Assessment Task 1 Manual Recording Case Study BuyIt&Sellem IMPORTANT: Part A: Manual Recording To record transactions manually, you must use the Excel files provided via email Handwritten work or Excel files other than the Excel files provided on the unit Canvas are not eligible for submission. So therefore, you will not record a score for this assessment READ THESE INSTRUCTIONS. THEY DETAIL HOW TO MAXIMISE YOUR RESULT. The items highlighted in yellow are important and so is the rest of the document! Case Study Background BuyIt&Sellem (ABN 12 345 678 901) operates as a company and you are the accountant for them. BuyIt&Sellem is a wholesale business specialising in electronic equipment made in Australia. The business charges GST on all sales and pays GST on purchases and most business expenses. The business is in its first month of the new year which started on 1st March 2019 Business Background The business was established by Maurice Moneybags from his garage and has now expended to a small warehouse and two part time employees. Maurice believes that with careful management that the business could expand to have a regular workforce within a few years. The products that are sold are exclusively available to BuyIt&Sellem Pty Ltd, so the aim is to expand the reputation of the products on offer. The aim is to have an online business specialising in electronic home entertainment products within 5 years Employees BuyIt&Sellem employs two casual assistants. Julia Hilton works as a sales person, and Peter Ball works in the warehouse filling orders. Each employee works between 30 to 40 hours per week, depending on the demand and the timing of the shipments of inventory. Payday is every second Thursday. The following information is used to calculate their wages: Name Role Gross pay- Per hour ($) Julia Hilton Sales Person 35 Peter Ball Warehouse assistant 28 At the 28th February the business owed the employees 22 hours to Julia and 24 hours to Peter. Goods and Services Tax (GST) All transactions incur GST except wages. The GST is 10% Merchandise Inventory The following is a list of closing inventory and the suppliers as at February 31st Quantity on hand Item Code Description Cost Price Sale Price Supplier 11 SMS Sanyo Music Station $140 $470 Sanyo Aust. Pty Ltd 9 EST EZ Deluxe slimline TVs $350 $820 EZ Products Australia Pty Ltd 13 PGC Pony Game console $185 $460 Pony Pty Ltd Each of the above items of inventory is quoted excluding GST. The required inventory is purchased mostly on credit under the terms of payment required by the suppliers. Your business has a good relationship with each of the suppliers once your company places an order, the suppliers will deliver them free of charge the same day. Due to the good relationship the suppliers have offered discount terms, indicated below; Suppliers account balances as at 28th February, 2019: Name Address ABN Terms of Credit Account Balance Date of Purchase Sanyo Australia Pty Ltd 21 Macquarie St Sydney 2000 45 667 778 888 2/15 net 30 $1,386 23rd February EZ Australia Pty Ltd 35 Lorimer St South Melbourne 3205. 56 778 889 999 1/15 net 30 $6,699 15th February Pony Pty Ltd 445 Swanston St Melbourne 3000 67 889 990 000 1/15 net 30 $0 Customer Information: BuyIt&Sellem sells most of its inventory strictly on a cash basis, but the business has three credit customers. The valued customers have been offered discount terms and these terms of payment are listed below. The outstanding account balance and the date of their purchase is also indicated in the account information Name Address ABN Terms of Credit Date of Invoice Account Balance Big HiFi 450 Bourke St Melbourne 3000 50 999 555 666 1/10 net 30 February 26 $4,320 The Electronic store 300Smithe street Collingwood 3068 89 911 222 333 1/10 net 30 February 19 $2210 Rivoli Hi Fi 296 Riversdale road Camberwell 3021 60 504 030 201 Net 30 $0 Chart of accounts You can find your chart of accounts in the excel document in the CANVAS shell BuyIt&Sell'em Trial Balance as at 28th February 2019 Account Number Account name Debit Credit 1001 Cash at Bank 53,112.00 1010 Accounts Receivable 6,530.00 1020 Inventory 11,775.00 1030 Prepaid Rent 1035 Prepaid Insurance 600.00 1040 Stationery Supplies 750.00 1110 Computers 8,000.00 1111 Accumulated Depreciation Office Computers 350.00 1120 Warehouse Equipment 26,000.00 1121 Accumulated Depreciation Warehouse Equipment 1,200.00 1130 Motor Vehicles 1131 Accumulated Depreciation Motor Vehicles 2001 Accounts Payable 8,085.00 2010 Wages Payable 1,442.00 2011 PAYG payable 2020 Telecommunications Payable 2030 GST Collected 3,566.00 2031 GST Paid 1,298.00 2035 Prepaid Revenue 2201 Loan - Best Bank 22,000.00 3001 Share Capital 50,000.00 3010 Retained Earnings 21,422.00 108,065.00 108,065.00 BuyIt&Sell'em Pty Ltd Trial Balance as at 28th February 2019 Transactions: March 2019 Date Description 1 Paid rent for 2(two) months - $2,420 (GST Inclusive). 3 Paid Cash for vehicle expenses- $250 (excluding GST) 3 Paid Sanyo Australia Pty Ltd. for February account. 4 Received payment from Big Hi Fi for February account. 4 Cash sales to Big HiFi Pty Ltd Inventory sold: 10 x SMS, 6 x EST and 6 x PGC 5 Received and paid electricity bill for February $ 660(including GST) 7 Paid EZ Australia Ltd. for February account. 7 Received payment from The Electronic Store PTY Ltd for February account. 8 Sales Invoice sent to Rivioli HiFi for the following items:15 x SMS, 12 x PGC 9 Pay day. Julia was paid for 60 hours and Peter was paid for 62 hours, which includes wages owing from February 14 Paid monthly repayment to ANZ for bank loan. $500 (includes $50 interest). GST is not payable on this transaction. 21 Pay day. Peter was paid for 64 hours and Julia was paid for 60 hours. 24 Purchased more inventory 12 x SMS, 20 x EST, 25 x PGC on credit 29 The Rivioli HiFi Pty Ltd paid for items purchased on March 8. 30 Cash sale made for 8 x SMS, 3 x EST and 6 x PGC. Delivery cannot be made until next week. 31 Paid Telephone Expenses for March $638 (including GST) Adjustments at 31 March 2019 1. Depreciation of computer equipment is $1,200 per annum. 2. Depreciation of Warehouse equipment is 5% of cost per annum. 3. Accrued wages: Peter 15 hour and Julia 13 hours. 4. Accrued Cleaning expenses for March $550 (including GST). A tax invoice has been received. 5. Stationery on hand at 31 March 2019 totalled $ 590. 6. The portion of prepaid insurance expired as of 31 March 2019 is $200. Part A: Manual Recording (20%) IMPORTANT: Part A Manual Recording To record transactions manually, you must use the Excel files provided on the unit Canvas. Handwritten work or Excel files other than the Excel files provided on the unit Canvas are not eligible for submission. Required: 1. Record the opening balances as at 1 March 2019 in the appropriate general ledger accounts 2. Record March months transactions in the general journal and post these to the general ledger. 3. Record end of month adjustments in the general journal and post these to the general ledger. 4. Prepare a Trial Balance after end of month adjustments as at 31 March 2019 5. Prepare an Income Statement for March 2019 and a Balance Sheet as at 31 March 2019.