Required:

Complete the following tasks for the month of June 2018 for Borderline Ltd.

• Read the attached information carefully.

• Enter the transactions into the appropriate journals - you are expected to use General and Special Journals.

• Post the transactions to the General Ledger accounts and balance the Accounts. (I recommend you also prepare trial balance at this stage to check your work).Enter Subsidiary Ledgers as appropriate.

• Prepare bank reconciliation, along with any general journal entries required.

• Complete required adjusting and closing journal entries and prepare post-closing trial balance.

• Prepare Statement of Financial Performance for June and a Statement of Financial Position as at 30 June 2018.

the following information must be create:

All journals and the full set of T accounts.

Post Closing Trial Balance at 30 June

Statement of Financial Performance for June

Statement of Financial Position as at 30 June

Bank Reconciliation at 30 June

• Company information for Borderline Ltd:

• Borderline Ltd run a small to medium sized wholesale business that sells building supplies to local builders and other retailers in Tasmania. The business was set up by James and Jess Jordenson who registered the company on 1 July 2016 by issuing 60 000 $1 par shares.James and Jess were allotted 52% of share capital and the balance to the general public.

• The company has not yet declared or paid any dividends.In the first year of its life the company made a profit after tax of $33 730.

• Borderline Ltd uses sales, purchases, cash receipts, cash payments and general journals along with subsidiary ledgers for debtors and creditors. The majority of their customers pay in cash but they do offer credit to a handful of valued customer. When Borderline makes credit sales, the terms are 3/10, n/10.

• Borderline rent a local warehouse and shopfront paying rent of $1500 per month.

• The company's shop fittings are being depreciated over 10 years with an estimated residual value of $5 400.The company's one Motor Vehicle, a delivery van, is being depreciated over 5 years with an estimated residual value of $5 000.

• The loan is a 5 year loan fully payable in five years time with interest to be paid at 9% per annum in arrears on the 1^st July each year. Interest for the year to date (up to 31 May) has already been recorded in the accounts.

• Provision for doubtful debts is always adjusted at the end of each month to equal 3% of the value of total debtors at the end of that month.

• The company account for GST on an accrual basis and reconcile and pay GST every quarter.All figures are GST inclusive.GST was last paid in April this year and is next due to be paid in July 2018.

• Joenhysen Ltd prepare their financial reports on a monthly basis at a cost of $250.

• All the transaction information provided includes GST unless otherwise indicated.

• All figures are to be rounded to the nearest dollar.

Given Information:

The trial balance of the company at 31 May 2018 was as follows:

Borderline Ltd

Post Closing Trial Balance

at 31 May 2018

DRCR

1000Cash at bank25 200

1100Debtors control9 000

1200Provision for doubtful debts300

1300Inventory85 000

1400Shop Fittings and Equipment60 000

1410Acc depreciation -Shop fittings and Equip10 465

1500Motor Vehicles35 000

1510Accumulated depreciation -M/Vehicles 11 500

2000Creditors control14 000

3000Share capital60 000

3100Retained profits81 735

5000GST Paid4 300

5010GST Collected8 500

5020Loan32 000

$218 500$218 500

Schedule of Debtors Schedule of Creditors

as at 31 May 2018as at 31 May 2018

Shade Ltd2 750

Roar Ltd1 300Mane Ltd250

Zane Ltd1 700Purple Ltd3 200

Jones Ltd1 100Pink Ltd0

Wide Ltd1 900Yard Ltd4 550

Mane250Zale Ltd6 000

$9 000$14 000

The following transactions occurred in June 2018 for Borderline Ltd:

June1Received a cheque for $1 200 from Roar Ltd in full settlement of its

account and deposited it in the bank account

3Sold inventory for $905(before any discounts have been applied) to Jones Ltd on credit (the company was given a trade discount of $80, then the normal credit terms) COGS was $420

4Paid rent for June $1 500, chq no. 561 (Assume the rent is GST free)

5Purchased inventory on credit from Pink $1 397, terms 2/10, n/15

6Paid Yard $4 500 being full settlement of amount owing, chq no. 562

8Received and deposited payment in full from Wide Ltd (no discount

allowed).

11Paid Pink in full by cheque, chq no. 563

12Paid telephone account by cheque of $320, chq no. 564

13Received a cheque for $700 from Jones Ltd in part payment of their account and deposited it in the bank account (no discount allowed).

14Banked cash sales for the first two weeks of the month totalling $20 900 (COGS was $9 800).

14Withdrew cash from the bank account to pay wages totalling $5 200, gross

wages were $7 400 (wages before tax)

17Paid $220 for cash register rolls and other stationery, chq no.565

18Sold inventory on credit to Zane Ltd $2 750 (COGS was $1 200)

21Sold inventory on credit to Wide $715 (COGS was $320)

23Paid Purple Ltd $3 200 (no discount allowed), chq no. 566

27Paid sundry expenses of $435 (GST free items), chq no. 567

28Wrote off the full amount owed by Mane Ltd as a bad debt

29Deposited Cash Sales of $27 500 ( COGS was $12 000)

30Withdrew cash from the bank to pay wages of $5 600, gross wages were

$7 600.

30Zane Ltd returned inventory which we had sold to them for $154 (COGS was $70). The returned inventory was in good condition and returned to the shelves and a credit note was issued to them.

30Purchased inventory on credit from Purple Ltd of $4510 after being allowing a trade discount of $90 and on terms of 1/10, n/30

(COGS was $2 100)

30Banked Cash Sales for the remainder of the month totalling $6 200.

30Paid the balance of the account for Zale Ltd (no discount was allowed) chq

no. 568

Additional Information:

Gross Wages owing at the end of the month total $1 320 and electricity owing for the month of June is $1 100.

Advertising owing for the month was $3 500

Income tax for the month of June 2018 is estimated to be $12 430

No entry had been made in the accounts to allow for any of these items.

The bank statement received at the end of June shows the following information:

Bank Statement

Borderline Ltd

2018DebitCreditBalance

June1Balance20 770CR

deposit5 40026 170CRdeposit1 200 27 370CR

3chq.no. 49865026 720CR

4chq.no. 49932026 400CR

5chq no. 5611 50024 900CR

8chq. no. 5624 50020 400CR

deposit1 90022 300CR

14deposit70023 000CR

14deposit20 90043 900CR

14cash withdrawal5 20038 700CR

19chq. no. 56432038 380CR

27chq. no. 5663 20035 180CR

29deposit27 50062 680CR

30cash withdrawal5 60057 080CR

31Bank fees/charges2357 057CR

31Interest8357 140CR

At 31 May 2018 there were two outstanding cheques- cheque no. 498 for $650 and cheque no. 499 $320 and one outstanding deposit of $5 400.

Part A - Manual Accounting(40 Marks)

Required:

Complete the following tasks for the month of June 2018 for Borderline Ltd.

• Read the attached information carefully.

• Enter the transactions into the appropriate journals - you are expected to use General and Special Journals.

• Post the transactions to the General Ledger accounts and balance the Accounts. (I recommend you also prepare trial balance at this stage to check your work).Enter Subsidiary Ledgers as appropriate.

• Prepare bank reconciliation, along with any general journal entries required.

• Complete ny required adjusting and closing journal entries and prepare post-closing trial balance.

• Prepare Statement of Financial Performance for June and a Statement of Financial Position as at 30 June 2018.

You must submit the following information:

All journals and the full set of T accounts.

Post Closing Trial Balance at 30 June

Statement of Financial Performance for June

Statement of Financial Position as at 30 June

Bank Reconciliation at 30 June

• Company information for Borderline Ltd:

• Borderline Ltd run a small to medium sized wholesale business that sells building supplies to local builders and other retailers in Tasmania. The business was set up by James and Jess Jordenson who registered the company on 1 July 2016 by issuing 60 000 $1 par shares.James and Jess were allotted 52% of share capital and the balance to the general public.

• The company has not yet declared or paid any dividends.In the first year of its life the company made a profit after tax of $33 730.

• Borderline Ltd uses sales, purchases, cash receipts, cash payments and general journals along with subsidiary ledgers for debtors and creditors. The majority of their customers pay in cash but they do offer credit to a handful of valued customer. When Borderline makes credit sales, the terms are 3/10, n/10.

• Borderline rent a local warehouse and shopfront paying rent of $1500 per month.

• The company's shop fittings are being depreciated over 10 years with an estimated residual value of $5 400.The company's one Motor Vehicle, a delivery van, is being depreciated over 5 years with an estimated residual value of $5 000.

• The loan is a 5 year loan fully payable in five years time with interest to be paid at 9% per annum in arrears on the 1^st July each year. Interest for the year to date (up to 31 May) has already been recorded in the accounts.

• Provision for doubtful debts is always adjusted at the end of each month to equal 3% of the value of total debtors at the end of that month.

• The company account for GST on an accrual basis and reconcile and pay GST every quarter.All figures are GST inclusive.GST was last paid in April this year and is next due to be paid in July 2018.

• Joenhysen Ltd prepare their financial reports on a monthly basis at a cost of $250.

• All the transaction information provided includes GST unless otherwise indicated.

• All figures are to be rounded to the nearest dollar.

The trial balance of the company at 31 May 2018 was as follows:

Borderline Ltd

Post Closing Trial Balance

at 31 May 2018

DRCR

1000Cash at bank25 200

1100Debtors control9 000

1200Provision for doubtful debts300

1300Inventory85 000

1400Shop Fittings and Equipment60 000

1410Acc depreciation -Shop fittings and Equip10 465

1500Motor Vehicles35 000

1510Accumulated depreciation -M/Vehicles 11 500

2000Creditors control14 000

3000Share capital60 000

3100Retained profits81 735

5000GST Paid4 300

5010GST Collected8 500

5020Loan32 000

$218 500$218 500

Schedule of Debtors Schedule of Creditors

as at 31 May 2018as at 31 May 2018

Shade Ltd2 750

Roar Ltd1 300Mane Ltd250

Zane Ltd1 700Purple Ltd3 200

Jones Ltd1 100Pink Ltd0

Wide Ltd1 900Yard Ltd4 550

Mane250Zale Ltd6 000

$9 000$14 000

The following transactions occurred in June 2018 for Borderline Ltd:

June1Received a cheque for $1 200 from Roar Ltd in full settlement of its

account and deposited it in the bank account

3Sold inventory for $905(before any discounts have been applied) to Jones Ltd on credit (the company was given a trade discount of $80, then the normal credit terms) COGS was $420

4Paid rent for June $1 500, chq no. 561 (Assume the rent is GST free)

5Purchased inventory on credit from Pink $1 397, terms 2/10, n/15

6Paid Yard $4 500 being full settlement of amount owing, chq no. 562

8Received and deposited payment in full from Wide Ltd (no discount

allowed).

11Paid Pink in full by cheque, chq no. 563

12Paid telephone account by cheque of $320, chq no. 564

13Received a cheque for $700 from Jones Ltd in part payment of their account and deposited it in the bank account (no discount allowed).

14Banked cash sales for the first two weeks of the month totalling $20 900 (COGS was $9 800).

14Withdrew cash from the bank account to pay wages totalling $5 200, gross

wages were $7 400 (wages before tax)

17Paid $220 for cash register rolls and other stationery, chq no.565

18Sold inventory on credit to Zane Ltd $2 750 (COGS was $1 200)

21Sold inventory on credit to Wide $715 (COGS was $320)

23Paid Purple Ltd $3 200 (no discount allowed), chq no. 566

27Paid sundry expenses of $435 (GST free items), chq no. 567

28Wrote off the full amount owed by Mane Ltd as a bad debt

29Deposited Cash Sales of $27 500 ( COGS was $12 000)

30Withdrew cash from the bank to pay wages of $5 600, gross wages were

$7 600.

30Zane Ltd returned inventory which we had sold to them for $154 (COGS was $70). The returned inventory was in good condition and returned to the shelves and a credit note was issued to them.

30Purchased inventory on credit from Purple Ltd of $4510 after being allowing a trade discount of $90 and on terms of 1/10, n/30

(COGS was $2 100)

30Banked Cash Sales for the remainder of the month totalling $6 200.

30Paid the balance of the account for Zale Ltd (no discount was allowed) chq

no. 568

Additional Information:

Gross Wages owing at the end of the month total $1 320 and electricity owing for the month of June is $1 100.

Advertising owing for the month was $3 500

Income tax for the month of June 2018 is estimated to be $12 430

No entry had been made in the accounts to allow for any of these items.

The bank statement received at the end of June shows the following information:

Bank Statement

Borderline Ltd

2018DebitCreditBalance

June1Balance20 770CR

deposit5 40026 170CRdeposit1 200 27 370CR

3chq.no. 49865026 720CR

4chq.no. 49932026 400CR

5chq no. 5611 50024 900CR

8chq. no. 5624 50020 400CR

deposit1 90022 300CR

14deposit70023 000CR

14deposit20 90043 900CR

14cash withdrawal5 20038 700CR

19chq. no. 56432038 380CR

27chq. no. 5663 20035 180CR

29deposit27 50062 680CR

30cash withdrawal5 60057 080CR

31Bank fees/charges2357 057CR

31Interest8357 140CR

At 31 May 2018 there were two outstanding cheques- cheque no. 498 for $650 and cheque no. 499 $320 and one outstanding deposit of $5 400.