest free interest)	250			5,000
	31	Cash at bank	100	2,500
		Service revenue (service computing revenue)	400			2,500

GENERAL LEDGER Name: CASH AT BANK Acc No: 100

Date		Details	Post. Ref.	Debit	Date		Details	Post. Ref.	Credit
Jul	1	Share capital	300	10,000	Jul	1	Shop equipment and fittings	170	350
	5	Bank loan	280	49,500			Shop equipment and fittings	170	400
	31	Service revenue	400	2,500			Shop equipment and fittings	170	380
						7	Rent expenses	655	1,980
						8	Shop equipment and fittings	170	20,000
						12	Advertising expenses	605	1,000
						14	Insurance expenses	635	1,460
						31	Balance c/f		36,430
Aug	1	Balance b/f		36430
Aug	5	Sale revenue		1,584	Aug	14	Account payables		5390
						18	bank loan		1,000
	21	Sale revenue		4,950		25	Pay telephone bill		165
	23	Account receivable (ABC Accountants)		1,881
						31	Balance c/f		38290

Name: ACCOUNTS RECEIVABLE Acc No: 120

Date		Details	Post. Ref.	Debit			Date		Details	Post. Ref.		Credit
Aug	14	Clear Vision Opticians		3,300		Aug		13	Clear Vision Opticians				330
	17	ABC Accountants		1,980				23	ABC Accountants				1,980
				5,280									2,310
		Ending balance		2,970

Name: INVENTORY Acc No: 130

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Aug	3	Samsung		11,900		Aug	5	Cost of sales		864
	10	Sony		5,000			11	Cost of sales		1800
	13	Cost of sales		180			17	Cost of sales		1080
							21	Cost of sales		2,700
							31	Account payables(Samsung)		200
				17,080						6644
		Ending balance		10436

Name: PREPAID ADVERTISING Acc No: 140

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Jul	31	Advertising Expense	605	600		Jul	31	Balance c/f		600
Aug	1	Balance b/f		600		Aug	1	advertising expense		600

Name: PREPAID INSURANCE Acc No: 145

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Jul	31	Insurance Expense	635	1416		Jul	31	Balance c/f		1416
Aug	1	Balance b/f		1416		Aug	1	insurance expense		124
						Aug	31	Balance c/f		1292

Name: PREPAID RENT Acc No: 150

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Jul	31	Rent Expense	655	990
						Jul	31	Balance c/f		990
Aug	1	Balance b/f		990		Aug	1	Rent expense		990

GENERAL LEDGER Name: GST PAID Acc No: 155

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Aug	3	Account Payable		1,190		Aug	14	Account Payable		11
	10	Account Payable		500			31	Account Payable		20
	23	Account Payable		10
		Ending balance		1,669

Name: MOTOR VEHICLES Acc No: 160

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit

GENERAL LEDGER Name: ACCUMULATE DEPRECIATION – MOTOR VEHICLES Acc No: 161

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit

Name: SHOP EQUIPMENT & FITTINGS Acc No: 170

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Jul	01	Cash at Bank	1701	350
		Cash at Bank	1702	400
		Cash at Bank	1703	380
	08	Cash at Bank		20,000
	24	Shareholder’s Loan	1704	5,000		Jul	31	Balance c/f		26,130

Name: ACCUMULATED DEPRECIATION – SHOP EQUIPMENT & FITTTINGS Acc No: 171

Date		Details	Post. Ref.	Debit	Date		Details	Post. Ref.	Credit
					Jul	31	Depreciation expense	171	132
							Ending balance		132

GENERAL LEDGER Name: ACCOUNTS PAYABLE Acc No: 200

Date		Details	Post. Ref.	Debit	Date		Details	Post. Ref.	Credit
Aug	14	To Sony		5,500	Aug	3	From Samsung		13,200
	31	Return to Samsung		220		10	From Sony		5,500
				5,720					18,700
							Ending balance		12,980

Name: TELEPHONE PAYABLE Acc No: 210

Date		Details	Post. Ref.	Debit	Date		Details	Post. Ref.	Credit
					Jul	31	Telephone expenses	665	55
Aug	25	Cash at bank		55

Name: ELECTRICITY PAYABLE Acc No: 215

Date		Details	Post. Ref.	Debit	Date		Details	Post. Ref.	Credit
					Jul	31	Electricity expenses	630	180
Aug	1	Balance b/f		180
					Aug	31	Electricity expenses	630	180
Aug	31	Balance c/f		360

GENERAL LEDGER Name: INTEREST PAYABLE Acc No: 220

Date		Details	Post. Ref.	Debit	Date		Details	Post. Ref.	Credit
					July	31	Interest expenses	640	96
Jul	31	Balance C/f		96

Name: SHAREHOLDERS LOAN ACCOUNT Acc No: 250

Date		Details	Post. Ref.	Debit	Date		Details	Post. Ref.	Credit
					Jul	24	Shop equipment and fittings	250	5,000
Jul	31	Balance C/f		5,000

Name: GST COLLECTED Acc No: 260

Date		Details	Post. Ref.	Debit	Date		Details	Post. Ref.	Credit
					Aug	5	Account Receivable		144
Aug	13	Account Receivable		30	180	11	Account Receivable		300
					450	17	Account Receivable		180
						21	Account Receivable		450
		balance		1044

GENERAL LEDGER Name: BANK LOAN Acc No: 280

Date		Details	Post. Ref.	Debit	Date		Details	Post. Ref.	Credit
					Jul	5	Cash at Bank	100	49,500
							Borrowing expenses		500
Jul	31	Balance c/f		50,000
Aug	18	Cash at Bank	100	1000
					Aug	31	Balance c/f		49000

Name: SHARE CAPITAL Acc No: 300

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
						Jul	1	Cash at Bank	300	10,000
Jul	31	Balance c/f		10,000

Name: RETAINED EARNINGS Acc No: 350

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
						Jul	31	Profit	350	103
								Ending balance		103

GENERAL LEDGER Name: DIVIDENDS Acc No: 351

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit

Name: PROFIT OR LOSS SUMMARY Acc No: 330

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit

Name: SERVICE REVENUE Acc No: 400

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
						Jul	31	Cash at Bank	400	2,500

GENERAL LEDGER Name: SALES REVENUE Acc No: 410

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
						Aug	5	Cash sale	4101	1,440
							11	Account Receivable	4102	3,000
							17	Account Receivable	4103	1,800
							21	Cash sale	4101	4,500
								Ending balance		10,740

Name: SALES RETURNS & ALLOWNCES Acc No: 420

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Aug	13	From Clear Vision	420	300
		Ending balance		300

Name: DISCOUNT RECEIVED Acc No: 430

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
						Aug	14	From Sony	430	99
								Ending balance		99

GENERAL LEDGER Name: COST OF SALES Acc No: 500

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Aug	5	Inventory		864		Aug	13	Inventory		180
	17	Inventory		1800
	21	Inventory		1080
	11	Inventory		2700
		Ending balance		6264

Name: FREIGHT INWARDS Acc No: 520

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Aug	3	Account payable		110
		Ending balance		110

GENERAL LEDGER Name: ACCOUNTANCY FEES Acc No: 600

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit

Name: ADVERTISING EXPENSE Acc No: 605

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Jul	12	Cash at bank	100	1000		Jul	31	Prepaid advertisement	140	600
								P&L ac		400
Aug	1	Prepaid advertisement		600

Name: BANK FEES Acc No: 610

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit

GENERAL LEDGER Name: BORROWING EXPENSES Acc No: 615

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Jul	5	Bank loan	615	500

Name: DEPRECIATION EXPENSE Acc No: 620

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Jul	31	Accumulated depreciation-Shop equipment and fitting	171	132

Name: DISCOUNT ALLOWED Acc No: 625

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Aug	23	Account receivables	625	89
		Ending balance		89

GENERAL LEDGER Name: ELECTRICITY EXPENSE Acc No: 630

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Jul	31	Electricity expenses payable	215	180		Jul	31	P&l		180
Aug	31	Electricity expenses payable	215	180

  Name: INSURANCE EXPENSE Acc No: 635 Name: INTEREST EXPENSEAcc No: 640 GENERAL LEDGERName: MOTOR VEHICLE EXPENSEAcc No: 645 Name: OFFICE SUPPLIES EXPENSEAcc No: 650 Name: RENT EXPENSEAcc No: 655 GENERAL LEDGERName: REPAIRS EXPENSEAcc No: 660 Name: TELEPHONE EXPENSEAcc No: 665 Trial Balanceas at 31 JULY, 2015 GENERAL JOURNAL – Adjusting entries WORKSHEET – ADJUSTING ENTRIES Post-closing Trial Balanceas at 1 August, 2015 GENERAL JOURNAL GENERAL JOURNAL Trial Balanceas at 31 AUGUST, 2015

Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Jul	14	Cash at bank	100	1460		Jul	31	Prepaid insurance	145	1416
								P&l		44
Aug	1	Prepaid insurance		124
Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Jul	31	Interest payable	220	96		Jul	31	P&l		96
Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Jul	07	Cash at bank	100	1980		Jul	31	Prepaid rent	150	990
								P&l A/c		990
		Total		1980				Total		1980
Aug	01	Prepaid rent		990
Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
Date		Details	Post. Ref.	Debit		Date		Details	Post. Ref.	Credit
July	31	Telephone expenses payable	210	55
Aug	25	Cash at bank	100	110
Acc. No.	Account	Balances
		Debit		Credit
100	Cash at bank	36,430
605	Advertising expenses	1,000
635	Insurance expenses	1,460
655	Rent expenses	1,980
170	Shop equipment and fittings	26,130
250	Shareholders loan			5,000
280	Bank loan			50,000
300	Share capital			10,000
400	Service revenue			2,500
615	Borrowing expense	500
		67,500		67,500
Date		Description	Post Ref	Debit		Credit
July	31	Prepaid rent		990
		Rent Expense (rent expenses paid in advance for aug)	655			990
July	31	Prepaid advertising		600
		Advertising expense (3 weeks’ advertising remaining unused)	605			600
July	31	Prepaid insurance		1416
		Insurance expense (insurance paid for the entire year in July, commencing from 21st July )	635			1416
July	31	Telephone expense	665	55
		Telephone payable (telephone bill for 11 days being due)				55
July	31	Electricity expenses	630	180
		Electricity payable (electricity bill due @360 for July and august, to be received in September)	215			180
July	31	Depreciation expense	620	132
		Accumulated depreciation- shop equipment and fittings (depreciation on shop equipment)	171			132
July	31	Interest expense	640	96
		Interest payable (interest charged on bank loan)	220			96
No.	Account	Trial balance		Adjustments		Adjusted trial balance			Statement of profit or loss			Statement of financial position
		Dr	Cr	Dr	Cr		Dr	Cr		Dr	Cr		Dr	Cr
100	Cash at bank	36,430					36,430						36,430
140	Prepaid Advertising			600			600						600
145	Prepaid Insurance			1416			1416						1,416
655	Prepaid Rent			990			990						990
170	Shop equipment and fittings	26,130					26,130						26,130
171	Accumulated depreciation – shop equipment				132			132						132
210	Telephone payable				55			55						55
215	Electricity payable				180			180						180
220	Interest payable				96			96						96
250	Shareholders loan		5,000					5,000						5,000
280	Bank loan		50,000					50,000						50,000
300	Share capital		10,000					10,000						10,000
350	Retained earnings													103
400	Service revenue		2,500					2,500			2,500
605	Advertising expense	1000			600		400			400
615	Borrowing expense	500					500			500
620	Depreciation expense – shop equipment			132			132			132
630	Electricity expense			180			180			180
635	Insurance expense	1460			1416		44			44
640	Interest expense			96			96			96
655	Rent expense	1980			990		990			990
665	Telephone expense			55			55			55
										2397
										Profit	103
		67,500	67,500	3469	3469		67,963	67963					65,566	65,566
Acc. No.	Account	Balances
		Debit		Credit
100	Cash at bank	36,430
140	Prepaid advertising	600
145	Prepaid insurance	1,416
150	Prepaid rent	990
170	Shop equipment and fittings	26,130
171	Accumulated depreciation – shop equipment			132
210	Telephone payable			55
215	Electricity payable			180
220	Interest payable			96
250	Shareholders loan			5,000
280	Bank loan			50,000
300	Share capital			10,000
350	Retained earning			103
		65,566		65,566
Date		Description	Post Ref	Debit		Credit
Aug	01	Rent expenses		990
		Advertisement expenses		600
		Insurance expenses		124
		Prepaid rent				990
		Prepaid advertisement				600
		Prepaid insurance (being expenses for the month booked via reversal entry)				124
Aug	3	Inventory		11,900
		GST paid		1,190
		Freight		110
		Account payable (inventory from Samsung)				13,200
	5	Cash at bank		1,584
		GST collected				144
		Sale revenue (cash sales)				1,440
		Cost of sales		864
		Inventory (Cost of cash sale)				864
	10	Inventory		5,000
		GST paid		500
		Account payable (inventory from Sony)				5,500
	11	Account receivable		3,300
		GST collected				300
		Sale revenue (sale to Clear Vision Opticians)				3,000
		Cost of sales		1,800
		Inventory (Cost of sales to Clear Vision)				1,800
	13	Sale return		300
		GST collected		30
		Account receivable (sale return from Clear Vision)				330
		Inventory		180
		Cost of sales (Cost of sales return)				180
	14	Account payable		5,500
		Discount received				99
		GST paid				11
		Cash at bank (payment to Sony)				5,390
	17	Account receivable		1,980
		GST collected				180
		Sale revenue (sale to ABC Accountants)				1,800
		Cost of sales		1,080
		Inventory (Cost of sales to ABC Accountants)				1,080
Date		Description	Post Ref	Debit		Credit
Aug	18	Bank loan		1,000
		Cash at bank (repay to bank loan)				1,000
	21	Cash at bank		4,950
		GST collected				450
		Sale revenue (cash sale)				4,500
		Cost of sales		2,700
		Inventory (Cost of cash sale)				2,700
	23	Cash at bank		1,881
		GST paid		10
		Discount allowed		89
		Account receivable (payment from ABC Accountants)				1,980
	25	Telephone expense		110
		Telephone payable		55
		Cash at bank (paid telephone bill)				165
	31	Account payable		220
		Inventory				200
		GST paid (return inventory to Samsung)				20
		Electricity expenses		180
		Electricity expenses payable				180
Acc. No.	Account	Balances
		Debit		Credit
100	Cash at bank	1,861
120	Account receivable	2,970
130	Inventory	9,810
155	GST paid	1,730
200	Account payable			12,980
210	Telephone payable	50
260	GST collected			1,105
280	Bank loan	1,000
410	Sales revenue			10,740
420	Sales returns and allowances	300
430	Discount received			110
500	Cost of sale	6,890
520	Freight inward	110
625	Discount allowed	99
665	Telephone expense	115
		24,935		24,935