Escolar Documentos
Profissional Documentos
Cultura Documentos
one approach
Gabrielle Moran
11th September 2010
Double Entry
Two
Matching
Double Entry
Accounts
Asset
Purpose
Record what the firm owns and what is owed to the firm.
e.g. Vans A/C, Premises A/C, Cash A/C, Debtors A/C
Credit
Asset
Asset
Liability
Liability
Expense
Expense
Revenue
Revenue
Debit (Increase)
Credit (Decrease)
Debit (Decrease)
Credit (Increase)
Debit (Increase)
Paying an expense
Increasing the amount previously recorded
Credit (Decrease)
Debit (Decrease)
Credit (Increase)
Asset A/C
Liability A/C
Expense A/C
Revenue A/C
4 Questions to ask
Thus with every transaction you come across you
need to decide:
1.
2.
3.
4.
Double Entry
Assets
1400 Sales
17750
Purchases
10400 P Returns
700
S Returns
400
Wages
650
Balance c/d
6200
18550
18550
Balance b/d
6220
Trial
Balance
Vertical
Approach
Subsidiary Books
Source
documents
List
Reduce
Smith A/C
Purchases /C
A
Smith
Adams
2500
3400
Cranford
Murphy
Smith
Cranford
5640
4260
4700
2600
Purchases 2500
Purchases 4700
Adams A/C
Purchases 3400
Cranford A/C
Purchases 5640
Purchases 2600
Murphy A/C
Purchases 4260
Purchases Book
Date
Details
Smith
Adams
Cranford
Murphy
Smith
Cranford
Inv No
Amount
2500
3400
5640
4260
4700
2600
23100
Smith A/C
Purchases A/C
Creditors 23100
Purchases 2500
Purchases 4700
Adams A/C
Purchases 3400
1 Debit
matching
6 Credits
Cranford A/C
Purchases 5640
Purchases 2600
Murphy A/C
Purchases 4260
Recording Transactions
Stage 1
Stage 2
Stage 3
Stage 4
Source Documents
Subsidiary Books
Ledger
Double Entry
Final Accounts
Balance Sheet
Invoices
[credit purchases and
sales]
Sales Book
Purchases Book
Credit Notes
Cheque Payments
Receipts
Anything Else
General Journal
Post these
transactions
using
Double Entry
Rules
Transfer
from the
Ledger to
ascertain
Profit for
the Year and
the Net
Worth of the
Company at
a point in
time
Sequence
Prepayments
& Accruals
Bad Debts Provision
Simple Incomplete ord level
Control Accounts Subsidiary Books
Depreciation and Disposal
Bank Reconciliations
Final Accounts ord level building
adjustments
Adjustments
Use Dr Cr grid
Dr
Cr
A
L
E
R
A
L
E
R
Buildings at cost
902,000
190,000
Discount (Net)
10,800
17,200
75,200
5,000
320,000
24,800
1,320,000 1,760,000
48,000
3,200
100,400
Bank
Salaries and general expenses
86,600
44,000
199,600
8% Debentures
180,000
800,000
400,000
Directors fees
48,000
Rent
19,600
14,800
3,284,600 3,284,600
6400
24800 P & L
7200
7200
Bal c/d
21600
(24800 + 7200) / 5
= 6400
320,000 X 9% = 28,800
28,800 X =7200
Purchases a/c
Bal b/d
46000
Fire (5)
12000
Buildings (5)
51000
Buildings at cost
902,000
190,000
Discount (Net)
10,800
17,200
75,200
5,000
320,000
24,800
1,320,000 1,760,000
Buildings at cost
902,000
190,000
Discount (Net)
10,800
17,200
75,200
5,000
320,000
24,800
1,320,000 1,760,000
Buildings at cost
902,000
190,000
Discount (Net)
10,800
17,200
75,200
5,000
320,000
24,800
1,320,000 1,760,000
48,000
3,200
100,400
Bank
Salaries and general expenses
86,600
44,000
199,600
8% Debentures
180,000
800,000
400,000
Directors fees
48,000
Rent
19,600
14,800
3,284,600 3,284,600
6400
24800 P & L
7200
7200
Bal c/d
21600
(24800 + 7200) / 5
= 6400
320,000 X 9% = 28,800
28,800 X =7200
Purchases a/c
Bal b/d
46000
Fire (5)
12000
Buildings (5)
51000
Trading
1320000
1211000
1320000
Exam Approach
Read
Template Accounts
Template Trading Profit and Loss a.doc
Exam Approach
Prepare
Enter
Template Accounts
Exam Approach
Prepare
Template Accounts
Enter figures from workings in appropriate place
to P & L
to Bal St
Enter
Exam Approach
Prepare
Template Accounts
Enter figures from workings in appropriate place
to P & L
to Bal St
Enter