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Q5. Record the following transactions in the three-column Cash Book of Sweetie Pie Enterprises for January...

Q5. Record the following transactions in the three-column Cash Book of Sweetie Pie Enterprises for January 2019.

Jan 1 Balances in Cash Book: Cash GH¢500 and Bank (Credit balance) GH¢2,000

       2 Invested additional capital of GH¢12,000 cash

       5 Deposited GH¢8,000 in the bank

      8 Received from Ramatu GH¢890 after allowing her a discount of GH¢5

     12 Paid GH¢1200 to Ghartey after allowing Sweetie Pie a discount of GH¢30

     15 Bought goods for cash worth GH¢700

     17 Sold goods for cash for GH¢1,000

     18 Purchased furniture by cheque for GH¢1,500

     19 Receive a cheque of GH¢230 from Naa Sarkor in full payment of her debt of      GH¢240

    22 Paid commission of GH¢150 by cheque

    25 Withdrew GH¢300 for personal use

    26 Paid to Kwaw GH¢700 by cheque; discount received is GH¢20

    27 Withdrew GH¢300 for personal use

    29 Received dividend by cheque for GH¢30 and deposited in the bank on the same day

    30 Paid telephone bill of GH¢50

    31 Paid manager’s salary of GH¢350, rent GH¢200 and wages of staff GH¢150

Solutions

Expert Solution

Dr.(Receipts) THREE COLUMN CASH BOOK OF SWEETIE PIE (Currency - GH¢) (Cr. Payments)
Date Description V No PR Discount Cash Bank Date Description V No PR Discount Cash Bank
2019 2019
Jan 1 Balance b/d            -                   500                -   Jan 1 Balance b/d           -                 -           2,000
Jan 2 Capital             12,000 Jan 5 Bank           8,000
Jan 5 Cash           8,000 Jan 8 Ramatu             5
Jan 8 Ramatu                     890 Jan 12 Ghartey           1,200
Jan 12 Ghartey           30 Jan 15 Purchases             700
Jan 17 Sales               1,000 Jan 18 Furniture         1,500
Jan 19 Naa Sarkor              230 Jan 19 Naa Sarkor           10
Jan 26 Kwaw           20 Jan 22 Commission           150
Jan 29 Dividend                30 Jan 25 Drawings             300
Jan 26 Kwaw           700
Jan 27 Drawings             300
Jan 30 Telephone bill               50
Jan 31 Managers Salary             350
Jan 31 Rent             200
Jan 31 Wages to staff             150
Jan 31 Balance c/d Jan 31 Balance c/d           3,140         3,910
Total           50           14,390          8,260 Total           15        14,390        8,260
Feb-01 Balance b/d             3,140          3,910

Note:-

1. Assumed - this transaction on Jan 12 Paid GH¢1200 to Ghartey after allowing Sweetie Pie a discount of GH¢30 is cash based one, where payment is treated as cash payment.

If it is bank payment the amount of GH¢ 1200 will be reduced from bank and Closing bank balance will be 3910-1200= GH¢ 2710.

2. Assumed - the transaction on Jan 25 and Jan 27 Withdrew GH¢300 for personal use is withdrawn from cash. Hence it is shown as cash payment.

If it is bank payment the amount of GH¢ 300+300=600 will be reduced from bank and Closing bank balance will be 3910-1200= GH¢ 2710-600= GH¢ 2110.

ekkarill92 answered 2 years ago
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