Figure 21.

1 : Purchases Cycle

Received Purchase Requisition from Departments

Purchase Requisition

Approved Suppliers Quotations

Clerk prepares a pre-numbered Purchases Order and obtains approval from officer.

PO PO PO 2 Purchase order (PO) 3

Purchase Requisition

4 1

To Supplier

To Store

To Accounting Department

Figure 21.4 : Purchases Department

From Purchase s Departm ent

Received goods and delivery note from supplier

Approved Purchase Order (PO)

Delivery Note

Match documents

App PO 3 Delivery Note

Storekeeper checks the goods received

Storekeeper prepares prenumbered receiving report and obtains approval from officer

App. SO 3 Receiving Rpt. 2 1 Receiving Report To Bin Card N To Accounts Department

Figure 21.5 : Stores-Receiving of Goods from Supplier

From Purchase Departm ent

From Stores

Received purchase invoice from supplier

2 Purchase Order

2 Delivery Note

Purchase Invoice

Match Docume nts

Clerk obtains approval from officer

Purchase Order Receiving Rpt. 2 Purchase Invoice

Figure 20.16 : Accounts Department

Purchase Invoice

Bookkeeper records in Purchase Journal

Bookkeeper records in Purchase Ledger

Purchase Journal

Purchase Ledger

Figure 21.7 : Journalising and Posting the Sales

Receive Remittance Advice from supplier

Purchase Invoice

Remittance Advice

Match docume nts

Prepare and obtain approval of Payment Voucher

Purchase Invoice Remittance Adv. Payment Vouch. Payment 3 Vouch. 2 1 Payment Voucher

To Cashier

Figure 21.8 : Approving payment vouchers.

From Accounts Departm ent

Purchase Invoice

Remittance Adv. Payment Vouch. 3 Payment Vouch. 2 1 Payment Voucher

Prepare and obtain approval of Cheque

Purchase Invoice Remittance Adv. Payment Vouch. 3 Payment Vouch. 2 Payment Vouch. 1 Cheque To Accounts Department

To Supplier

Figure 21.9 : Cashier-Approving Cheques

Payment Voucher

Bookkeeper records in Cash Book

Bookkeeper records in Purchase Ledger

Cash Book

Purchas e Ledger

Figure 21.10 : Accounts Department

Purchase Journal

Cash Book

Bookkeeper totals up the record entries (monthly)

Bookkeeper totals up the recorded entries (monthly)

Bookkeeper posts the total monthly sales to the Purchase Ledger Control Account

Bookkeeper posts the total monthly receipt to the Purchase Ledger Control Account

General Ledger

Figure 21.11 : Accounts Department

General Ledger

Purchase Ledger

Agree the Purchase Ledger Control A/c balance with total of Purchase Ledger balances

Bala nce agre e?

No

Bookkeeper prepares Creditors Reconciliation Statement

Creditors Reconciliation Statement

Figure 21.12 : Accounts Department

General Ledger

Receive Statement of Account from supplier

Statement of Account

Agree the Purchase Ledger Control A/c balance with Statement of Account

Balan ce agree ? No Bookkeeper prepares Creditors Reconciliation Statement

Creditors Reconciliation Statement

Figure 21.13 : Accounts Departments

Received Bank Statement

Bank Statements Bookkeeper ticks off the items that are the same and pick out the unpresented cheques and uncredited lodgement

Cash Book

Bookkeeper prepares Bank Reconciliation Statement and obtains approval from officer

Bank Reconciliation Statement

Figure 21.14 : Accounts Department