Question

Chart of Accounts and Opening Balances 1^st November

Account Number	Account Name	Debit	Credit
110	Cash at Bank	18,835
120	Accounts receivable	16,140
121	Allowance for Doubtful Debts		646
130	Prepaid Insurance
140	Prepaid Rent	3000
150	Office Supplies	950
160	Inventory	19,000
180	Delivery Van
181	Accumulated Depreciation – Delivery Van
200	Accounts Payable		16,995
220	Wages Payable		377
230	GST Clearing		1,045
250	Superannuation Payable		756
300	Capital		38,106
310	Drawings
350	Income Summary
410	Sales Revenue
412	Sales Discounts
415	Services Revenue
420	Interest Revenue
500	Cost of Sales
512	Bad debts expense
515	Bank Charges
521	Depreciation expense – Delivery Van
530	Electricity and Gas Expense
540	Insurance Expense
560	Office Supplies Expense
565	Rent Expense
570	Superannuation expense
590	Wages Expense

All account balances at 1^st November are normal in nature.

Subsidiary Ledgers

Accounts Receivable Subsidiary Ledger

As at 1 November

Cayden’s Coffee Club	4,000
H. Proctor	12,140
	16,140

Accounts Payable Subsidiary Ledger

As at 1 November

Arabica Pty Ltd	6,765
Crema Supplies Pty Ltd	10,230
	16,995

Inventory on Hand

As at 1 November

	Units on Hand	Cost per Unit	Total
Espresso Sprint	40	320	12,800
Espresso Deluxe	10	620	6,200
			$19,000

NOVEMBER TRANSACTIONS

The transactions for Perfecto Coffee during November are listed below.

Note: All amounts are GST-inclusive where applicable.

          Credit sales are made on credit terms of 2/10, n/30

          Round all amounts to the nearest dollar.

	Date	Details
1.	November 1	Purchased a delivery van for $33,000 from Holland Autos on credit. Terms are n/60. Invoice number 15448.
2.	November 1	Paid insurance for 5 months in advance - $2,200 – chq 71.
3.	November 1	Paid Arabica Pty Ltd in full for outstanding account balance at 1st November – no discounts applicable - chq 72.
4.	November 2	Sold 10 Espresso Sprint machines for cash - $6,050.
5.	November 6	Purchased office supplies for cash - $330- chq 73.
6.	November 9	Received amount owed by Cayden’s Coffee Club for October invoices less the discount.
7.	November 9	Paid fortnightly wages of $1,760 – chq 74. ($1,383 relates to November wages; $377 relates to the wages accrued for October)
8.	November 12	Received payment from H. Proctor for part of the November balance - $2,140. There was no discount allowed.
9.	November 14	Purchased 15 Espresso Deluxe coffee machines from Arabica Pty Ltd for $10,395. Terms 3/10, n/30, Inv. 5430.
10.	November 15	Sold 17 Espresso Sprint machines to Cayden’s Coffee Club for $10,285, Inv. 4564.
11.	November 16	Invoiced Cayden’s Coffee Club for Barista training, Inv. 4565 for $3,300.
12.	November 16	The owner withdrew cash of $2,350 - chq 75.
13.	November 20	Paid the 1st November amount owing to Crema Supplies Pty Ltd with chq 76. No discounts were applicable.
14.	November 22	Paid electricity and gas bill, $390 – chq 77.
15.	November 23	Paid fortnightly wages of $1,760 – chq 78.
16.	November 23	Paid superannuation contributions owing from October of $756 – chq 79.
17.	November 24	Received payment from Cayden’s Coffee Club for invoice 4564, less the applicable discount.
18.	November 26	Sold to H. Proctor, 10 Espresso Deluxe machines - $9,350, inv. 4566.
19.	November 26	Purchased 20 Espresso Sprints coffee machines from Crema Supplies Pty Ltd for $7084. Terms 2/10, n/30, inv. 1389.
20.	November 30	Recorded bank charges of $40 and interest earned of $22.

Instructions for Completion of Practice Set

A.       Open all general ledger accounts by inserting the opening balances at 1 November as shown in the Chart of Accounts on page 3. For example, the balance of account 110 - Cash at Bank is $18,835 debit. Write “Opening Balance” in the “Details” column, and place $18,835 in the “Debit” balance column.

B.       Open all subsidiary ledger accounts for accounts receivable and accounts payable by inserting the opening balances as at 1 November as shown in the schedule of accounts receivable and accounts payable on page 4. Insert the opening inventory balances into the inventory cards.

Note: For the general ledger, accounts receivable subsidiary ledger and accounts payable subsidiary ledgers, all accounts have normal balances

C.       Record the transactions for November in the appropriate journals provided (narrations are not required).

D.      Post daily to the accounts receivable and accounts payable subsidiary ledgers.

Post daily from the general journal. All other amounts will be posted at the end of the month.

Note: For posting reference purposes, use the journal page names and numbers. For example, when posting from the sales journal the reference will be “SJ9”.

E.       Total all columns of the special journals. Post from the special journals to the general ledger.

F.        Prepare schedules of Accounts Receivable and Accounts Payable. Check that the total of the Schedule of Accounts Receivable equals the Accounts Receivable Control account in the general ledger and that the Schedule of Accounts Payable equals the Accounts Payable account in the general ledger.

G.       Use the worksheet provided to prepare an Unadjusted Trial Balance as at 30 November.

Check figures for this stage of the assignment are as follows:

·         Total of the Cash column in the Cash Receipts Journal - $22212

·         Cash at Bank account balance – Dr $14466

·         Inventory account balance – $20050.

·         GST Clearing account balance - Dr $1200

·         Unadjusted trial balance from worksheet - $115603

        Note: If any of your figures do not match those above, you have made an error which you will need to find and correct.

Answer 1