QUESTION 1
a. Use the information to record the transactions for March 2020 in the general journal (open the columns as indicated below).
b. Close the journal off at the end of March 2020. Use the following control columns for analysis purposes in the general journal:
Sales
Services rendered
Bank
Purchases
VAT Input
VAT Output
N.B. Round amounts to the nearest cent.
Enter transactions according to dates of the transactions.
Journal narrations should be omitted (i.e. left out).
QUESTION 2
How to i go about interpreting source documents(to be used on top on the extra information provided above)?
One of them:
BACKGROUND INFORMATION: Edward Moser is the sole-owner of Computer Wizz. This business provides repair services for computer hardware and it also sells computers, printers and accessories. Computer Wizz makes provision for credit sales. The credit policy stipulates that customers should settle their accounts within 7 days, after which interest of 10% per annum will be levied on a monthly basis. Computer Wizz is a registered VAT vendor and needs to submit the VAT201 form at the end of March 2020. The periodic inventory system is used and a gross profit margin of 20% is maintained. Source documents received from suppliers and creditors are not renumbered. The entity makes use of control accounts for debtors and creditors. Computer Wizz pays commercial rent. All amounts include VAT, unless stated otherwise. The following balances were taken from the general ledger at the end of February 2020: VAT Output R2 460 VAT Input R1 490 The following information is additional and is not necessarily included in the source documents, but should be taken into consideration and corrected, where appropriate, in the general journal: 1. 2. 3. The bookkeeper made a mistake during February 2020. A duplicate credit invoice (inventory was sold to Marvel Traders) was entered into the books as R780, instead of R870. The VAT column of the petty cash journal was not posted to the relevant VAT account in the general ledger at the end of February 2020. The total was R53 On 2 March 2020 a deposit of R3 990 was received as a refund from a supplier for goods that were sent back in February 2020. No entry was made for this transaction. On 2 March 2020 an amount of R15 000 was paid to Interprop. This amount included R6 000 as a deposit for renting the premises. Computer Wizz rented additional offices as from 1 March 2020. The rest of the amount is for the rent expense for March 2020. On 4 March 2020 an amount of R7 250.64 was paid to City of Tshwane. 25% of this account is for the owner's personal account. On 31 March 2020 the owner paid the office rent for April 2020 from his personal account, R9 000. This was because business banking was offline. 5. Big Bucks Bank Banking House Midrand South Africa 0860 456 7890 VAT no 404 897 8942 Client name and address: E Moser T/A Computer Wizz Shop 7 Bloomsberg Mall Phone 012 345 6789 Email info@computerwizz.co.za VAT no 401 789 6541 Account number: 123 456 7890 Amount Statement for the period 1 to 31 March 2020 Date Description 1/Mar Balance brought forward 2/Mar Deposit 2/Mar EFT Interprop 4/Mar EFT City of Tshwane 6/Mar Deposit 6/Mar Cash handling fee 6/Mar EFT Internet for Africa 8/Mar EFT CompMac Inv 871 15/Mar Deposit 15/Mar Cash handling fee 16/Mar EFT Tshwane News 17/Mar EFT Sparkle Clean 23/Mar Deposit MassMart D1 Inv T56 25/Mar Deposit 25/Mar Cash handling fee 29/Mar EFT Bidvest Waltons 29/Mar Deposit Inv T57 30/Mar EFT B Naidoo Salary 31/Mar Deposit 31/Mar Cash handling fee 31/Mar Outsure: Business Insurance 31/Mar Cell ABC: Business cell phones 31/Mar Interest on favourable balance 31/Mar Bank charges R3,990.00 -R15,000.00 -R7,250.64 R31,480.00 -R1,574.00 # -R1,908.50 -R14,330.00 R45,670.00 -R2,283.50 # -R8,700.00 -R560.80 R34,900.20 R12,930.00 -R646.50 # -R1,654.55 R7,240.40 -R23,648.56 R45,640.00 -R2,282.00 # -R5,468.00 -R4,813.00 R51.00 -R287.00 # Balance R78,641.45 R82,631.45 R67,631.45 R60,380.81 R91,860.81 R90,286.81 R88,378.31 R74,048.31 R119,718.31 R117,434.81 R108,734.81 R108,174.01 R143,074.21 R156,004.21 R155,357.71 R153,703.16 R160,943.56 R137,295.00 R182,935.00 R180,653.00 R175,185.00 R170,372.00 R170,423.00 R170,136.00 # Services incl VAT BACKGROUND INFORMATION: Edward Moser is the sole-owner of Computer Wizz. This business provides repair services for computer hardware and it also sells computers, printers and accessories. Computer Wizz makes provision for credit sales. The credit policy stipulates that customers should settle their accounts within 7 days, after which interest of 10% per annum will be levied on a monthly basis. Computer Wizz is a registered VAT vendor and needs to submit the VAT201 form at the end of March 2020. The periodic inventory system is used and a gross profit margin of 20% is maintained. Source documents received from suppliers and creditors are not renumbered. The entity makes use of control accounts for debtors and creditors. Computer Wizz pays commercial rent. All amounts include VAT, unless stated otherwise. The following balances were taken from the general ledger at the end of February 2020: VAT Output R2 460 VAT Input R1 490 The following information is additional and is not necessarily included in the source documents, but should be taken into consideration and corrected, where appropriate, in the general journal: 1. 2. 3. The bookkeeper made a mistake during February 2020. A duplicate credit invoice (inventory was sold to Marvel Traders) was entered into the books as R780, instead of R870. The VAT column of the petty cash journal was not posted to the relevant VAT account in the general ledger at the end of February 2020. The total was R53 On 2 March 2020 a deposit of R3 990 was received as a refund from a supplier for goods that were sent back in February 2020. No entry was made for this transaction. On 2 March 2020 an amount of R15 000 was paid to Interprop. This amount included R6 000 as a deposit for renting the premises. Computer Wizz rented additional offices as from 1 March 2020. The rest of the amount is for the rent expense for March 2020. On 4 March 2020 an amount of R7 250.64 was paid to City of Tshwane. 25% of this account is for the owner's personal account. On 31 March 2020 the owner paid the office rent for April 2020 from his personal account, R9 000. This was because business banking was offline. 5. Big Bucks Bank Banking House Midrand South Africa 0860 456 7890 VAT no 404 897 8942 Client name and address: E Moser T/A Computer Wizz Shop 7 Bloomsberg Mall Phone 012 345 6789 Email info@computerwizz.co.za VAT no 401 789 6541 Account number: 123 456 7890 Amount Statement for the period 1 to 31 March 2020 Date Description 1/Mar Balance brought forward 2/Mar Deposit 2/Mar EFT Interprop 4/Mar EFT City of Tshwane 6/Mar Deposit 6/Mar Cash handling fee 6/Mar EFT Internet for Africa 8/Mar EFT CompMac Inv 871 15/Mar Deposit 15/Mar Cash handling fee 16/Mar EFT Tshwane News 17/Mar EFT Sparkle Clean 23/Mar Deposit MassMart D1 Inv T56 25/Mar Deposit 25/Mar Cash handling fee 29/Mar EFT Bidvest Waltons 29/Mar Deposit Inv T57 30/Mar EFT B Naidoo Salary 31/Mar Deposit 31/Mar Cash handling fee 31/Mar Outsure: Business Insurance 31/Mar Cell ABC: Business cell phones 31/Mar Interest on favourable balance 31/Mar Bank charges R3,990.00 -R15,000.00 -R7,250.64 R31,480.00 -R1,574.00 # -R1,908.50 -R14,330.00 R45,670.00 -R2,283.50 # -R8,700.00 -R560.80 R34,900.20 R12,930.00 -R646.50 # -R1,654.55 R7,240.40 -R23,648.56 R45,640.00 -R2,282.00 # -R5,468.00 -R4,813.00 R51.00 -R287.00 # Balance R78,641.45 R82,631.45 R67,631.45 R60,380.81 R91,860.81 R90,286.81 R88,378.31 R74,048.31 R119,718.31 R117,434.81 R108,734.81 R108,174.01 R143,074.21 R156,004.21 R155,357.71 R153,703.16 R160,943.56 R137,295.00 R182,935.00 R180,653.00 R175,185.00 R170,372.00 R170,423.00 R170,136.00 # Services incl VAT
