ASSIGNMENT ANSWERS

Question 1

(a) Complete the eight boxes on the sales invoice below:

SALES INVOICE

S&A Pet Food Supplies

1 High Street
Sandbach
Cheshire

CW1 1AA
To: Tim’s Pet Shop Invoice No. 156472
10 Main Road Order No. 57473
Nantwich Customer account
code. TIM01
Cheshire
Invoice date 08.09.XX
CW5 6GG
Details Unit price Total Trade Net
Discount
£ £ £
%

20 x Adult dog food 15 litre (DG004) 18.99 379.80 10 341.82

Net total 341.82
VAT 68.36
Total 410.18

Terms: Net 30 days

Terms: 5% prompt payment discount for payment within 7 days
E&OE VAT Reg No. 246 4725 46

(b) If Tim’s Pet Shop settles his account and takes the prompt payment discount
offered, how much will he pay?
£389.67
 (c) Once Tim’s Pet Shop has settled his account and taken the discount, what action
should be taken regarding the settlement discount?

No action required
Issue a credit note for the discount amount X
Issue a credit note for the sales invoice amount
Issue a credit note for the VAT amount

(d) You have received payment for £564.62 from The Kitty Store on the 5th September
20XX. Identify which item has not been included in the payment, referring to the
Sales ledger account below:

Sales Ledger Account

The Kitty Store

Details Reference Amount Details Reference Amount

£ £
01.08.20XX 2654 354.60 10.08.20XX CN 105 30.50
04.08.20XX 2661 244.52 15.08.20XX Bank 229.00
05.08.20XX 2669 237.50 15.08.20XX Discount 12.50
28.08.20XX 2705 120.00

Invoice reference 2705 was not included in the payment.

Question 2

(a) Sales invoices have been partially entered in the day book below. You are required
to complete the entries and total the day book.

SALES DAY BOOK

DATE DETAIL REFERENCE TOTAL VAT NET

£ £ £
01.09.20XX Coopers Ltd SL02 169.80 28.30 141.50
03.09.20XX Potters & SL09 144.60 24.10 120.50
Co.
04.09.20XX Green Direct SL15 238.65 39.77 198.88
04.09.20XX Harpers SL20 363.20 60.53 302.67
05.09.20XX Coopers Ltd SL02 255.45 42.57 212.88

1,171.70 195.27 976.43

(b)

SALES INVOICE Invoice No: 2847

Pet World Direct

20 High Street

Crewe

CW1 6HH

To: S&A Pet Food Supplies

1 High Street Date/Tax Point: 28 September 20XX

Sandbach

Cheshire Your Order No: PO 2031

CW1 1AA

Unit VAT Goods

Rate
Product Quantity Description Price Total
Code

£ p % £ p

DF010 40 Dog food (puppy) 22 00 20 880 00

DF011 60 Dog food (adult) 20 00 20 1,200 00

DF012 30 Dog food (senior) 22 00 20 660 00

Goods Total 2,740 00

Less Trade Discount 10% 274 00

Net Goods 3,014 00

VAT 602 80
Carriage Paid
Total Due 3,616 80
Terms: Net 30 day

E & OE VAT Reg No: 835 7564 29

The terms should be 60 days, trade discount 20% and the discount has been added in
error, resulting in the Net Goods total being incorrect (and therefore subsequent totals)
Question 3

(a) Which item is missing from the statement of account?

The discount of £20.40 has been omitted from the statement of account.

(b) Which item is missing from the supplier account in the purchases ledger?

The invoice reference 5705 for £120.00 has been omitted from the purchase ledger.

(c) Assuming the omissions are the only errors, what amount will be due to The Village
Pet Store?

£120.00 will be due.

Question 4

(a)

CASH RECEIPTS BOOK

Date Detail Reference Bank VAT Receivables Cash
£ £ £ sales
£

01.09.20XX Balance b/f 125.40

07.09.20XX D. Sky SKY002 372.40 372.40
07.09.20XX C. Crookes CRO004 138.00 138.00
07.09.20XX P. Ryall RYA001 275.99 275.99
07.09.20XX Cash sales CS 228.00 38.00 190.00

Totals 1,139.79 38.00 786.39 190.00

(b) The payments side of the cash book totalled £823.90. What will the balance
brought down be in the cash book?

£315.89

(c) If the bank balance is a credit balance, does this mean the account is overdrawn?

Yes, a credit balance means the account is overdrawn.

 Question 5

(a) Enter the transactions into the partly completed petty cash book below, total the
petty cash book and show the balance carried forward as at the 5th September
20XX.

RECEIPTS PAYMENTS
Date Detail Total Date Detail Voucher Total Post Advert Sundry VAT
£ No. £
20XX 20XX
01.09 Bal B/f 88.20 01.09 Postage 44 6.20 6.20
01.09. Bank 61.80 02.09 Postage 45 7.80 7.80
03.09 Advert 46 54.00 45.00 9.00
04.09 Coffee 47 8.40 8.40
05.09 Bal C/f 73.60

150.00 150.00 14.00 45.00 8.40 9.00

(b) Which four accounts in the general ledger will record the above transactions?

Post, Advert, Sundry and VAT accounts

(c) At the end of the week, S&A Pet Food Supplies require the petty cash balance to be
restored to the imprest amount of £150.00. State the amount required to restore
the balance.

£76.40 (£150.00 - £73.60)

Question 6
(a) What will the entries be in the general ledger?

General ledger

ACCOUNT AMOUNT DEBIT CREDIT

£
Sales Returns 80.00 X
VAT 16.00 X
Sales Ledger Control 96.00 X

(b) Complete the subsidiary sales ledger accounts.

Sales ledger

ACCOUNT AMOUNT DEBIT CREDIT

£
Coopers Ltd 57.60 X
Harpers 38.40 X
Question 7

(a) What will the four entries be in the general ledger?

General ledger

ACCOUNT AMOUNT DEBIT CREDIT

£
VAT Account 170.40 X
Payables Account 3,700.00 X
Cash purchases 500.00 X
Sundry expenses 352.00 X

(b) The payables total includes a payment made to supplier Pet Direct for £320.00.
What will the entry be in the purchase ledger?

Purchase ledger

ACCOUNT AMOUNT DEBIT CREDIT

£

Pet Direct 320.00 X

Question 8

(a) What will the balance brought down on each account be?

ACCOUNT AMOUNT DEBIT CREDIT

Discount allowed 338.00 X
Bank interest received 68.60 X

(b) The purchases account shown below is also in the general ledger. You are
required to total the account and show the balance carried down as at the
7th September 20XX, and brought down as at the 8th September 20XX.

PURCHASES

DATE DETAIL £ DATE DETAIL £

01.09.20XX Balance b/d 2,567.80

05.09.20XX Bank 425.33
07.09.20XX Bank 210.66 07.09.20XX Balance c/d 3,203.79

3,203.79 3,203.79

08.09.20XX Balance b/d 3,203.79

Question 9
You have been given the Trial Balance below and now need to enter the amounts shown
in either the debit or credit columns, and then total the Trial Balance.

Trial Balance at 30th September 20XX

AMOUNT DR CR
£ £ £
Capital 21,340 21,340
Bank (overdraft) 1,030 1,030
Delivery vehicle 20,000 20,000
Shop equipment 4,300 4,300
Computer 1,200 1,200
Rent 6,000 6,000
Sales 25,000 25,000
Purchases 8,000 8,000
Discounts received 880 880
Discounts allowed 750 750
Advertising 400 400
Heat and light 1,050 1,050
Staff wages 6,000 6,000
Delivery vehicle fuel 550 550

48,250 48,250
Question 10
(a) State which of the following statement/s is/are correct for the accounting equation:

TRUE FALSE

Assets = Liabilities + Capital X

Assets – Liabilities = Capital X

Assets + Liabilities = Capital X

(b) State if the following are either an asset or liability:

ASSET LIABILITY

Bank overdraft X

Money due from customers X

Motor vehicles X

(c) State if the following items are capital income, capital expenditure, revenue income
or revenue expenditure:

CAPITAL CAPITAL REVENUE REVENUE

INCOME EXPENDITURE INCOME EXPENDITURE

Office equipment X

Sale of motor van X

Rent paid X

Receipt from cash X

sales