Skate n Surf began operations on 1 June, buying and selling surfboards, skateboards, wetsuits and the protective gear for skateboarding. The structure of the business is that of a sole trader. The business employed a sales assistant during the month who is to be paid fortnightly. Tax is deducted from the employees wages (PAYG withholding tax) and remitted to the Australian Taxation Office (ATO) on a quarterly basis. The business has not registered with the ATO for the goods and services tax (GST) and has elected to use the accrual basis of accounting. Accounting records The business records all transactions in the general journal. These transactions are then posted to the appropriate account(s) in the general ledger. The accounts receivable and accounts payable subsidiary ledgers are provided for information only, you are not required to post to these ledgers. Chart of accounts The chart of accounts for Skate n Surf contains the accounts and account numbers below.

The entries have been journalised below.

General journal
Date	Description	Post ref.	Debit	Credit
20XX
June 1	Cash at bank		30,500
	Capital			30,500
	(Owner's capital contribution)
1	Shop equipment (cost)		32,200
	Bank loan			28,500
	Cash at bank			3,700
	(Display stands, shelving and computer for shop; loan repayable over 3 years)
2	Inventory		25,000
	Accounts payable			25,000
	(Inventory purchase on terms of net 30)
5	Postage and stationery expense		340
	Cash at bank			340
	(Cash purchase of stationery)
7	Inventory		19,000
	Accounts payable			19,000
	(Credit purchase on terms of 10/10, n/30)
9	Accounts payable		19,000
	Cash at bank			17,100
	Discount received			1,900
	(Supplier paid less prompt payment discount)
11	Prepaid insurance		3,800
	Cash at bank			3,800
	(1 year insurance policy)
12	Advertising expense		1,510
	Cash at bank			1,510
	(Advertising for the month)
13	Accounts receivable		5,000
	Sales revenue			5,000
	(Credit sale on terms of 5/10, n/30)
13	Cost of sales		2,700
	Inventory			2,700
	(Adjust inventory)
14	Accounts receivable		7,000
	Sales revenue			7,000
	(Credit sale on terms of net 30)
14	Cost of sales		3,800
	Inventory			3,800
	(Adjust inventory)
17	Accounts receivable		4,050
	Sales revenue			4,050
	(Credit sale on terms of net 15)
17	Cost of sales		3,200
	Inventory			3,200
	(Adjust inventory)
18	Accounts payable		190
	Inventory			190
	(Faulty protective gear returned to supplier)
18	Cash at bank		4,750
	Discount allowed		250
	Accounts receivable			5,000
	(Payment received less prompt payment discount)
19	Sales returns and allowances		810
	Accounts receivable			810
	(Wetsuits returned by customer put back into inventory)
19	Inventory		350
	Cost of sales			350
	(Adjust inventory)
20	Cash at bank		900
	Sales revenue			900
	(Cash sale)
20	Cost of sales		450
	Inventory			450
	(Adjust inventory)
23	Accounts payable		3,000
	Cash at bank			3,000
	(Part payment of amount owing)
25	Accounts receivable		7,100
	Sales revenue			7,100
	(Credit sale on terms of 5/10, n/30)
25	Cost of sales		3,790
	Inventory			3,790
	(Adjust inventory)
26	Cash at bank		4,600
	Accounts receivable			4,600
	(Payment received from customer)
27	Inventory		7,700
	Accounts payable			7,700
	(Credit purchase on terms of 10/10, n/30)
30	Telephone expense		200
	Cash at bank			200
	(Pay telephone expense)
30	Wages expense		900
	Cash at bank			850
	PAYG withholding payable			50
	(Wages paid to Scott Walker)

100 Cash at bank 110 Accounts receivable 120 Inventory 130 Prepaid insurance 171 Shop equipment (cost) 172 Accumulated depreciation - shop equipment 200 Accounts payable 210 PAYG withholding payable 220 Superannuation payable 230 Bank loan 300 Capital 310 Drawings 320 Profit or loss summary 400 Sales revenue 410 Sales returns and allowances 420 Discount received 500 Cost of sales 600 Advertising expense 610 Depreciation expense 620 Discount allowed 630 Electricity expense 640 Insurance expense 650 Interest expense 660 Postage and stationery expense 670 Superannuation expense 680 Telephone expense 690 Wages expense Transactions June 1 The owner opened a bank account for the business with a deposit of $30,500. This is capital provided by him. 1 Purchased display stands, shelving etc. (shop equipment) from Shop Displays Pty Ltd for $28,500 and computer equipment for the shop from Computer Wizards for $3,700. These were paid for with a loan of $28,500 from the bank and cheque for $3,700 from the business bank account. The bank loan is repayable over 3 years. 2 Purchased inventory (skateboards and protective gear) from Excitement plus for $25,000 on terms on net 30. 5 Cash purchase of stationery from Officeworks for $340. 7 Purchased surfboards and wetsuits from Surf Imports for $19,000 on terms of 10/10, n/30. 9 Paid Surf Imports the amount owing to them less the prompt payment discount. 11 Paid $3,800 for a 1-year insurance policy covering fire, theft, and public liability. 12 Paid $1,510 to Local Newspapers for advertising for the shop for the month. 13 Credit sale to Serious Fun of skateboards and protective gear for $5,000 (cost of sales $2,700). This customer was given terms of 5/10, n/30. 14 Credit sale to Surfing World of various inventory items for $7,000 (cost of sales $3,800). Terms net 30. 17 Credit sale to Academy Diving School of 15 wetsuits at a discounted price of $270 each on terms of net 15. Cost of sales $3,200. 18 Returned some protective gear to Excitement Plus that was faulty and received an adjustment note (credit note) from them for $190. 18 Received a cheque from Serious Fun for the amount owing by them after deducting the prompt payment discount. 19 Issued an adjustment note (credit note) to Academy Diving School for 3 wetsuits at $270 each that was not the size they required. The cost of the wetsuits to us was $350 and they were put back into inventory. 20 Cash sale of inventory to the value of $900 (cost of sales $450). 23 Paid Excitement Plus $3,000 of the amount owing to them. 25 Credit sale to Serious Fun of skateboards for $7,100 (cost of sales $3,790). Terms 5/10, n/30. 26 Received and banked a cheque for $4,600 from Surfing World in part payment of the amount owing by them. 27 Purchased wetsuits from Surf Imports for $7,700 on terms of 10/10, n/30. 30 Paid Telstra $200 for telephone expenses. 30 The owner cashed a cheque for $850 to pay wages to Scott Walker the sales assistant of $900 less PAYG Withholding of $50. Post to the general ledger accounts. The accounts receivable and accounts payable subsidiary ledgers are provided for information only. Accounts receivable subsidiary ledger Credit Debit 4,050 810 Credit Academy Diving School Date Explanation June 17 Invoice 19 Adjustment note Serious Fun Date Explanation June 13 Invoice 18 Receipt 25 Invoice Suring World Date June 14 Invoice 26 Receipt Debit 5,000 Acct code: ADI Balance 4,050 Dr 3,240 Dr Aoct code: SFU Balance 5,000 Dr 0 7,100 Dr Acct code: SWO Balance 7,000 Dr 2,400 Dr 5,000 7,100 Explanation Credit Debit 7,000 4,600 Accounts payable subsidiary ledger Debit Credit 25,000 190 3,000 Excitement Plus Date Explanation June 2 Invoice 18 Adjustment note 23 Payment Surf Imports Date Explanation June 7 Invoice 9 Payment 27 Invoice Acct code: EPL Balance 25,000 24,810 21,810 Acct code: SIM Balance 19,000 0 7,700 Debit Credit 19,000 19,000 7,700 (Note: For any ONE specific transaction containing multiple entries, enter accounts in descending amounts. For example, if a transaction has three accounts, such as two debits and one credit or two credits and one debit from the general Journal, one of the t-ledgers will have two accounts. In this instance, please post the two accounts in the general ledger in descending amount order to indicate the accounts involved in that transaction. Leave blank any answer fields that do not require an answer.) Ne 100 Cash at bank Date Details Debit Date Details Credit June June No. 110 Accounts receivable Date Details Debit Date Details Credit June June Inventory No. 120 Date Details Debit Date Details Credit June No. 110 Prepaid insurance Date Details Debit Date Details Credit June No. 171 Shop equipment (cast) Date Details Debit Date Details Credit June No. 172 Accumulated depreciation - shop equipment Date Details Debit Date Details Credit No. 206 Accounts payable Date Details Debit Date Details Credit June June No. 210 PAYS withholding payable Date Details Debit Date Details Credit June No. 220 Superannuation payable Date Details Debit Details Credit No. 230 Bank loan Date Details Debit Date Details Credit June Capital No. 30 Date Details Debit Date Details Credit June No. 310 Drawings Date Details Debit Date Details Credit No. 1 Profit or loss suimary Date Details Debit Date Details Credit No. 400 Sales revenue Date Details Debit Date Details Credit June No. 410 Sales returns and allowances Date Details Debit Date Details Credit June No. 420 Discount received Date Details Debit Date Details Credit June Cost of sales No. 500 Date Debit Dale Details Credit June June No. 600 Advertising expense Date Details Debit Date Details Credit June No. 010 Depreciation expense Date Details Debit Date Details Credit No. 620 Discount allowed Date Details Debit Date Details Credit June No. 630 Electricity expande Date Details Debit Date Details Credit No. 640 Insurance expense Date Details Debit Date Details Credit No. 650 Interest expense Date Detalle Debit Date Detalle Credit No. 660 Postage and Matery expense Date Detail Debit Date Details Credit June No. 670 Superannuation expense Date Details Debit Date Details Credit No. 680 Telephone expense Date Details Debit Date Details Credit June No. 60 Wages expense Date Details Debit Date Details Credit June