Question

In: Accounting

A. Tim commenced business on 1st June 2016 with the following transactions: June 1          Put $20000...

A. Tim commenced business on 1st June 2016 with the following transactions:

June 1          Put $20000 into the bank.

June 3          Purchased Office Furniture on credit from TFP Ltd for $3000.

June 4          Purchased goods for resale from John for $8000 less trade discount of 20%.

June 8          Returned goods to John worth $500 before trade discount.

June 10        Paid John the amount owing after deducting cash discount received of 3%.

June 15        Sold goods on credit to Robin for $12000.

June 17        Robin returned goods worth $2000.

June 19        Robin paid the amount owing by cheque after deducting 3% cash discount allowed.

June 30        Paid TFP Ltd by cheque $1500.

Required:

  1. Prepare ledger accounts for Tim to record the above transactions and balance all accounts as at 30th June 2016.
  2. Prepare a Trial Balance as at 30th June 2016 for Tim.

B. Discuss the implications of the double entry principle in book-keeping and evaluate on how it is an application of the duality concept.

Word limits: 1000 words   

C. Discuss on the importance and relevance of source documents in records keeping and how they contribute to accuracy and completeness of financial records.

Word limits: 1000 words    

Solutions

Expert Solution

the solution is as follows

here trade discount should not be taken and it is not projected in any financial statements hence it is not considared here.

thank you....

ekkarill92 answered 2 years ago
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