Journal entry for end of period adjustments

Accounting procedures Transactions are Tecorded in the appropriate journals (rounded to the nearest dollar) from source documents on a daily basis. All cash receipts from customers and other sources are banked into the business cheque account at the Community Bank. A deposit slip Cash sales, other than those paid electronically by EFT, are often not banked until a few days after receipt. All payments are made by cheque drawn on the Community Bank; appropriate details are recorded on the cheque butt and these provide information for recording in the cash payments journal. When invoices are paid as soon as received, they are recorded in the cash payments journal and note is made on the invoice of the date paid and the cheque number. The business maintains subsidiary ledgers for accounts receivable and accounts payable, with separate accounts for each customer and each supplier. Transactions that affect the subsidiary ledger accounts, or general ledger accounts where prepared for this purpose. general journal transacri red in the 'Other column of the special journals, and At the end of the month, special journals are totalled and posted to the ledger. A worksheet is then prepared from the general ledger and adiuet eneral journal entries are recorded and posted to the general ledger. A statement of profit or loss and a statement of financial position are produced, together with schedules of accounts receivable and accounts payable. At the end of the financial year closing general journal entries are prepared and posted to the general ledger accounts. The business uses a periodic inventory system and a physical stocktake is undertaken at the end at that date. the financial year to determine the value of inventory on hand Note: General ledger accounts included. Check which format to use with your tutor before commencing the exercise. both 'running balance' and 'T account' formats are Account balances Opening balances for customers, including invoice details, are shown in figure 1.1. Supplier opening balances, including invoice details, are shown in figure 1.2. The trial balance for Mario's Pizza Palace as at 31 May 2016 is shown in figure 1.3. Schedule eceivable as at 31 May 2016 Date Customer Invoice No. Invoice Terms Amount Due Port City Motors Princess May Theatre 30/05/2016 389 385 N30 $400 330 N30 13/05/2016 FIGURE 1.1 Accou as at 31 May 2016 $730 Schedule of Accounts Payable as at 31 May 2016 Supplier Invoice No. Terms Date of Invoice Amount Due Foodmart Wholesalers Fresh Food Markets 27369 N30 1/05/2016 31/05/2016 9/05/2016 $1090 320 860 4182 5/10.N30 N15 Italian Store 19265 FIGURE 1,2 Accounts payable $2.270 2 MARIO'S PizZA PALACE Mario's Pizza Palace Trial Balance as at 31 May 2016 Account Account Debit Credit Number 100 Cash at Bank- Community Bank $33 705 110 Cash Float 50C Accounts Receivable 120 730 130 Inventory Food 1 250 Inventory Packaging Prepaid Advertising Prepaid Insurance Motor Vehicles (Cost) Accumulated Depreciation Motor Vehicles 140 980 150 640 160 1 980 170 17 700 171 11 680 Store Equipment (Cost) Accumulated Depreciation Store Equipment 180 4 860 18: 11 500 200 Accounts Payable PAYG Withholding Payable 2 270 210 840 220 Superannuation Payable 266 280 Bank Loan 18 900 Owner's Capital Owner's Drawings 300 51 674 310 38 400 400 Sales Income 172 300 410 Sales Returns & Allowances 50 420 Discounts Received 480 500 Food Purchases 49 870 Purchase Returns & Allowances 510 90 520 Packaging Costs 8 375 Discount Given 530 600 Accountancy Fees 1 200 605 Advertising 3520 615 Electricity& Gas Insurance Expense 2310 620 2030 010 625 Interest Expense 630 Motor Vehicle Expenses 8 Printing, Postage & Stationery Rent Evpense 635 640 24 200 Repairs & Maintenance 645 660 650 Sundry Exnens 0zE 655 Sun uation 3 190 a 660 Telephone 580 665 Wages 33 600 FIGURE 1.3 Trial halance as $ 270 000 $270.000 at 31 May 2016 Instructions Read the information provided in this chapter and the appendices to gain familiarity with the various source documents, business 1. erations, and accounting procedures. 2. Confirm that the opening balances at 1 June 2016 in the general ledger and the subsidiary ledgers, agree with the amounts shown in the figures above. CHAPTER 1: INTRODUCTION 3 OFFICE MEMORANDUM Date: 30/06/2016 To: Maria Italiano SUBJECT: End of period adjustments Adjusting journal entries are required for the following: 1. Wages payable at the end of June are $1300 2. Transfer 1/3rd of the prepaid insurance to the expense account 3. Transfer 50% of the prepaid advertising to the expense account 4. Superannuation payable for June is $266 5. Record depreciation for the year. Use the straight line (prime cost) method and the rates shown below Motor Vehicles 20% a. b. Store Equipment- 10% 6. Interest charged on the bank loan for the month was $84 7 Cash from sales of pizzas on 30/06/16 were $760 and this money was not banked until July (Hint: post to the cash float account) 8. The en packaging $4125. oc has determined that the closing inventory value of food is $1840 and Signed: Accountant ON Accounting procedures Transactions are Tecorded in the appropriate journals (rounded to the nearest dollar) from source documents on a daily basis. All cash receipts from customers and other sources are banked into the business cheque account at the Community Bank. A deposit slip Cash sales, other than those paid electronically by EFT, are often not banked until a few days after receipt. All payments are made by cheque drawn on the Community Bank; appropriate details are recorded on the cheque butt and these provide information for recording in the cash payments journal. When invoices are paid as soon as received, they are recorded in the cash payments journal and note is made on the invoice of the date paid and the cheque number. The business maintains subsidiary ledgers for accounts receivable and accounts payable, with separate accounts for each customer and each supplier. Transactions that affect the subsidiary ledger accounts, or general ledger accounts where prepared for this purpose. general journal transacri red in the 'Other column of the special journals, and At the end of the month, special journals are totalled and posted to the ledger. A worksheet is then prepared from the general ledger and adiuet eneral journal entries are recorded and posted to the general ledger. A statement of profit or loss and a statement of financial position are produced, together with schedules of accounts receivable and accounts payable. At the end of the financial year closing general journal entries are prepared and posted to the general ledger accounts. The business uses a periodic inventory system and a physical stocktake is undertaken at the end at that date. the financial year to determine the value of inventory on hand Note: General ledger accounts included. Check which format to use with your tutor before commencing the exercise. both 'running balance' and 'T account' formats are Account balances Opening balances for customers, including invoice details, are shown in figure 1.1. Supplier opening balances, including invoice details, are shown in figure 1.2. The trial balance for Mario's Pizza Palace as at 31 May 2016 is shown in figure 1.3. Schedule eceivable as at 31 May 2016 Date Customer Invoice No. Invoice Terms Amount Due Port City Motors Princess May Theatre 30/05/2016 389 385 N30 $400 330 N30 13/05/2016 FIGURE 1.1 Accou as at 31 May 2016 $730 Schedule of Accounts Payable as at 31 May 2016 Supplier Invoice No. Terms Date of Invoice Amount Due Foodmart Wholesalers Fresh Food Markets 27369 N30 1/05/2016 31/05/2016 9/05/2016 $1090 320 860 4182 5/10.N30 N15 Italian Store 19265 FIGURE 1,2 Accounts payable $2.270 2 MARIO'S PizZA PALACE Mario's Pizza Palace Trial Balance as at 31 May 2016 Account Account Debit Credit Number 100 Cash at Bank- Community Bank $33 705 110 Cash Float 50C Accounts Receivable 120 730 130 Inventory Food 1 250 Inventory Packaging Prepaid Advertising Prepaid Insurance Motor Vehicles (Cost) Accumulated Depreciation Motor Vehicles 140 980 150 640 160 1 980 170 17 700 171 11 680 Store Equipment (Cost) Accumulated Depreciation Store Equipment 180 4 860 18: 11 500 200 Accounts Payable PAYG Withholding Payable 2 270 210 840 220 Superannuation Payable 266 280 Bank Loan 18 900 Owner's Capital Owner's Drawings 300 51 674 310 38 400 400 Sales Income 172 300 410 Sales Returns & Allowances 50 420 Discounts Received 480 500 Food Purchases 49 870 Purchase Returns & Allowances 510 90 520 Packaging Costs 8 375 Discount Given 530 600 Accountancy Fees 1 200 605 Advertising 3520 615 Electricity& Gas Insurance Expense 2310 620 2030 010 625 Interest Expense 630 Motor Vehicle Expenses 8 Printing, Postage & Stationery Rent Evpense 635 640 24 200 Repairs & Maintenance 645 660 650 Sundry Exnens 0zE 655 Sun uation 3 190 a 660 Telephone 580 665 Wages 33 600 FIGURE 1.3 Trial halance as $ 270 000 $270.000 at 31 May 2016 Instructions Read the information provided in this chapter and the appendices to gain familiarity with the various source documents, business 1. erations, and accounting procedures. 2. Confirm that the opening balances at 1 June 2016 in the general ledger and the subsidiary ledgers, agree with the amounts shown in the figures above. CHAPTER 1: INTRODUCTION 3 OFFICE MEMORANDUM Date: 30/06/2016 To: Maria Italiano SUBJECT: End of period adjustments Adjusting journal entries are required for the following: 1. Wages payable at the end of June are $1300 2. Transfer 1/3rd of the prepaid insurance to the expense account 3. Transfer 50% of the prepaid advertising to the expense account 4. Superannuation payable for June is $266 5. Record depreciation for the year. Use the straight line (prime cost) method and the rates shown below Motor Vehicles 20% a. b. Store Equipment- 10% 6. Interest charged on the bank loan for the month was $84 7 Cash from sales of pizzas on 30/06/16 were $760 and this money was not banked until July (Hint: post to the cash float account) 8. The en packaging $4125. oc has determined that the closing inventory value of food is $1840 and Signed: Accountant ON