Question

Question 2
The following opening balances were extracted from the books of Corn Shop on 1 Feb 2017:
Debit Credit
N$ N$
Non-Current Assets 98 550
Receivables 11 200
Bank 7 250
Payables 7 130
Electricity Due 940
Capital 94 430
109 750 109 750
The following transaction took place for the month of February 2017:
 Feb, 2 Purchased goods on credit at a cost of N$7 200.
 Feb, 5 Sold goods on credit for N$6 000.
 Feb, 7 Receivables paid N$4 500 by cheque. The payment was after a 10% discount
had been allowed;
 Feb, 14 Purchased goods at a cost of N$5 000, paid for these by cheque;
 Feb, 19 Payables of N$6 000 were paid by cheque. An additional discount of 5% was
received due to the prompt payment;
 Feb, 21 The outstanding balance of 1 200, owed on electricity was paid by cheque;
 Feb, 24 Sold goods for cash for N$2 200;
 Feb, 27 Paid wages and salaries of N$700 by cheque;
 Feb, 28 Purchased non-current asset of N$4 000, by cheque.
You are required to:
a) Prepare the necessary journal entries for the above transactions.
b) Post the journal entries in (a) above to the relevant general ledger (T accounts) and
balance the ledger accounts as at 28 Feb 2017.
c) Extract the trial balance as at 28 Feb 2017.

Answer 1

Journal Entries
2-Feb	Purchase A/c Dr	7200
	To Payables		7200
5-Feb	Receivables A/c Dr	6000
	To Sales A/c		6000
7-Feb	Bank A/c Dr	4500
	Discount Allowed A/c Dr	500
	To Receivables A/c		5000
14-Feb	Purchase A/c Dr	5000
	To Bank A/c		5000
19-Feb	Payable A/c Dr	6000
	To Bank A/c		5700
	TO Discount Received A/c		300
21-Feb	Electricity Dues A/c Dr	940
	Electricity Expenses A/c Dr	260
	To Bank A/c		1200
24-Feb	Cash A/c Dr	2200
	To Sales A/c		2200
27-Feb	Salary and Wages A/c Dr	700
	To Bank A/c		700
28-Feb	Non Current Assets A/c Dr	4000
	To Bank A/c		4000
Trail Balance
Particular			Debit	Credit
Non current Assets			102550
Receivables			12200
Cash			2200
Bank				19350
Payables				8330
Electricity Dues
Capital				94430
Purchase			12200
Sales				8200
Discount Allowed			500
Discount Recived				300
Salary and wages			700
Electricity Expenses			260
Total			130610	130610