Mudgee Ltd issued the following invoices to customers in respect of credit sales made during the last week of May 20X7. The amounts stated are all net of Value Added Tax. All sales made by Mudgee Ltd are subject to VAT at 15%.

On 29 May Laira Brand returned half the goods (in value) purchased on 25 May. An allowance was made the same day to this customer for the appropriate amount.

On 1 May 20X7 Laira Brand owed Mudgee Ltd £2,100.47. Other than the purchases detailed above Laira Brand made credit purchases (including VAT) of £680.23 from Mudgee Ltd on 15 May. On 21 May Mudgee Ltd received a cheque for £2,500 from Laira Brand.

Required:

(a) Show how the above transactions would be recorded in Mudgee Ltd’s Sales Day Book for the week ended 30 May 20X7.

(b) Describe how the information in the Sales Day Book would be incorporated into Mudgee Ltd’s double entry system.

(c) Reconstruct the personal account of Laira Brand as it would appear in Mudgee Ltd’s ledger for May 20X7.

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Invoice No 3045 3046 3047 3048 3049 Date 25 May 27 May 28 May 29 May 30 May Customer Laira Brand Brown Bros Penfold's T Tyrrell Laira Brand Amount £ 1,060.00 2,200.00 170.00 460.00 1,450.00 £5,340.00