SUGGESTED SOLUTION TO QUESTION 7.

1
1 Page only
TRUST CASH BOOK

Correspondent 1 322,00 James Clark 1 265,00

57,00
R1 322,00 R1 322,00

BUSINESS CASH BOOK

Transfer from trust 57,00

CORRESPONDENT - TRUST ACCOUNT

J. Clark - collection Cash received 1 322,00

Christie transferred 1 500,00 235,00
Transfer to business 57,00
R1 557,00 R1 557,00

CORRESPONDENT - BUSINESS ACCOUNT

One third R57,00 Transfer from trust R57,00

JAMES CLARK - TRUST ACCOUNT

Correspondents 235,00 Cash - C Christie 1 500,00

Cheque - self 1 265,00
R1 500,00 R1 500,00

FEES

Correspondent 50,00

VAT ACCOUNT

Correspondent 7,00
TRUST JOURNAL
DR CR
Correspondent (T)
1 500,00
James Clark (T) 1 500,00
Transfer collection C. Christie

James Clark (T)

235,00
Correspondent (T) 235,00
Disbursement C Christie

FEE JOURNAL

Correspondent (B)
57,00
Fees 50,00
VAT output 7,00
One third allowance collection
James Clark - C Christie

TRANSFER JOURNAL
Correspondent (T)
57,00
Correspondent (B) 57,00
Transfer fees
 SUGGESTED SOLUTION TO QUESTION 7.1
Page 2 of 2 pages

Accounting Statement to James Clark R R

re: Collection Charles Christie
Cash received 1 500,00
Correspondents - charges 171,00
- disbursements
64,00
Cheque herewith 1 265,00
1 500,00 1 500,00
 SUGGESTED SOLUTION TO QUESTION 7.2
Page 1 of 2 pages

TRUST CASH BOOK

Seminar Properties - deposit 2 000,00 Seminar Properties refund 110,00

Correspondent 1 320,00
Transfer to business 570,00
R2 000,00 R2 000,00

SEMINAR PROPERTIES - TRUST ACCOUNT

Correspondent's charges 1 890,00 Cash - deposit 2 000,00

Cheque - self 110,00
R2 000,00 R2 000,00

CORRESPONDENT - TRUST ACCOUNT

Cheque self 1 320,00 Seminar Properties 1 890,00

Transfer to business 570,00
R1 890,00 R1 890,00

CORRESPONDENT - BUSINESS ACCOUNT

One third fees R570,00 Transfer from trust R570,00

FEES ACCOUNT

Correspondent R500,00

VAT ACCOUNT

Correspondent R70,00

BUSINESS CASH BOOK

Transfer from trust R570,00

TRUST JOURNAL
Seminar Properties (T)
1
890
Correspondent (T) 1 890
Correspondent's fees R1 710
and revenue stamps disbursed
R180 - registration of company

FEES JOURNAL
Correspondent (B)

570
Fees 500
VAT output 70
One third fee allowance due on
registration of company for
seminar Properties (Pty) Ltd

TRANSFER JOURNAL
Correspondent (T)

570
Correspondent (B) 570
Transfer fees on registration
of company Seminar Properties (Pty) Ltd
 SUGGESTED SOLUTION TO QUESTION 7.2
Page 2 of 2 pages

ACCOUNTING STATEMENT TO SEMINAR PROPERTIES

R R
Deposit received 2 000,00
Paid correspondent's charges on behalf for
registration of company - Seminar Properties (Pty) Ltd 1
890,00

Cheque refund herewith

11
0,00
2 000,00 2 000,00
 SUGGESTED SOLUTION TO QUESTION 7.3
Page 1 of 2 pages

Trust Cash Book

Joseph and Fin 1 225,00 Business Bank 80,00

Impala Garage 480,00
Gama Ranch

R1 225,00

565,00
Joseph and Fine 100,00
R1 225,00

Joseph and Fine - Trust Account

Impala Garage 600,00 Cash - Self 1 225,00

Game Ranch 750,00 Sundry disbursement 305,00
Transfer to Business 80,00
Cash self 100,00
R1 530,00 R1 530,00

Impala Garage - Trust Account

Correspondence. F & D 120,00 Cash - J Adams 600,00

Cash self 480,00
R600,00 R600,00

Game Ranch - Trust Account

Corresp. F & D 185,00 Cash - D Rossouw 750,00

Cash self 565,00
R750,00 R750,00

Joseph and Fine - Business Account

Fees R80,00 Transfer ex Trust R80,00

Fees

Transfer ex Trust R80,00

Business Cash Book

Trust Bank R80,00

 SUGGESTED SOLUTION TO QUESTION 7.3
Page 2 of 2 pages

DR
CR
TRUST JOURNAL Joseph and Fine (T) 600,00

Impala Garage (T) 600,00

Transfer cash collected from
J Adams per statement.......

Joseph and Fine (T) 750,00

Game Ranch (T) 750,00

Transfer cash collected from
D Rossouw per statement.....

Impala Garage (T) 120,00

Game Ranch (T) 185,00

Joseph and Fine (T) 305,00
Fees and disbursements as per statement....

FEE JOURNAL Joseph and Fine (B) 80,00

Fees allowances in various matters 80,00

per statement.....

TRANSFER Joseph and Fine (T) 80,00

JOURNAL Joseph and Fine (B) 80,00
Transfer fees due
 SUGGESTED SOLUTION TO QUESTION 7.4
Page 1 of 2 pages
TRUST JOURNAL

DR Correspondent (T) 2 000,00

CR Joe Soap (T) 2 000,00
Being amount collected

DR Joe Soap (T) 547,20

CR Corresondent (T) 547,20
Being fees and collection charges

DR Joe Soap (T) 456,00

CR Correspondent (T) 456,00
Being counsels fees

FEES JOURNAL

DR Correspondent (B) 182,40

CR Fees 160,00
VAT 22,40
Being 1/3 allowance in collection matter

DR Joe Soap (B) 285,00

CR Fees 250,00
VAT 35,00
Being our fees in collection matter and divorce

TRANSFER JOURNAL

DR Joe Soap (T) 285,00

CR Joe Soap (B) 285,00
Transfer of fees debited.

DR Correspondent (T) 182,40

CR Correspondent (B) 182,40
Transfer of fees debited

TRUST CASH BOOK

Correspondent 1 179,20 Bus Bank 467,40

Joe Soap 711,80
R1 179,20 R1 179,20

JOE SOAP TRUST A/C

Correspondent 547,20 Correspondent 2 000,00

Correspondent 456,00
Joe Soap 285,00
Trust Bank 711,80
R2 000,00 R2 000,00

CORRESPONDENT TRUST A/C

Joe Soap 2 000,00 Trust Bank 1 179,20

Correspondent 182,40 Joe Soap 547,20
Joe Soap 456,00
R2 182,40 R2 182,40

BUSINESS CASH BOOK

Trust Bank 467,40

 SUGGESTED SOLUTION TO QUESTION 7.4
Page 2 of 2 pages

JOE SOAP BUS A/C

Fees R285,00 Joe Soap Trust R285,00

CORRESPONDENT BUS A/C

Fees R182,40 Correspondent Trust R182,40

FEES

Correspondent 160,00
Joe Soap 250,00

VAT A/C

Correspondent 22,40
Joe Soap 35,00
 SUGGESTED SOLUTION TO QUESTION 7.5
Page 1 of 2 pages

PART 1
TRUST CASH BOOK

Jan de Beer 1 200,00 Bus Bank A/C 338,20

Correspondent 839,00
R1 200,00 R1 200,00

CORRESPONDENT TRUST A/C

Correspondent (B) 338,20 Trust cash book 1 200,00

Trust Cash Book 861,80
R1 200,00 R1 200,00

BUSINESS CASH BOOK

338,20 Tracing agent 57,00

CORRESPONDENT BUS A/C

Fees 114,00 Fees 38,00

Fees 171,00 Fees 57,00
Fees 136,80 Fees 45,60
Tracing agent 57,00 Correspondent (B) 338,20
R 478,80 R 478,80

FEES

Correspondent (B) 33,33 Correspondent (B) 100,00

Correspondent (B) 50,00 Correspondent (B) 150,00
Correspondent (B) 40,00 Correspondent (B) 120,00

VAT A/C

Correspondent (B) 4,67 Correspondent (B) 14,00

Correspondent (B) 7,00 Correspondent (B) 21,00
Correspondent (B) 5,60 Correspondent (B) 16,80
 SUGGESTED SOLUTION TO QUESTION 7.5
Page 2 of 2 pages

FEE JOURNAL R R

DR Correspondent (B) 114,00

CR Fees 100,00
CR VAT 14,00
Instruction fees

DR Fees 33,33
DR VAT 4,67
CR Correspondent (B) 38,00
1/3 Allowance in above matter

DR Correspondent (B) 171,00

CR Fees 150,00
CR VAT 21,00
Summons fees

DR Fees 50,00
DR VAT 7,00
CR Correspondents (B) 57,00
1/3 Allowance Summons fees

DR Correspondent (B) 136,80

CR Fees 120,00
CR VAT 16,80
Collection Commission

DR Fees 40,00
DR VAT 5,60
CR Correspondent (B) 45,60
1/3 Allowance on collection commission

TRANSFER JOURNAL

DR Correspondent (T) 338,20

CR Correspondent (B) 338,20
Transfer fees and disbursements

PART 2

STATEMENT OF ACCOUNT IN RESPECT OF COLLECTION JAN

DE BEER
1 200,00
Amount collected 114,00
Instruction fees 57,00
Tracing agent 171,00
Summons fees 136,80
Collection commission 721,20
Cheque enclosed 1 200,00 1 200,00

PART 3
861,80
Cheque sent to instructing attorney 140,60
Less: Fees due to him 721,20
Cheque sent to Leons Discount House
 SUGGESTED SOLUTION TO QUESTION 7.6
1 Page only
PART 1

TRUST BOOKS

TRUST BANK ACCOUNT

Correspondent (T) 4 000 Business bank account 484,50

Correspondent (T) 3 515,50

CORRESPONDENT (T)

Trust bank account 484,50 Trust bank account 4 000,00

Trust bank account 3 515,50
R4 000,00 R4 000,00

BUSINESS BOOKS
CORRESPONDENT (B)

Business bank account 142,50 Correspondent (T) 484,50

Fees/ VAT 513,00 Fees/ VAT 171,00
R655,50 R655,50

FEE ACCOUNT

Correspondent (B) 150,00 Correspondent (B) 450,00

VAT ACCOUNT

Correspondent (B) 21,00 Correspondent (B) 63,00

BUSINESS BANK ACCOUNT

Trust bank account 484,50 Correspondent (B) -

Tracing agent 142,50

PART 2

Durban attorney would send their client R3 515,50 less R171,00 = R3 344,50.
 SUGGESTED SOLUTION TO QUESTION 7.7
Page 1 of 2 pages
PART 1

Fee Journal

Debit Correspondent business account 1 026

Credit Fees 900
Vat account 126

Fees in respect of summons

Debit Fees 300

Vat account 42
Credit Correspondent business account 342

1/3 allowance to instructing attorney

Debit Correspondent business account 2 280

Credit Fees 2 000
Vat account 280

5% collection commission on R40 000

Debit Fees 667

Vat account 93
Credit Correspondent business account 760

1/3 allowance to instructing attorney

Transfer Journal

Debit Correspondent trust account 2 204

Credit Correspondent business account 2 204

Trust Books

Correspondent trust account

Correspondent (B) 2 204 Bank account 41 266

Trust bank 240
Trust bank 38 822
R41 266 R41 266

Trust bank account

Correspondent (T) 41 266 Bus bank 2 204

Correspondent (T) 240
Correspondent (T) 38 822

Business books

Correspondent business account

Fees/Vat 1 026 Fees/Vat 342

Fees/Vat 2 280 Fees/Vat 760
Correspondent (T) 2 204
R3 306 R3 306
 SUGGESTED SOLUTION TO QUESTION 7.7
Page 2 of 2 pages

Business bank account

Trust bank 2 204

Fees

Correspondent 300 Correspondent (B) 900

Correspondent 667 Correspondent (B) 2 000

Vat

Correspondent 42 Correspondent (B) 126

Correspondent 93 Correspondent (B) 280

PART 2

Accounting Statement

Cash collected 41 266

Summons fees (incl. Vat) 1 026

Your 1/3 allowance (incl. Vat) 342

Paid Sheriffs charges 240

Collection commission (incl. Vat) 2 280
Your 1/3 allowance (incl. Vat) 760

Cheque herewith 38 822

R42 368 R42 368

PART 3

Accounting Statement

Cash collected 41 266

Summons fees 900

Vat thereon 126
Sheriffs charges 240
Collection commission 2 000
Vat thereon 280
Cheque herewith 37 720
R41 266 R41 266
 SUGGESTED SOLUTION TO QUESTION 7.8
Page 1 of 2 pages

PART 1

TRUST JOURNAL

DR Correspondent (T)
20
000,00
CR Slow Joe (T) 20 000,00

DR Slow Joe (T)

2 406,00
CR Correspondent (T) 2 406,00
Being fees disbursements and collection charges

FEES JOURNAL

DR Correspondent (B) 722,00

CR Fees 633,33
VAT 88,67
Being 1/3 allowance in collection matter

DR Slow Joe (B) 342,00

CR Fees 300,00
VAT 42,00
Being our fees in collection matter

TRANSFER JOURNAL

DR Slow Joe (T) 342,00

CR Slow Joe (B) 342,00
Transfer of fees debited

DR Correspondent (T) 722,00

CR Correspondent (B) 722,00
Transfer of fees debited

TRUST CASH BOOK

Correspondent 18 316,00 Bus Bank 1 064,00

Slow Joe 17 252,00
R18 316,00 R18 316,00

SLOW JOE

Correspondent 2 406,00 Correspondent 20 000,00

Slow Joe (B) 342,00
Trust Bank 17 252,00
R20 000,00 R20 000,00

CORRESPONDENT TRUST A/C

Slow Joe 20 000,00 Trust Bank 18 316,00

Correspondent (B) 722,00 Slow Joe 2 406,00
R20 722,00 R20 722,00

BUSINESS CASH BOOK

Trust Bank 1 064,00

 SUGGESTED SOLUTION TO QUESTION 7.8
Page 2 of 2 pages

SLOW JOE BUS A/C

Fees R342,00 Slow Joe Trust R342,00

CORRESPONDENT BUS A/C

Fees R722,00 Correspondent Trust R722,00

FEES

Correspondent 633,33
Joe Soap 300,00

VAT A/C

Correspondent 88,67
Joe Soap 42,00

PART 2
TRUST CASH BOOK

Correspondent (T) 20 000,00 Business Bank A/C 1 684,00

Correspondent (T) 18 316,00
R20 000,00 R20 000,00

CORRESPONDENT TRUST A/C

Correspondent (B) 1 684,00 Trust Bank 20 000,00

Trust Bank Account 18 316,00
R20 000,00 R20 000,00

CORRESPONDENT BUS A/C

Fees/ Disbursements/ VAT 2 406,00 Fees/ VAT 722,00

Correspondent (T) 1 684,00
R2 406,00 R2 406,00

BUSINESS CASH BOOK

Trust Bank A/C 1 684,00 Sheriff's fees 240,00

FEES A/C

Correspondent (B) 633,33 Correspondent (B) 1 900,00

VAT A/C

Correspondent (B) 88,67 Correspondent (B) 266,00

SHERIFF FEES

Bus bank account R240,00 Correspondent (B) R240,00

 SUGGESTED SOLUTION TO QUESTION 7.9
Page 1 of 2 pages

PART 1

Trust Journal

DR Colin Smith Incorporated (T) 14 000

CR Mr Payne (T) 14 000
Money collected

DR Mr Payne (T) 3 762

CR Colin Smith Incorporated (T) 3 762
Fees and disbursements

Fee Journal

DR Colin Smith Incorporated (B) 684

CR Fees 600
VAT 84
Our one third allowance

Transfer Journal

DR Colin Smith Incorporated (T) 684

CR Colin Smith Incorporated (B) 684
Transfer of fees due

Ledger Accounts
Trust bank account

Colin Smith Inc 19 022 Bus bank account 684

Mr Payne 10 238
Colin Smith Incorp (T) 8 100

Colin Smith Incorporated (T)

Mr Payne 14 000 Trust bank account 19 022

Colin Smith Inc (B) 684 Mr Payne 3 762
Trust bank account 8 100
R22 784 R22 784

Mr Payne (T)

Colin Smith Incorporated 3 762 Colin Smith Incorporated 14 000

Trust bank account 10 238
R14 000 R14 000

Business Bank Account

Trust bank account 684

Colin Smith Incorporated (B)

Fees/ VAT R684 Colin Smith Inc. (T) R684

 SUGGESTED SOLUTION TO QUESTION 7.9
Page 2 of 2 pages

Fees

Colin Smith Incorporated (B) 600

VAT

Colin Smith Incorporated (B) 84

PART 2

Trust Bank Account

Correspondent (T) 14 000 Correspondent (T) 19 022

Correspondent (T) 8 100 Bus bank 3 078

Correspondent (T)

Trustbank 19 022 Trust bank account 14 000

Correspondent (B) 3 078 Trust bank account 8 100
R22 100 R22 100

Business Bank

Trustbank 3 078 Counsels fees 1 710

Correspondent (B)

Bus bank 1 710 Correspondent (T) 3 078

Fees/ VAT 1 368
R3 078 R3 078

Fees

Correspondent (B) 1 200

VAT

Correspondent (B) 168

 SUGGESTED SOLUTION TO QUESTION 7.10
Page 1 of 2 pages

PART 1

LEDGER ACCOUNTS

Trust Bank Account

Correpondent (T) 5 628,60 Micheal Botha (T) 5 214,40

Bus bank account 414,20

Correspondent Trust Account

Micheal Botha (T) 6 400,00 Trust bank account 5 628,60

Correspondent (B) 243,20 Micheal Botha (T) 1 014,60
R6 643,20 R6 643,20

Micheal Botha Trust Account

Correspondent (T) 1 014,60 Correspondent (T) 6 400,00

Trust bank account 5 214,40
Micheal Botha (B) 171,00
R6 400,00 R6 400,00

Business Bank Account

Trust bank account 414,20

Correspondent Business Account

Fees/ Vat R243,20 Correspondent (T) R243,20

Michael Botha Business Account

Fees/ Vat R171,00 Micheal Botha (T) R171,00

Fees

Correspondent (B) 213,33

Micheal Botha (B) 150,00

VAT

Correspondent (B) 29,87

Micheal Botha (B) 21,00
 SUGGESTED SOLUTION TO QUESTION 7.10
Page 2 of 2 pages

TRUST JOURNAL DR CR

Correspondent (T) 6 400,00

Micheal Botha (T) 6 400,00
Money collected by correspondent

Micheal Botha (T) 1 014,60

Correspondent (T) 1 014,60
Disbursements and fees

FEE JOURNAL

Correspondent (B) 243,20

Fees 213,33
VAT 29,87

Micheal Botha (B) 171,00

Fees 150,00
VAT 21,00

TRANSFER JOURNAL

Correspondent (T) 243,20

Correspondent (B) 243,20
Micheal Botha (T) 171,00
Micheal Botha (B) 171,00
R414,20 R414,20

PART 2
Accounting statement to Micheal Botha
R R
Re: Collection Jan Huiseman
Cash received 6 400,00
Correspondent - charges (including VAT) 729,60
disbursements (including VAT) 285,00
Our fees (including VAT) 171,00
Cheque herewith 5 214,40
6 400,00 6 400,00
 SUGGESTED SOLUTION TO QUESTION 7.11
Page 1 of 2 pages

PART 1

Trust Bank Account

Bright & Co. 2 738 Rosen (T) 1 047
Business bank account 1 691

Rosen (T) - Collection

Bright & Co. 1 953 Bright & Co. (T) 3 000
Trustbank account 1 047
R3 000 R3 000

Rosen (T) – Transfer

Bright and Co 14 500 Bright and Co (T) 314 500
Bright and Co 300 000
R314 500 R314 500

Bright and Co (T)

Rosen (T) 3 000 Trust bank account 2 738
Rosen (T) 314 500 Rosen (T) 1 953
Bright & Co (B) 1 691 Rosen (T) 14 500
Rosen (T) 300 000
R319 191 R319 191

Business Bank Account

Trust bank account 1 691

Bright & Co (B)

Fees/ VAT 551 Bright & Co (T) 1 691
Fees/ VAT 1 140
R1 691 R1 691

Fees
Bright & Co 483
Bright & Co 1 000

VAT
Bright & Co 68
Bright & Co 140
 SUGGESTED SOLUTION TO QUESTION 7.11
Page 2 of 2 pages

Trust Journal
DR Rosen (T) 1 953
CR Bright & Co (T) 1 953
Fees and disbursements

DR Rosen (T) 314 500

CR Bright & Co (T) 314 500
Fees and disbursements

DR Bright & Co (T) 3 000

CR Rosen (T) 3 000
Cash recovered from Armstrong

DR Rosen (T) 300 000

CR Bright & Co 300 000
Disbursement of purchase price

Fee Journal
DR Bright & Co (B) 551
CR Fees 483
CR VAT 68

DR Bright & Co 1 140

CR Fees 1 000
CR VAT 140

Transfer Journal
DR Bright and Co (T) 1 691
CR Bright & Co (B) 1 691

PART 2

Amount received from correspondent 2 738

Less: 1/3 allowance fees and VAT (551 + 1 140) 1 691
Cheque to client 1 047
 SUGGESTED SOLUTION TO QUESTION 7.13
Page 1 of 2 pages

PART 1

TRUST LEDGER ACCOUNTS

Trust bank account

Correspondent (T) 20 000Business bank 3 476
Correspondent 16 524

Correspondent (T)
Correspondent (B) 3 476Trust bank account 20 000
Trust bank account 16 524

BUSINESS LEDGER ACCOUNTS

Business bank
Trust bank 3 476 Correspondent (B) 1 500

Correspondent (B)
Business bank 1 500Fees/ VAT 228
Fees/ VAT 684 Fees/ VAT 760
Fees/ VAT 2 280 Correspondent (T) 3 476
R4 464 R4 464

Fees
Correspondent (B) 200Correspondent (B) 600
Correspondent (B) 667Correspondent (B) 2 000

VAT
Correspondent (B) 28Correspondent (B) 84
Correspondent (B) 93Correspondent (B) 280

FEE JOURNAL

DR Correspondent (B) 684

CR Fees 600
CR VAT 84

DR Fees 200
VAT 28
CR Correspondent (B) 228

DR Correspondent (B) 2 280

CR Fees 2 000
VAT 280

DR Fees 667
VAT 93
CR Correspondent (B) 760

TRANSFER JOURNAL

DR Correspondent (T) 3 476

CR Correspondent (B) 3 476
 SUGGESTED SOLUTION TO QUESTION 7.13
Page 2 of 2 pages

PART 2

ACCOUNTING STATEMENT

Money collected 20 000

Instruction fee (including VAT) 684 228
Tracing agent 1 500
Collection fee (including VAT) 2 280 760
Cheque enclosed 16 524
R20 988 R20 988

PART 3

TRUST LEDGER ACCOUNTS

Trust bank account

Correspondent (T) 16 524 Business bank account 988
Cassim (T) 15 536
R16 524 R16 524

Correspondent (T)
Cassim (T) 20 000 Trust bank account 16 524
Correspondent (B) 988 Cassim (T) 4 464
R20 988 R20 988

Cassim (T)
Correspondent (T) 4 464 Correspondent (T) 20 000
Trust bank account 15 536
R20 000 R20 000

BUSINESS LEDGER ACCOUNTS

Business bank account

Trust bank account 988

Correspondent (B)
Fees/ VAT 988 Correspondent (T) 988

Fees
Fees 867

VAT
VAT 121