ACC10008 Financial Information Systems

Topic 5 Special Journals

Solution to revision question

Hoggett, J., Edwards, L., Medlin, J., Chalmers, K., Hellmann, A., Beattie, C. & Maxfield, J.
Financial Accounting 9th ed

Chapter 7

Discussion questions

3. In a system which uses several special journals, it is not necessary to have a general journal.
Do you agree? Explain.
In a system with several special journals, the need for a general journal remains to account for any
unusual transactions or events which cannot be catered for by any of the special journals.
Furthermore, the general journal is required for recording adjusting and closing entries. Different
special journals may be omitted from an entitys accounting system, but the general journal is
always needed. In a sophisticated computerised accounting system, the general journal may be the
only journal needed. Such a general journal will provide a chronological record of all transactions
and events as they affect the entity.

9. Which journal(s) would be used to record the following transactions? The business is registered
for GST.
(a) The introduction of cash and office equipment by the owner on establishment of the business.
(b) The cash payment of rent in advance.
(c) The purchase of inventory on credit.
(d) The purchase of office supplies on credit.
(e) The sale of inventory on credit.
(f) The sale of some pieces of office equipment on credit.
(g) The collection of cash from a customer.
(h) The return of part of the inventory purchased previously on credit from a supplier.
(i) The adjusting entry for rent which is still prepaid at the end of the accounting period.
(j) The adjusting entry for unused office supplies.
(k) The closing entry for expenses at the end of the period.

(a) cash receipts journal for the cash, and the general journal for the office equipment
(b) cash payment journal
(c) purchases journal
(d) general journal; however, if a multipurpose purchases journal exists, as shown in figure 7.6 p.
295, the multipurpose purchases journal would be used
(e) sales journal
(f) general journal
(g) cash receipts journal
(h) general journal, or purchases returns journal if one exists

Page 1 of 31
 (i) general journal
(j) general journal
(k) general journal

10. Since nearly all accounting functions today are computerised, there is really no need for
accountants to have an understanding of manual accounting systems. Do systems designers
need to understand manual accounting systems? Discuss.
Despite the growth in demand for computerised accounting packages being used in business,
there is always demand for students and accountants who have an underlying basic accounting
knowledge. For example, to understand how MYOB, Quick Books and other computerised
packages work, you need to understand the basic workings of a manual accounting system (on
which these computerised programs are modelled). Manual accounting systems studied in
introductory accounting courses form the basis for understanding accounting and the financial
reporting process. For this reason the study of manual systems is paramount to understanding
basic business transactions and the associated practice. As indicated in the chapter, computerised
accounting systems make extensive use of control accounts/subsidiary ledgers, and adapt the
principles underlying special journals.

Exercise 7.5 Matching transaction types with journals

Fiona Spottiswoode uses a purchases journal, a cash payments journal, a sales journal, a cash
receipts journal and a general journal. Indicate in which journals the following transactions are most
likely to be recorded:

1. Issue of shares for cash.

2. Purchased inventories on credit.
3. Cash purchase of inventories (cheque no. 32162).
4. Sale of marketable securities (shares) for cash.
5. Sales of inventory on credit.
6. Received payment of a customers account.
7. Received adjustment note for defective goods, which were purchased on credit and returned to the
supplier.
8. Owner withdrew inventory for personal use.
9. Owner withdrew cash.
10. Payment of monthly rent by cheque.
11. Cash refund to a customer who returned inventory.
12. Year-end closing entries.

1. Cash receipts journal

2. Purchases journal
3. Cash payments journal
4. Cash receipts journal
5. Sales journal
6. Cash receipts journal
7. General journal
8. General journal
9. Cash payments journal
10. Cash payments journal
11. Cash payments journal
12. General journal

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Exercise 7.10 Relating purchases, cash payments and the general journal to the
subsidiary ledger and control account

At 1 February, the following information was extracted from the records of David Hendry (assume no
GST):
Schedule of Accounts Payable
as at 31 January 2016
D. Geelan $ 525
Banks Ltd 5 250
Nguyen Ltd 5 560
$11 335

Extracts from the purchases, cash payments and general journals for February are presented below:
Purchases Journal Page Cash Payments Journal Page 1
1
Date Account Amount
3/2 D. Geelan 520 Chq. Accounts
9/2 Banks Ltd 3 620 Date Account No. Payable
12/2 Peter Ltd 2 430 5/2 Banks Ltd 532 5 100
22/2 G. Harker 2 350 18/2 D. Geelan 533 1 045
28/2 Nguyen Ltd 534 5 260

General Journal Page 1

Date Particulars Debit Credit
17/2 Accounts Payable Control, Nguyen Ltd 180
Purchases Returns and Allowances 180
(Returned goods, adjustment credit note received)

Required

A. Establish running balance ledger accounts for each supplier in the subsidiary ledger and an
Accounts Payable Control account in the general ledger. Post the amounts from the journals to
the subsidiary and control accounts.
B. Prepare a schedule of accounts payable as at 28 February and compare the total with the
balance in the control account.

A.
D. Geelan
Date Post Ref Debit Credit Balance
1/2 525
3/2 PJ1 520 1 045
18/2 CPJ1 1 045 0

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 Banks Ltd
Date Post Ref Debit Credit Balance
1/2 5 250
5/2 CPJ1 5 100 150
9/2 PJ1 3 620 3 770

Nguyen Ltd
Date Post Ref Debit Credit Balance
1/2 5 560
17/2 GJ 180 5 380
28/2 CPJ1 5 260 120

Peter Ltd
Date Post Ref Debit Credit Balance
12/2 PJ1 2 430 2 430

G. Harker
Date Post Ref Debit Credit Balance
22/4 PJ1 2 350 2 350

General Ledger

Account Payable Control A/c

Date Post Ref Debit Credit Balance
1/2 11 335
17/2 GJ1 180 11 155
28/2 PJ1 8 920 20 075
28/2 CPJ1 11 405 8 670

Page 4 of 31
B.

Schedule of Accounts Payable

as at 28 February 2016
D. Geelan
Banks Ltd 3 770
Nguyen Ltd 120
Peter Ltd 2 430
G. Harker 2 350
$8 670

Exercise 7.15 Detecting errors in an accounting system

Alana Szeqczyks accounting system that uses sales, purchases, cash receipts and cash payments
journals and a general journal. At various times during the year, the following errors have occurred.
1. The amount column in the sales journal was incorrectly totalled.
2. The amount of a bank loan entered in the other accounts column of the cash receipts journal
was posted as a debit to bills payable.
3. A credit purchase for $700 was posted as $70 in the accounts payable subsidiary ledger.
4. A purchases return, journalised in the general journal, was posted to the Accounts Payable
Control account and to the Purchases Returns and Allowances account but was not posted to the
accounts payable subsidiary ledger.
5. A subtraction error was made in determining a customers account balance in the accounts
receivable subsidiary ledger.
6. The purchases journal was incorrectly totalled.
7. An error was made in totalling the cash column in the cash payments journal.
8. A sales allowance for goods sold on credit was entered in the general journal. The entry was
posted to only two accounts the accounts receivable subsidiary account and to Sales Returns
and Allowances.
9. A cheque to a supplier, net of the applicable discount received, was correctly entered in the cash
at bank column at the net amount and in the accounts payable column at the gross amount. No
entry was made in the discount received column.
10. Discount allowed was not entered in the cash receipts journal. The amount of the suppliers
invoice was entered in the accounts receivable column and the net amount of the cheque was
entered in the cash at bank column.

Required
Specify a procedure that would detect each error.

1. Compare the balance of the Accounts Receivable Control account with the schedule of accounts
receivable.

2. Prepare a trial balance for the general ledger. Compare the balance of the Accounts Payable
Control account with the schedule of accounts payable.

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3. Prepare a trial balance for the general ledger.

4. Compare the balance of the Accounts Payable Control account with the schedule of accounts
payable.

5. Compare the balance of the Accounts Receivable Control account with the schedule of accounts
receivable.

6. Compare the balance of the Accounts Payable Control account with the schedule of accounts
payable.

7. Cross-add the cash payments journal.

8. Compare the balance of the Accounts Receivable Control account with the schedule of accounts
receivable.

9. Cross-add the cash payments journal.

10. Cross-add the cash receipts journal.

Problem 7.6 Accounting with sales, cash receipts and general journals with GST

Refer to the details and data presented in problem 7.5, and assume further that Galluzo Ltd and its
suppliers are registered for the GST. The following additional accounts are in the general ledger and
appear in the trial balance 2-2300 GST Receivable and 1-1300 GST Payable. Assume both
accounts had a zero opening balance.

Required
A. Record the June transactions in the appropriate journals. Make all postings to the appropriate
general ledger accounts and to the accounts receivable subsidiary ledgers.
B. Reconcile the subsidiary ledger with the Accounts Receivable Control account in the general
ledger.

A.

Sales Journal
p. 1.

Date Inv. Account Terms Post Sales GST Payable Accounts

No. Ref. Receivable
2016
2/6 671 A Guthrie 1 930 193 2 123
7/6 672 G Lindvelt 270 27 297
10/6 673 C Haigh 430 43 473
26/6 674 E Katsambit 540 54 594
3 170 317 3 487
(4-4100) (1-1300) (1-1200)

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 Cash Receipts Journal
p. 1.

Debits Credits
Date Account Post Cash at Disc. GST Sales GST A/cs. Other
Ref. Bank Alld Rec. Pay. Recabl A/cs.
e
2016
8/6 E Katsambit 750 750
12/6 K Coldwell 1 792 1 792
14/6 A Guthrie 2 123 2 123
20/6 Bills Pay. 2 200 20 000 20 000
20/6 Cash Sales 325 295 30
23/6 Market Sec. 1 150 12 000 12 000
25/6 C Haigh 4 410 4 410
30/6 E Katsambit 594 594
41 994 295 30 9 669 32 000
(1-1100) (5-5200) (1-3000) (4-4100) (1-1300 (1-1200) (x)

General Journal

Date Description Post Ref. Debit Credit

4/6 Sales Returns & Allowances 4-4150 180
GST Payable 1 1300 18
Accts. Recble Control K Coldwell 1-1200/ 198
Return of defective goods.

24/6 Bills Receivable 1-1300 3 613

Accts Recble Control G Lintvelt 1-1200/ 3 613
Receipt of promissory note.

General Ledger

Cash at Bank 1-1100

1/6 Balance 17 950
30/6 CRJ1 41 994
59 944

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 Marketable Securities 1-1150
1/6 Balance 30 485 21/6 CRJ1 12 000
Balance 18 485
30 485 30 485
18 485

Accounts Receivable Control 1-1200

1/6 Balance 13 220 4/6 GJ1 198
30/6 SJ1 3 487 24/6 GJ1 3 613
30/6 CRJ1 9 669
30/6 Balance c/d 3 227
16 707 16 707
30/6 Balance b/d 3 227

Bills Receivable 1-1300

24/6 GJ1 3 613

Bills Payable 2-2200

1/6 Balance 2 400
17/6 CRJ1 20 000
22 400

GST Receivable 2-2300

GST Payable 1-1300

4/6 GJ1 18 30/6 CR1 30
30/6 Balance 329 30/6 SJ1 317
347 347

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 Balance 329

Sales 4-4100
1/6 Balance 207 030
30/6 SJ1 3 170
30/6 CRJ1 295
210 495

Sales Returns and Allowances 4-4150

1/6 Balance 2 572
4/6 GJ1 180
2 752

Dividend Revenue 4-4200

1/6 Balance 1 005

Interest Revenue 4-4300

1/6 Balance 905

Gain on Sale of Marketable Securities 4-4400

1/6 Balance 280

Discount Allowed 5-5200

1/6 Balance 1 930
30/6 CRJ1 0
1 930

Accounts Receivable Subsidiary Ledger

Page 9 of 31
 A. Guthrie
Date Post Ref Debit Credit Balance
2/6 SJ1 2 123 2 123
14/6 CRJ1 2 123

C. Haigh
Date Post Ref Debit Credit Balance
31/5 3 980
10/6 SJ1 473 4 453
25/6 CRJ1 4410 43

E. Katsambit
Date Post Ref Debit Credit Balance
31/5 750
4/6 CR1 750
26/6 SJ1 594 594
30/6 CR1 594

G. Lintvelt
Date Post Ref Debit Credit Balance
31/5 3 316
7/6 SJ1 297 3 613
25/6 GJ1 3 613

I. Dowden
Date Post Ref Debit Credit Balance
31/5 3 184

K. Coldwell
Date Post Ref Debit Credit Balance
31/5 1 990
4/6 GJ1 198 1 792
12/6 CR1 1 792

B.

Page 10 of 31
 Schedule of Accounts Receivable

as at 30 June 2016

A. Guthrie $

C. Haigh 43

E. Katsambit

G. Lintvelt

I. Dowden 3 184

K. Coldwell

Total $3 227

Page 11 of 31
Problem 7.8 Journalising transactions, posting and preparation of a
trial balance without/with GST

Zhang Ltd uses sales, purchases, cash receipts, cash payments and a general journal along with
subsidiary ledgers for accounts receivable and accounts payable. Zhang Ltds financial year ends on
31 December 2016. The post-closing trial balance as at 30 June 2016 and schedules of balances of
the subsidiary ledgers are presented below.

ZHANG LTD
Post-closing Trial Balance
as at 30 June 2016
1-100 Cash at bank $ 26 680
1-110 Accounts receivable control 15 440
1-150 Inventory 25 280
1-170 Office equipment 53 000
1-175 Accumulated depreciation office equipment $ 7 800
2-200 Accounts payable control 20 590
3-300 Share capital 60 000
3-350 Retained earnings 32 010
4-400 Sales
4-405 Sales returns
4-410 Discount received
5-500 Purchases
5-505 Purchases returns
5-512 Discount allowed
5-530 Rent expense
5-540 Sundry expenses
5-550 Commissions expense
$120 400 $120 400

Schedule of Accounts Receivable

as at 30 June 2016
Moorman Ltd $3 600
Lo Ltd 7 210
North Ltd 4 630
$15 440

Schedule of Accounts Payable

as at 30 June 2016
Higgins Ltd $7 200
G. McClure 5 150
Ventura Ltd 8 240
$20 590

The following transactions occurred in July 2016:

July 1 Received a cheque from Moorman Ltd for payment on account, $3600.
2 Paid rent for July, $3700, by interbank transaction to Buildings Ltd.
3 Sold inventory to Kemp Ltd on credit, invoice 342, $4200, terms 2/10, n/30.
5 Purchased inventory on credit from F. Falla, $4900, invoice 243,
terms 2/10, n/30.
7 Paid G. McClure for inventory purchased previously (no discount), $5150, by

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 interbank transfer.
Received payment from Kemp Ltd for full settlement of invoice 342.
10 Received an adjustment note from F. Falla for inventory returned, $200.
11 Paid F. Falla in full for invoice 243 by interbank transfer.
12 Paid sales commissions, $9580, by interbank transfer.

15 Received a cheque from Lo Ltd in part payment of the account, $3600, no discount
applicable.
16 Paid $14 000 for new office equipment, cheque no. 304.
18 Cash sales, $2620.
19 Sold inventory on credit to Moorman Ltd, $4430, invoice 343, terms 2/10, n/30.
20 Sold inventory on credit to C. Gable, $2200, invoice 344, terms 2/10, n/30.
24 Paid Ventura Ltd for inventory purchased in May, $8240, cheque no. 305.
25 Cash sales, $2800.
26 Issued cheque no. 306 to pay sundry expenses, $1280.
30 North Ltd directly credited Zhangs bank account for $4630, for payment of account.
30 Received a cheque from C. Gable in payment of invoice 344.

Required

A. 1. Journalise the transactions in the appropriate journals.

2. Make all necessary postings for the month.
3. Prepare a trial balance of the general ledger as at 31 July 2016, and reconcile subsidiary
ledgers with their control accounts.
B. Rework requirements A.1, A.2 and A.3 assuming that recording of GST is required. Add 1-800 GST
Receivable and 2-250 GST Payable to the post-closing trial balance (assume both accounts have
zero balances). Round amounts to the nearest dollar. Sales commissions do not incur GST.

B. (with GST)

1.

General Journal
p. 1.

Date Account Post Ref. Debit Credit

2016
10/7 Accounts Payable Control
F Falla 2-200/ 220
Purchases Returns 5-505 200
GST Receivable 1-800 20
To record purchases
returns.

Page 13 of 31
 Purchases Journal
p. 1.

Date Date Account Terms Post Purchases GST Accounts

of Ref. Receivabl Payable
Inv. e
2016
5/7 5/7 F Falla 2/10, n/30 4 900 490 5 390
$4 900 $490 $5 390
(5-500) (1-800) (2-200)

Sales Journal
p. 1.

Date Inv. Account Terms Post Sales GST Accounts

No. Ref. Payable Receivable
2016
3/7 620 Kemp Ltd 2/10, n/30 4 200 420 4 620
19/7 621 Moorman Ltd 2/10, n/30 4 430 443 4 873
20/7 622 C Gable 2/10, n/30 2 200 220 2 420
$10 830 $1 083 $11 913
(4-400) (2-250) (1-110)

Page 14 of 31
 Cash Receipts Journal

p. 1.

Debits Credits
Dat Account Post Cash at Disc. GST Sales GST A/cs. Other
e Ref. Bank Alld Payabl Rec. Recabl A/cs.
e e
201
6
1/7 Moorman 3 600 3 600
Ltd
7/7 Kemp Ltd 4 528 84 8 4 620
15/7 Lo Ltd 3 600 3 600
18/7 Cash Sales 2 882 2 620 262
25/7 Cash Sales 3 080 2 800 280
30/7 North Ltd 4 630 4 630
30/7 C Gable 2 372 44 4 2 420
$24 692 $128 $12 $5 420 $542 $18 870 -
(1-100) (5-512) (2-250) (4-400) (2-250) (1-110) (x)

Cash Payments Journal

p. 1.

Dat Account Ch. Post. Other Acc/s Purchas GST Cash at Disc. GST
e No. Ref. Payabl es Receiv Bank Recd Receivab
e able le
201
6
2/7 Rent BPay 5-530 3 700 370 4 070
7/7 G McClure BPay 5 150 5 150
11/7 F Falla BPay 5 170 5 067 94 9
12/7 Comm. Exp. Trf 5-550 9 580 9 580
16/7 Office Equip. 304 1-170 14 000 1 400 15 400
24/7 Ventura Ltd 305 8 240 8 240
26/7 Sundry Exp. 306 5-540 1 280 128 1 408
$28 $18 $1 898 $48 915 $94 $9
560 560
(x) (2-200) (1-800) (1-100) (4-410) (1-800)

Page 15 of 31
2.

General Ledger

Cash at Bank 1-100

30/6 Balance 26 680 31/7 CP1 48 915
31/7 CR1 24 692

Accounts Receivable Control 1-110

30/6 Balance 15 440 31/7 CR1 18 870
3/7 S1 11 913

Inventory 1-150
30/6 Balance 25 280

Office Equipment 1-170

30/6 Balance 53 000
16/7 CP1 14 000

Accum. Depreciation Office Equipment 1-175

30/6 Balance 7 800
/

GST Receivable 1-800

31/7 PJ1 490 10/7 GJ1 20
31/7 CP1 1 898 31/7 CP1 9
31/7 CR1 542

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 Accounts Payable Control 2-200
10/7 GJ1 220 30/6 Balance 20 590
31/7 CP1 18 560 31/7 P1 5 390

GST Payable 2-250

31/7 CR1 12 31/7 SJ1 1 083
31/7 CR1

Share Capital 3-300

30/6 Balance 60 000

Retained Earnings 3-350

30/6 Balance 32 010

Sales 4-400
31/7 CR1 5 420
31/7 S1 10 830

Sales Returns 4-405

Discount Received 4-410

31/7 CP1 94

Page 17 of 31
 Purchases 5-500
31/7 P1 4 900

Purchases Returns 5-505

10/7 GJ1 200

Discount Allowed 5-512

31/7 CR1 128

Rent Expense 5-530

31/7 CP1 3 700

Sundry Expenses 5-540

26/7 CP1 1 280

Commission Expense 5-550

12/7 CP1 9 580

Accounts Receivable Subsidiary Ledger

Kemp Ltd
Date Post Ref Debit Credit Balance
4/7 S1 4 620 4 620
8/7 CR1 4 620 -

C Gable
Date Post Ref Debit Credit Balance
20/7 S1 2 420 2 420
30/7 CR1 2 420 -

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 Lo Ltd
Date Post Ref Debit Credit Balance
30/4 7 210
15/5 CR1 3 600 3 610

Moorman Ltd
Date Post Ref Debit Credit Balance
30/6 3 600
1/7 CR1 3 600 -
19/7 S1 4 873 4 873

North Ltd
Date Post Ref Debit Credit Balance
30/6 S1 4 630
30/7 4 630 -

Accounts Payable Subsidiary Ledger

F Falla
Date Post Ref Debit Credit Balance
5/7 P1 5 390 5 390
10/7 GJ1 220 5 170
11/7 CP1 5 170 -

Higgins Ltd
Date Post Ref Debit Credit Balance
30/6 7 200

G McClure
Date Post Ref Debit Credit Balance
30/6 5 150
7/7 CP1 5 150 -

Page 19 of 31
 Ventura Ltd
Date Post Ref Debit Credit Balance
30/4 8 240
24/5 CP1 8 240 -

3.

Subsidiary Ledgers

Schedule of Accounts Receivable

as at 31 July 2016
Moorman Ltd $4 873
Lo Ltd 3 610
$8 483

Schedule of Accounts Payable

as at 31 July 2016
Higgins Ltd $7 200

$7 200

Page 20 of 31
 ZHANG LTD
Trial Balance
as at 31 July 2016
Account Dr Cr
Cash at bank 1-100 $2 457
Accounts receivable 1-110 8 483
Inventory 1-150 25 280
Office equipment 1-170 67 000
Accum. depr. office equipment 1-175 7 800
GST Receivable 1-800 1 817
Accounts payable control 2-200 7 200
GST Payable 2-250 1 071
Share capital 3-300 60 000
Retained earnings 3-350 32 010
Sales 4-400 16 250
Discount received 4-410 94
Purchases 5-500 4 900
Purchases returns 5-505 200
Discount allowed 5-512 128
Rent expense 5-530 3 700
Sundry expenses 5-540 1 280
Commission expense 5-550 9 580
124 625 124 625

Page 21 of 31
Problem 7.15 Comprehensive problem (including GST)

The post-closing trial balance of Raschella Ltd as at 1 November 2016 contained the following
normal balances:

Account no. Account title Account balance

1100 Cash at Bank $ 60 000
1120 Accounts Receivable 7 270
1130 Bills Receivable 750
1140 Inventory 80 000
1150 Prepaid Insurance
1160 GST Receivable 2 000
1210 Delivery Vehicle 40 000
1215 Accumulated Depreciation Delivery Vehicle 4 000
1220 Office Equipment 24 000
1225 Accumulated Depreciation Office Equipment 4 000
2110 Accounts Payable 5 780
2120 Bills Payable
2150 GST Payable 3 500
3110 Share Capital 192 000
3120 Retained Earnings 4 740
4110 Sales
4115 Sales Returns and Allowances
4120 Discount Received
5110 Purchases
5115 Purchases Returns and Allowances
5120 Discount Allowed
5130 Rent Expense
5140 Electricity Expense
5150 Salaries Expense

Subsidiary ledger balances at 31 October 2016 were:

Accounts Receivable
Customer Date of sale Terms Amount
M. Peterson 28 October 2/10, n/30 $2100
N. Mobius 30 October 2/10, n/30 2310
D. Temby 18 October 2/10, n/30 2860

Accounts Payable
Creditor Date of purchase Terms Amount
Warnes Ltd 19 October 1/30, n/60 $1640
B. Lau 10 October n/30 2650
Gent Ltd 23 October 1/15, n/30 1490

Transactions for the month of November 2016 were:

Nov. 1 Bought inventory from B. Lau on credit, $2400 plus GST; terms n/30.
Purchased 1 years insurance cover for $900 plus GST, cheque no. 400.
3 Inventory sold to N. Mobius last month was returned. Issued an adjustment note for

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 the amount of $110 (including GST).
Received a cheque from M. Peterson to cover the sale made on 28 October.
4 Paid Gent Ltd cheque no. 401 for purchase of 23 October.
Purchased inventory from Warnes Ltd on credit, $2400 plus GST;
terms 1/10, n/60.
5 Issued cheque no. 402 for $1650 to B. Lau on account, and issued
a 60-day 10% bill payable for the balance due on the purchase of 10 October.
8 Paid November rent of premises $540 plus GST, cheque no. 403.
Paid Warnes Ltd for the purchase of 19 October, cheque no. 404.
10 Sold inventory on account to M. Menz, $4500 plus GST; terms 2/10, n/30.
Received cash for the issue of additional share capital, $30 000
(GST-free).
11 Received cheque for $1430 from D. Temby in part payment of the sale made on
18 October, together with a bill receivable for the balance due.
12 Sold merchandise to M. Peterson on account, $4800 plus GST; terms 2/10, n/30.
13 Purchased goods on credit from Gent Ltd, $3960; terms 1/15, n/30 (including GST).
14 Paid fortnightly salaries by cheque no. 405, $1200.
Cash sales from 1 November to 14 November, $9200 plus GST.
18 Sold goods to D. Temby on account, $4650 plus GST; terms 2/10, n/30.
Received an adjustment note from Gent Ltd for $77 for defective goods returned
(includes GST).
19 Forwarded cheque no. 406 to ATO to cover GST owing from previous month,
$1500.
20 M. Menz forwarded a cheque for $1320 on account; no discount was allowed.
Purchased goods for cash. Issued cheque no. 407 for $5400 plus GST.
21 Received a cheque from M. Peterson for $660 and a promissory note (bill receivable)
for the balance of his account; no discount was allowed.
26 D. Temby forwarded a cheque for the goods sold on 18 November.
27 Paid Gent Ltd for the purchase made on 13 November, cheque no. 408.
28 Paid fortnightly salaries with cheque no. 409, $1200 (GST-free).
30 Electricity account paid by cheque no. 410, $210 plus GST.
Cash sales from 15 November to 30 November, $9000 plus GST.
Purchased inventory on credit from Gent Ltd, $3630; terms 1/15, n/30 (includes
GST).

Required
A. Record the November transactions (round amounts to the nearest dollar) in appropriate special
journals and the general journal.
B. Open running balance accounts in the subsidiary ledgers and their control accounts in the general
ledger, and enter the opening details of these accounts.
C. Post relevant data from the journals to the appropriate running balance subsidiary ledger
accounts.
D. Prepare schedules of accounts receivable and accounts payable as at 30 November 2016, and
reconcile to the appropriate subsidiary ledger control accounts in the general ledger.
E. Prepare the GST Payable and GST Receivable accounts as they would appear at 30 November
2016.

Page 23 of 31
A.
Purchases Journal
p. 1.

Date Date Account Terms Post Purchases GST Accounts

of Ref. Receivabl Payable
Inv. e
2016
1/11 B. Lau n/30 2 400 240 2 640
4/11 Warnes Ltd 1/10, 2 400 240 2 640
n/60
13/1 Gent Ltd 1/15, 3 600 360 3 960
1 n/30
30/1 Gent Ltd 1/15, 3 300 330 3 630
1 n/30
$11 700 $1 170 $12 870
(5110) (1160) (2110)

Sales Journal
p. 1.

Date Inv. Account Terms Post Sales GST Accounts

No. Ref. Payable Receivable
2016
10/1 M. Menz 2/10, n/30 4 500 450 4 950
1
12/1 M. Peterson 2/10, n/30 4 800 480 5 280
1
18/1 D. Temby 2/10, n/30 4 650 465 5 115
1
$13 950 $1 395 $15 345
(4110) (2150) (1120)

Page 24 of 31
 Cash Payments Journal

p. 1.

Date Account Ch. Post. Other A/cs. Purchas GST Cash at Dis. GST
No. Ref. Payabl es Receiv Bank Recd Receiv
e able able
2016
3/11 Prepaid Ins. 400 1150 900 90 990
4/11 Gent Ltd 401 1 490 1 476 13 1
5/11 B. Lau 402 1 650 1 650
8/11 Rent Exp. 403 5130 540 54 594
8/11 Warnes Ltd 404 1 640 1 624 15 1
14/11 Salaries Exp. 405 5150 1200 1 200
19/11 ATO (GST 406 2150 1 500 1 500
Payable
20/11 Cash Pur. 407 5 400 540 5 940
27/11 Gent Ltd 408 3 883 3 844 35 4
28/11 Salaries Exp. 409 5150 1 200 1 200
30/11 Elect. Exp. 410 5140 210 21 231
$5 550 $8 663 $5 400 $705 $20 249 $63 $6
(x) (2110) (5110) (1160) (1100) (4120) (1160)

Page 25 of 31
 Cash Receipts Journal

p. 1.

Debits Credits
Date Account Post Cash at Dis. GST Sales GST A/cs. Other
Ref. Bank Alld Payab Payabl Recabl A/cs.
le e e
2016
3/11 M. 2 058 38 4 2 100
Peterson
10/11 Share Cap. 3110 30 000 30 000
11/11 D. Temby 1 430 1 430
14/11 Cash Sales 10 120 9 200 920
20/11 M. Menz 1 320 1 320
21/11 M. 660 660
Peterson
26/11 D. Temby 5 013 93 9 5 115
30/11 Cash Sales 9 900 9 000 900
$60 501 $131 $13 $18 200 $1 820 $10 625 $30 000
(1100) (5120) (2150) (4110) (2150) (1120) (x)

Page 26 of 31
 General Journal

Date Description Post Debit Credit

Ref.
2016
3/11 Sales Returns and Allowances 4115 100
GST Payable 2150 10
Accounts Receivable N. Mobius 1120/ 110
Return of goods from N. Mobius

5/11 Accounts Payable B. Lau 2110/ 1 000

Bills Payable 2120 1 000
Bills sent in part payment.

11/11 Bills Receivable 1130 1 430

Accounts Receivable T Trimble 1120/ 1 430
Promissory note received from T Trimble.

19/11 GST Payable 2150 2 000

GST Receivable 1160 2 000
Transfer GST Receivable from October to
GST Payable.

18/11 Accounts Payable Gent Ltd 2110/ 77

Purchases Returns & Allowances 5115 70
GST Receivable 1160 7
Returned goods to Gent Ltd.

21/11 Bills Receivable M. Peterson 1130 4 620

Accounts Receivable 1120/ 4 620
Promissory note received from M.
Peterson.

Page 27 of 31
B. and C.

Accounts Receivable Subsidiary Ledger

M. Menz
Date Post Ref Debit Credit Balance
2016
10/11 SJ1 4 950 4 950
20/11 CRJ1 1 320 3 630

M. Peterson
Date Post Ref Debit Credit Balance
2016
31/10 2 100
3/11 CRJ1 2 100
13/11 SJ1 5 280 5 280
21/11 CRJ1 660 4 620
21/11 GJ1 4 620

T Trimble
Date Post Ref Debit Credit Balance
2016
31/10 2 860
11/11 CRJ1 1 430 1 430
11/11 GJ1 1 430
18/11 SJ1 5 115 5 115
26/11 CRJ1 5 115

N. Mobius
Date Post Ref Debit Credit Balance
2016
31/10 2 310
3/11 GJ1 110 2 200

Page 28 of 31
 Accounts Payable Subsidiary Ledger

Warnes Ltd
Date Post Ref Debit Credit Balance
2016
31/10 1 640
4/11 PJ1 2 640 4 280
9/11 CPJ1 1 640 2 640

Gent Ltd
Date Post Ref Debit Credit Balance
2016
31/10 1 490
4/11 CPJ1 1 490
13/11 PJ1 3 960 3 960
19/11 GJ1 77 3 883
27/11 CPJ1 3 883
30/11 PJ1 3 630 3 630

B. Lau
Date Post Ref Debit Credit Balance
2016
31/10 2 650
1/11 PJ1 2 640 5 290
5/11 CPJ1 1 650 3 640
5/11 GJ1 1000 2 640

Accounts Receivable 1120

Date Post Ref Debit Credit Balance
2016
1/9 7 270
2/11 GJ1 110 7 160
11/11 GJ1 1 430 5 730
21/11 GJ1 4 620 1 110
30/11 S1 15 345 16 455
30/11 CR1 10 625 5 830

Page 29 of 31
 Accounts Payable 2110
Date Post Ref Debit Credit Balance
2016
1/11 5 780
5/11 GJ1 1 000 4 780
18/11 GJ1 77 4 703
30/11 PJ1 12 870 17 969
30/11 CP1 8 663 8 910

D.

Subsidiary Ledgers

Schedule of Accounts Receivable Schedule of Accounts Payable

as at 30 November 2016 as at 30 November 2016
M. Menz 3 630 Warnes Ltd $2 640
N. Mobius $2 200 Gent Ltd 3 630
M. Merlin 2 640
$5 830 $8 910

E.

GST Receivable 1160

Date Post Ref Debit Credit Balance
2016
1/11 2 000
19/11 GJ1 7 1 993
19/11 GJ1 2 000 (7)
30/11 PJ1 1 170 1 163
30/11 CPJ1 705 1 868
30/11 CPJ1 6 1 862

Page 30 of 31
 GST Payable 2150
Date Post Ref Debit Credit Balance
2016
1/11 3 500
3/11 GJ1 10 3 490
19/11 GJ1 2 000 1 490
19/11 CPJ1 1 500 (10)
30/11 CRJ1 1 820 1 810
30/11 CRJ1 13 1 797
30/11 SJ1 1 395 3 192

Page 31 of 31