Question 3 Steven owns and runs a store called Zodiac General Dealer He allows goods to be sold on credit Zodiac's year end is 28 February Steven went over all information pertaining to debtors to find out why the Debtors Control balance was not the same as the total of the Debtors List He discovered the following Invoice 209 for R4 270 made out to B Baker was entered into the account of C Baker in error The Debtors Allowances column in the Debtors Allowances Journal was added incorrectly as R21 790 The correct amount was R24 790 An invoice made out to Mr Asher was incorrectly recorded as R16 840 in the Debtors Journal The invoice was for R16 480 The incorrect amount was also posted to the Debtors ledger Interest of R270 should have been added to Miss Capricorns account The bookkeeper had forgotten to do this and had not made any entries for this Connor Davis paid R4 950 after receiving a 10 settlement discount These transactions were correctly recorded in the cashbook receipts and general journal respectively The bookkeeper posted the general journal entries to the general ledger, but not to the individual account of Connor Davis in the debtors ledger On the 25 February 2023 Zodiac received R8 300 from Michaela Walsh Michaela Walshs account was previously written off as a bad debt in December 2022 The receipt now received was entered into the Debtors Control column in the Cashbook receipts The total of the debtors control column was posted to the debtors control general ledger account The Debtors control balance on 28th February 2023 R42 640 The Debtors List Balance on 28th February 2023 R48490 Zodiac sent the following statement of account to a debtor, Antares Stores QUESTIONS 3 5 Prepare the journal entry to record the settlement discount granted, should Antares Stores pay the R16 268 current amount owing within 30 days Journal narration is not required You may ignore the Document number and folio columns Assume that Zodiac General dealers is a VAT registered vendor 3 6 Prepare the journal entry to record the interest receivable, should Antares Stores fail to pay the 90 days outstanding debt of R32 380 Q 3 7 There is an error on the statement of account of Antaras Stores sent by Zodiac General Dealers above Identify the error and explain why it is an error Q 3 8 Antares Stores complained that they paid another R10 000 in cash towards their debt so they should not have been charged interest This payment was not reflecting on their statement Steven found that his bookkeeper forgot to deposit the cash and enter it in the records The cash was deposited on the 15th of March 2023 Explain to Antares Stores when this amount will appear on their statement 5 discount granted if paid within 30 days of statement date Debt must be paid within 60 days of statement date Interest charged at 2 per month on balances 90 days overdue

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Question 3 Steven owns and runs a store called Zodiac General Dealer. He allows goods to be sold on credit. Zodiac's year-end is 28 February.

Question 3

Steven owns and runs a store called Zodiac General Dealer. He allows goods to be sold on credit. Zodiac's year-end is 28 February. Steven went over all information pertaining to debtors to find out why the Debtors Control balance was not the same as the total of the Debtors List.

He discovered the following:

Invoice 209 for R4 270 made out to B Baker was entered into the account of C Baker in error.
The Debtors Allowances column in the Debtors Allowances Journal was added incorrectly as R21 790. The correct amount was R24 790.
An invoice made out to Mr Asher was incorrectly recorded as R16 840 in the Debtors Journal. The invoice was for R16 480. The incorrect amount was also posted to the Debtors ledger.
Interest of R270 should have been added to Miss Capricorns account. The bookkeeper had forgotten to do this and had not made any entries for this.
Connor Davis paid R4 950 after receiving a 10% settlement discount. These transactions were correctly recorded in the cashbook receipts and general journal respectively. The bookkeeper posted the general journal entries to the general ledger, but not to the individual account of Connor Davis in the debtors ledger.
On the 25 February 2023 Zodiac received R8 300 from Michaela Walsh. Michaela Walshs account was previously written off as a bad debt in December 2022. The receipt now received was entered into the Debtors Control column in the Cashbook receipts. The total of the debtors control column was posted to the debtors control general ledger account.
The Debtors control balance on 28th February 2023: R42 640
The Debtors List Balance on 28th February 2023: R48490

Zodiac sent the following statement of account to a debtor, Antares Stores:

QUESTIONS

3.5 Prepare the journal entry to record the settlement discount granted, should Antares Stores pay the R16 268 current amount owing within 30 days. Journal narration is not required. You may ignore the Document number and folio columns. Assume that Zodiac General dealers is a VAT registered vendor.

3.6 Prepare the journal entry to record the interest receivable, should Antares Stores fail to pay the 90 days outstanding debt of R32 380.

Q.3.7 There is an error on the statement of account of Antaras Stores sent by Zodiac General Dealers above. Identify the error and explain why it is an error.

Q.3.8 Antares Stores complained that they paid another R10 000 in cash towards their debt so they should not have been charged interest. This payment was not reflecting on their statement. Steven found that his bookkeeper forgot to deposit the cash and enter it in the records. The cash was deposited on the 15th of March 2023. Explain to Antares Stores when this amount will appear on their statement.

- 5% discount granted if paid within 30 days of statement date. - Debt must be paid within 60 days of statement date. - Interest charged at 2% per month on balances 90 days overdue