Tut Week4 - ACCY111 Week 4 Tutorial PDF

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ACCY111 Week 4 Tutorial...

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Ex 3.6 Account titles and types LO2 Each of the following items describes aspects of the business of Lenny Linnehan, lawyer. 1. Cash which Lenny Linnehan has withdrawn from the business for personal use Drawings Equity 2. Photocopiers, document binding machine and computers Plant and Equipment Asset 3. Amounts owed by the business to suppliers of an online legal database Accounts Payable Liability 4. Amounts owed by customers for cases completed Account Receivable Asset 5. Tables, wall shelving and book cabinets for staff offices Plant and Equipment Asset 6. GST charged to clients for legal services GST Payable and Receivable Liability 7. Money borrowed from a bank Cash at bank Asset 8. Lease rental on premises which should have been paid 1 month ago Account Payable Liability 9. Supplies held for future document preparation Plant and Equipment Asset

10. Insurance premium paid in advance to cover the next 6 months Prepaid Expenses Expense Required (a) Suggest an account title for each item described above. (b) Classify the item as an asset, liability, equity, income or expense.

Ex 3.8 Recording transactions in general journal and analysis LO4 The following accounts appear in the ledger of Henrietta’s Huge Hair Hairdressers: Cash at Bank; Accounts Receivable; Hairdressing Equipment; Accounts Payable; Henrietta Bouffant, Drawings; Hairdressing Revenue; Salaries Expense; and Advertising Expense. Required (a) Prepare the general journal entries to record the following transactions that occurred during December (ignore GST). (b) Explain why you have made each of the journal entries to account for the transactions. Dec. 1 Purchased hair-drying equipment for $65 000. Paid $5000 deposit and agreed to pay the balance in 60 days. 3 Henrietta withdrew $1200 from the business to buy herself a new dress for a friend’s wedding. 8 Paid salaries of $6800. 14 Paid $800 for advertisements in the local newspaper. 19 Received $540 from customers to reduce the balance in their accounts. 23 Paid $3700 to creditors for supplies that had been purchased on credit. 30 Earned $57 600 in hairdressing revenue during the month. Of this, 80% was collected in cash and 20% will be paid within a month.

a. General journal entries Henrietta’s Huge Hair Hairdressers Date Decembe r

Particular 1st

Hairdressing Equipment

Post Ref

Debit $65 000

Cash Account Payable Hai-drying purchased 3rd

Drawings

Credit

5 000 60 000

1 200

Cash Cash drawings by owner 8th

1 200

Salaries Expense Cash at Bank Cash paid for salaries

6 800 6 800

14th Advertising Expense Cash at Bank Cash paid for ads

800

19th Cash Account Receivable

540

800

540

23rd Account Payable Cash

3 700

30th Cash Account Receivable Account Receivable

57 000

3 700

45 600 11 400

P 3.19 Journal entries, entering beginning account balances, posting to T accounts, and trial balance LO3, 4, 5 The 31 May 2020 trial balance of Amy Wait, Physiotherapist, is shown below. Ignore GST. AMY WAIT, PHYSIOTHERAPIST Trial Balance as at 31 May 2020 Account Cash at Bank Accounts receivable Supplies Prepaid Insurance Furniture and Equipment Accounts Payable Electricity account payable Unearned revenue A. Wait, Capital A. Wait Drawings Services revenue Salary expense

Debit $105 000 48 000 12 300 8 200 260 000

Credit

$9 700 9 500 2 900 314 960 161 200 462 000 170 300

Electricity expense Rent expense

9 460 24 000 $799 060

$799 060

The following transactions were completed during June. June 1 Purchased supplies on credit for $5800. 3 Received $24 400 from patients as payment on account. 6 Paid the electricity expense of $9500, previously recorded. 10 Performed services for $2000 that was recorded previously as unearned revenue. 14 Recorded revenue of $178 600 in cash and $13 650 on credit. Paid salaries of $65 880. 20 Purchased furniture for $15 400, paid by electronic transfer. 23 Withdrew $60 000 from the business for personal use. 24 Paid creditors $7000. 26 Purchased insurance policy for $24 000 to cover business assets. 27 Received $12 000 from patients as payment on account. 29 Recorded revenue of $124 600 in cash and $25 000 on credit. 30 Paiıd rent of $24 000.

Required (a) Prepare journal entries to record each transaction. (b) i. Open T accounts for the accounts shown in the trial balance. ii. Enter the 31 May balance in each account. iii. Post the journal entries to the T accounts. (c) Prepare a trial balance as at 30 June 2020....