Case Study 1 Introduction In this assignment students are required to use the: General Ledger Banking Sales - Accounts Receivable Purchases - Accounts payable Inventory modules of the MYOB computer accounting program to process transactions and to produce a set of accounting reports relating to business operations. Input Business data The business is a book retailer named, Student Name Pty Ltd (students are to insert their own name) and is located at Your Address - Sydney NSW 2000.The firms sales are both over-the-counter cash and credit to well known customers. Company Name Address ABN Current Financial Year Last Month of Financial Year Starter Chart Your name Books Pty Ltd Your Address Your student Number 2020 June Retail Book store New Financial Year starting July, 2019 Conversion month: July 2019 Chart of Accounts You are to create your own chart of accounts by using one of the default charts provided by MYOB which most closely resembles the business or you can choose the Build your own option. If you are using one of the default charts, you may be required to modify/delete accounts to suit the nature of the transactions as given in the question. Transaction Source Cash registers for cash sales Invoices for credit sales Cheque book for cash payments Deposit books for cash receipts Bank statements for direct charges and direct deposits Supplier invoices for goods and services Working papers for adjusting and miscellaneous entries GST Please note that GST free items are bank fees, salaries and wages, interest expense, superannuation and fines you can check with your lecturer for others. Transaction Period New financial year starting 1st July 2019, and the processing period is July 2019, the current financial year is 2020, conversion month being July and there are 12 periods. Opening Balances as at 1 July 2019 General Ledger Account Balances Dr $ Cr $ Cash at Bank 48,000 Accounts Receivable 52,000 Inventory control 130,000 Prepayments 10,000 Shop Fixtures and Equipment 350,000 Accum Depn - Shop Fixt & Equip 120,000 Goodwill 50,000 Accounts Payable 40,000 GST payable (collected) 20,000 GST receivable (paid) 15,000 Accrued expenses 10,000 PAYG Withholding 10,000 Provision for dividend 50,000 Loan noncurrent 250,000 Issued and Paid up capital 120,000 Retained Earnings 35,000 655,000 655,000 Customers 1. Students are required to make up their own unique customer names and addresses. 2. Only credit sales are recorded, cash sales are put through the cash book. 3. The firm credit policy is 30 days. 4. Information provided for customers and their balance as at 1 July is as follows: Accounts Receivable Control Customer Code Balance Outstanding $ Days Outstanding C01 15,000 60 C02 12,000 30 C03 2,000 60 C04 7,000 30 C05 2,000 30 C06 4,000 60 C07 3,000 30 C08 2,000 30 C09 4,000 30 C10 1,000 30 Total 52,000 Suppliers 1. Students are required to make up their own unique supplier names and address. 2. Accounts Payable ledger has suppliers entered for trading stock as well as other goods and services acquired on credit. 3. Cash purchases, are processed directly through the cash book. 4. All suppliers extend the normal 30 day terms, with no discount for promptpayment. 5. Information provided for suppliers and their balance as at 1 July is as follows: Accounts Payable Control Supplier Code Balance Outstanding $ Invoice Date Be sure to enter an ABN numbers for each supplier when creating the Suppliers account otherwise there are taxation implications. All suppliers must have an ABN Number. S01 Trading Goods 6,000 1 st June S02 Trading Goods 2,000 5 th June S03 Trading Goods 12,000 7 th June S04 - Trading Goods 8,000 8 th June S05 Telephone Co 1,000 12th June S06 Stationery 1,500 15th June S07 Car Garage Co 1,500 6 th June S08 Trading Goods 3,000 13th June S09 Advertising Co 4,000 16th June S10 Courier Co 1,000 14th June Total 40,000 Inventory 1. Students are required to make up their own unique product names. 2. Inventory unit measure is per book item 3. The firm uses the perpetual inventory method of accounting for inventory, (that is when inventory is purchased it is added (debited) to Inventory account and when it is sold, the cost is debited against Cost of sales and credited againstInventory). 4. Information provided for inventory and their balance as at 1 July is as follows: Inventory Control Product Code Quantity on Hand Unit cost ($) Value of Inventory Unit Sell Price Excluding GST P01 1,000 $10.00 $10,000 $20.00 P02 250 $20.00 5,000 $40.00 P03 700 $10.00 7,000 $20.00 P04 1,000 $13.00 13,000 $26.00 P05 1,000 $5.00 5,000 $10.00 P06 1,000 $15.00 15,000 $30.00 P07 1,000 $12.00 12,000 $24.00 P08 1,000 $30.00 30,000 $60.00 P09 2,000 $13.00 26,000 $26.00 P10 700 $10.00 7,000 $20.00 $130,000 Transactions for July 2019 Data source: Suppliers Invoices. Dates shown are invoice dates, amounts include GST. Date Transaction Details 1 st Jul Received invoice from S01 for 100 books - stock item P01, for $1,320.00. 2 nd Jul Received invoice from S04 for 100 books - stock item P02, $1900.00 3 rd Jul Received invoice from S03 for 150 books, stock item P09 for $2,145.00 The Warehouse manager reported that only 140 books of product P09, had beenreceived.AccountsdepartmentadjustedS03saccountfortheshort delivery. 4 th Jul Purchased stationery on account from S06 for $550.00 (Charged to Expense account) 6 th Jul Received invoice from S08, $300 for 20 books - stock item P06. 7 th Jul Received invoice from S03, for 200 books stock item P04 $2,800 14th Jul Received invoice from S11 (new) $250.00 for Julys cleaning. 18th Jul Received invoice from S12 (new) $3000.00 for legal fees in relation to lease. 21st Jul Invoice from S10 for Julys courier service, $620.00. 24th Jul Received invoice from S05 for telephone for the month $835.00. 26th Jul Received invoice from S09 for advertising undertaken in July $4,500.00. 31st Jul Received invoice from S07 for petrol and repairs for company vehicle $550.00. Data source sales invoices and cash register tapes sales include GST. Cash sales Date Transaction Details 1 st Jul Sold 140 units P01 8 th Jul Sold 50 units of P02 and 50 units of P03 12th Jul Sold 30 units of P03, 25 units of P06, 30 units of P07 and 15 units of P08, 15th Jul Sold 20 units of P04, 15 units of P06 and 55 units of P08, 18th Jul Sold 35 units of P02, 10 units of P03, 35 units of P05, and 50 units of P10. 22nd Jul Sold 8 units of P03, 75 units of P04, 35 units of P06 and 15 units of P09. 31st Jul Sold 15 units of P06, 75 units P07 and 45 units P08. Credit sales: Date Transaction Details 5 th Jul Invoice to C01 for 100 units of P08 8 th Jul Invoice to C10 for 50 units of P10 12th Jul Invoice to C02 for 250 units of P01 14th Jul Invoice to C09 for 30 units of P02, 35 units of P03 15th Jul Invoice to C03 for 65 units of P02 and 200 units of P04 16th Jul Invoice to C07 for 80 units of P05 17th Jul Invoice to C08 for 90 units of P04 20th Jul Invoice to C04 for 50 units of P05 and 40 units of P08 22nd Jul Invoice to C06 for 200 units of P06 and 50 units of P07 22nd Jul Invoice to C05 for 100 units of P05 and 30 units of P07 23rd Jul Invoice to C05 for 255 units of P08 24th Jul Invoice to C06 for 125 units of P02. 24th Jul Invoice to C04 for 50 units of P09 and 60 units of P10 26th Jul Invoice to C07 for 70 units of P06 28th Jul Invoice to C08 for 100 units of P03 and 20 units of P09 Data source deposit book (cash receipts) The daily over-the-counter cash takings are banked the same day. Other receipts include payments by account customers, as follows: Date Transaction Details 17th Jul Customer C01 paid $15,000.00 18th Jul Customer C02 paid $12,000.00 19th Jul Customer C03, paid $2,000.00 20th Jul Customer C04 paid $7,000.00 21st Jul Customer C06 paid $4,000.00 22nd Jul Customer C07, paid for balance of his account as at 30 June, plus the purchases during the month made prior to 20th July. 23rd Jul Customer C08 paid $2000.00 24th Jul Received $4,000.00 from C09. 31st Jul At the end of the month, after the depreciation charge was made for the month, the business sold old Shop Fixtures and equipment for cash which had a written down value of $3,800.00 at the time of sale for $3,300.00 (GST inclusive). The plant and equipment originally cost $12,000.00. Data source cheque book (cash payments) Date Transaction Details 1 st Jul Drawn a cheque for $1,000.00 start a Petty Cash float. (Cheque 1055) 2 nd Jul Reimbursed $110.00 to an employee for travel expenses incurred. (Cheque 1056) 4 th Jul Paid Junes sales commission owing to retail assistants of $10,000.00 previously accrued. (Cheque 1057) 15th Jul Paid Junes PAYG withholding tax of $10,000.00 (Cheque 1058) 16th Jul Paid GST obligation for June, as per trial balance. (Cheque 1059) 17th Jul Paid S01 the balance of the account as at 30 June. (Cheque 1060) 19th Jul Paid S02 the balance of the account as at 30 June.(Cheque 1061) 20th Jul Paid S03 $12,000 being the amount owing as at 1st July. (Cheque1062) 23rd Jul Paid $3,000.00 employee superannuation (Cheque 1063) 27th Jul Paid balance as at 1 July owing to S04 (Cheque 1064) S05 (Cheque 1065) S06 (Cheque 1066) S07 (Cheque 1067) 28th Jul Paid wages to employees for the month amounting to $28,000 net of withholding tax. Cheque 1068). The withholding tax of $9,000 is to be paid on the 21 August. 29th Jul Reimbursed petty cash for Travelling Expense $220, Office Supplies $165, Postage $187, the total of the cheques drawn being $572 (Cheque 1069) 31st Jul The Directors paid $50,000 dividends, as provided in June. (Cheque1070) Data source - bank statements Date Transaction Details 18th Jul Periodic payment for lease of POS equipment $990.00 for July. 31st Jul Bank fees of $110.00 were charged to the account. Data source notes and working papers Month end adjustments Date Transaction Details 31st Jul Shop fixtures and equipment are depreciated at 20% p.a. diminishing value and the entry for July 2019 (being 31 days of depreciation) needs to be made. 31st Jul Sales commission earned by retail assistants, but not paid at 31st July amounted to $5000.00. 31st Jul Prepaid expenses as at 30 June ($10,000.00) represented the premium paid on annual policy starting on 1 May 2019. Record the insurance expense expired for the month of July. 31st Jul The companys long term loan is at 9.00% p.a. Interest is paid quarterly, but needs to be accrued for July (31 days). 31st Jul Create a provision for doubtful debts equal to 5% of Accounts Receivable balance as at 31st July. 31st Jul Estimated electricity usage for July amounted to $2,100.00 and this amount is to be accrued as at 31st July.