Jean Sutherland had devised an exercise to test the students understanding of which ledger to access and
Question:
Jean Sutherland had devised an exercise to test the students understanding of which ledger to access and how the double entry is completed. The exercise, although manual, is very similar to the way in which the computer works. Transactions: (i) Invoice of £50 to SLOO01 for 3 boxes of floppy disks. (ii) Transfer £100 from bank to petty cash. (iii) Invoice of £150 to SLO002 for 2 printers. (iv) Purchase of 10 IBM 486 PCs at £600 each from PLOOO1. (v) Purchase of 20 boxes of floppy disks at £10 each from PL0002. (vi) Cheque received from SLOOO1 for £50. (vii) Cheque received from SLO002 for £150. (viii) Make a payment of £3000 to PLOOO]. (ix) Purchase of 5 printers at £80 each from PLOOOL,
(x) Make payment of £200 to PL0002. (xi) Credit note received from PLO001 for £1 500 for damaged goods. (xii) Invoice of £1200 to SL0003. (xiii) Invoice of £2000 to SLOOO1. (xiv) Invoice of £3500 to SLOOO1. (xv) Credit note sent to $L0003 for £700. (xvi) Direct payment of £300 from bank for insurance. (xvii) Purchase of stationery for £35 from petty cash. (xviii) | Purchase milk and coffee from petty cash £11. (xix) Transfer £60 from bank to petty cash. (xx) - Payment of £1000 to PLOOO1. (xxi) £2000 cheque received from SLO0001. (xxii) £2000 cheque received from SLO0002. (xxiii) | £500 cheque received from SL0003. (xxiv) Sales invoice to SLOOO1 for £1000. (xxv) Sales invoice to $L0003 for £3000. (xxvi) Purchase invoice from PLOOO1 for £1700. (xxvii) | Purchase invoice from PLO002 for £750. (xxviii) Make a payment of £1300 to PLOOO1. (xxix) Make a payment of £750 to PLO002. (xxx) Transfer £75 from bank to petty cash. Required For each transaction listed ask yourself the questions shown in Figure 6.2 and then write your answer out as illustrated in Figure 6.13. Transaction one is done for you as an illustration. Transaction No 1:
(a) The transaction is a sales invoice, therefore the sales ledger is involved.
(b) Account $L0001 will be debited with the value of the invoice i.e. D £50.
(c) The debtor control account in the nominal ledger must also be debited with the value of the transaction i.e. D £50.
(d) The other half of the double entry in the nominal journal is to credit a sales account i.e. 4002. C £50.
You have already set up all the codes you need to use. Following each transaction ensure that the ‘iothinal ledger remains in balance i.e. the value is the debit entry is equal to the value of the credit entry.
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