Prime entry books – Revision 2022

01.Uditha had commenced a business of whole sale distribution of stationery items with the name of
“Medawaththa Traders” as at 01.01.2021. He invested 1 250 000 in cash, 50 000 worth furniture and Rs. 4 500
000 worth delivery van as initial capital

1. Following are the details of sales for the January month

a) Credit Sales
Date Organization Value (Rs.) Invoice Number
2021/01/06 Sammani Book shop 170 000 001
2021/01/10 Sri Devi Book shop 250 000 002
2021/01/12 Sarathi Book shop 100 000 003
2021/01/20 Senani Book shop 150 000 004

b) Cash sales
Date Organization Value (Rs.) Cash receipt Number
2021/01/03 Gamage Traders 20 000 010020
2021/01/07 Ranasinghe Trade Center 30 000 010021
2021/01/13 Jayawardana Traders 40 000 010022
2021/01/28 Kannagara Traders 25 000 010026

2. Details of return inwards items

Date Organization Value (Rs.) Credit note
number
2021/01/10 Sammani Book shop 10 000 0025
2021/01/15 Sarath Book shop 5 000 0026
2021/01/28 Senani Book shop 20 000 0027

3. Details of debtors settlements

Date Organization Amount paid after Discount Cash receipt
deducting the Allowed number
discount (Rs.) %
2021/01/18 Sammani Book shop 152 000 5% 010023
2021/01/20 Sri Devi Book shop 237 500 5% 010024
2021/01/28 Sarath Book shop 10 000 - 010025
2021/01/30 Senani Book shop 50 000 - 010027

4. Stocks worth of Rs. 90 000 purchased on 02.01. 2021 from “Richard Trading Limited” Rs. 10 000 paid on
same date and (Payment voucher number 001001) the rest was agreed to pay later (invoice number 007653)

In settlement the business was offered 10% discount from Richard Trading Limited, if the debt is settled fully
within a month.

The payment was done after deducting the respective discount on 29th January (payment voucher No 001004)

5. Done following expenses on 25th January

Electricity bills Rs. 4 000 (Payment voucher no 001002)
Telephone bills Rs. 3 000 (Payment voucher no 001003)
6. Purchased Rs. 45 000 worth computer from “Singer Limited” on credit
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You are required to prepare following:
1. Cash receipt journal & cash payment Journal
2. Sales and return inwards journal
3. Relevant ledger accounts in the general ledger and subsidiary ledger
4. Trial balance as at 31.01.2021
(Total 20 Marks)
02.The ledger account balances of Akbar‟s Business as at 01.08.2021 and the transactions occurred during the
month of august have given below:

(i) Balances as at 01.08.2021

Description Rs. ‘000
Land and Building 12 500
Motor Vehicle 1 100
Equipment 500
Debtor - Ranga 250
Debtor - Suranga 125
Inventories 75
Investments 150
Petty Cash 15
Bank overdraft 10
Bank loan 200
Creditor - Amara 15
Creditor - Pala 30

(ii) Transactions and events occurred during the month of August 2021

Date Source Document No Transaction/Event

01/08 Voucher No: 001 Purchase Rs. 15 400 stocks (including 10% VAT) -
Cheque No: 0112563
02/08 Receipt No: 003 Rs. 150 000 cash has invested by the owner
05/08 Receipt No: 004 Sold inventories for the invoice price of
Rs. 77 000 (including 10%)
10/08 Purchase goods on credit (including 10% VAT)
Invoice No: 001 Amara - Rs. 110 000
Invoice No: 002 Pala - Rs. 330 000
Invoice No: 003 Vasantha – Rs. 11 000
12/08 Debit No: 10 & 11 Goods returns due to incorrect sizes (including VAT)
Amara - Rs. 11 000
Pala - Rs. 55 000
15/08 Petty Cash Payments
Petty Cash Voucher No: 004 Entertainment expenses Rs. 1 250
Petty Cash Voucher No: 005 Transport Expenses Rs. 2 500
Petty Cash Voucher No: 006 Stationery Expenses Rs. 2 000
Petty Cash Voucher No: 007 Toner for computer Rs. 1 200
Petty Cash Voucher No: 008 Other expenses Rs. 950
Petty Cash Voucher No: 009 Owner‟s Expenses Rs. 1 050

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 Date Source Document No Transaction/Event

16/08 Receipt No: 005 Cash Sales Rs. 100 000 (VAT free)
20/08 Voucher No: 002 Paid fully and settle Amara - Cheque No: 0112564
received discount was Rs. 2 000
Voucher No: 003 Paid Vasantha to settle half of his amount Cheque No:
0112565
22/08 Purchases Rs. 225 000 equipment for business use from
Exsa Marketing on credit
23/08 The cheque issued to Vasantha has dishonoured
24/08 Credit sales(including 10%VAT)
Invoice No: 004 Suranga - Rs. 77 000
Invoice No: 005 Sumana - Rs. 121 000
Invoice No: 006 Ranga – Rs. 110 000
25/08 Sales returns due to damages (including VAT)
Credit No: 007 Suranga - Rs. 5 000
Credit No: 008 Sumana - Rs. 22 000
26/08 Voucher No: 004 Paid telephone bill Rs. 5 500 Cheque No: 0112566
27/08 Receipt No: 006 Suranga settle his amount of debt and business allowed
him Rs. 3 000 discount
30/08 Voucher No: 005 Issued a cheque No: 0112567 to reimburse the petty
cash imprest

Required:
i. Record the above transactions and events in relevant prime entry books of Akbar‟s
Business
ii. Post these transactions to the general ledger
iii. Prepare debtors and creditors list in the subsidiary ledgers

03. Details about Tharupabha Trader for the month of April 2018 are given below.

Cash Payment Journal

Date DetailsCheque Discount Amount Analysis Column

No allowed Cash Receipts Income
Sales from
debtors
2018.04.02 Kusal 20947 2 000 78 000 78 000
2018.04.03 Sales 510302 40 000 40 000
2018.04.05 Vihan 201322 50 000 50 000
2018.04.09 Baratha 208480 4 000 116 000 116 000
2018.04.15 Commission 402899 30 000 30 000
2018.04.30 Sales 702651 70 000 70 000
6 000 384 000 110 000 244 000 30 000

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 Cash Payment Journal
Date Details Cheque Discount Amount Analysis Column
No allowed Cash Payment Expenses Other
Purchased to credit
2018.04.03 Purchases 824634 46 000 46 000
2018.04.04 Sirimath 824635 1 000 49 000 49 000
2018.04.05 Drawings 824636 18 000 18 000
2018.04.10 Furniture 824637 2 000 200 000 200 000
2018.04.15 Suranga 824638 78 000 78 000
2018.04.25 Wages 824639 50 000 50 000
2018.04.30 Standing 10 000 10 000
orders
Insurance 3 000 451 000 46 000 127 000 60 000 218 000

The bank statement for the month of April 2018 is as follows:-

Date Details Debit Credit Balance

2018.04.01 Balance 180 000 130 000
2018.04.04 209470 78 000 208 000
2018.04.04 824634 46 000 162 000
2018.04.05 824633 16 000 146 000
2018.04.05 824636 18 000 128 000
2018.04.05 510302 40 000 168 000
2018.04.08 824635 49 000 119 000
2018.04.08 201322 50 000 169 000
2018.04.12 208480 116 000 285 000
2018.04.12 824637 200 000 85 000
2018.04.19 402899 30 000 115 000
2018.04.22 Dishonored 402899 30 000 85 000
2018.04.25 824639 50 000 35 000
2018.04.30 Cheque Book charges 2 000 33 000
2018.04.30 Standing orders insurance 10 000 23 000
2018.04.30 Credit transfers Fixed deposits interest 120 000 11 000

Additional Information:
1. The balances of the cash control account and the of the bank statement as the 01.04.2018 were not
agreed. The reason for this was un-presented cheques below:
Cheque Number Amount
524531 - 32 000
524523 - 16 000

2. Dishonoured cheque charges and the interest on fixed deposits were not recorded in the cash control
account until the bank statement is received from April 2018.
3. Purchase of furniture and equipment are recorded in the cash control account as Rs. 20 000.

Required:
1. Cash control account before business received bank statement for the month of April
2. Adjusted the cash control

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04.The debit balance of the bank statement for t he month ended October 2021 sent by Sampath Bank
to Sanjali‟s Business was Rs. 55 000. It was not tally with the cash control account due to the
following reasons.
i. The cash control account balance has been over casted by Rs. 5 000
ii. The total of cash receipt journal Rs. 15 000 has been posted to the cash control account as
Rs. 1 500
iii. The following issued cheques to the creditors have not been presented to the bank till 31 st
October
Cheque Number Amount (Rs.)
0112656 15 000
0112657 8 500
iv. The total of Rs. 3 000 in the discount received column in the cash payments journal has been
debited to cash control account and correctly recorded in the creditor control account.
v. The deposited cheque Rs. 10 000 which was received from a debtor has not been realized
vi. The bank charges of Rs. 1 000 and he standing order payment for insurance premium of
Rs. 1 500 have not been recorded in the cash control account.

Required:
i. Cash control account balance before adjusting
ii. Adjusted cash control account
iii. Bank Reconciliation Statement for the month of October
(10 Marks)

05. Sasmanmal Trades cash control account balance on 31.03.2021 amounted to Rs. 28 000 and did not agree
with the bank statement balance as at that date. Subsequently following errors and omissions were found
out.
i. A cheque issued on 18th March Rs. 8 650 was recorded in cash payment journal total column as
6 850 but correctly recorded in the analysis column
ii. Standing orders paid by the bank 8 500 rates and 750 bank charges were not recorded in
payment journal
iii. Out of the total cheques issued in March two cheques amounting to 2 800 and 2 350 were not
presented for payments
iv. Two cheques from the deposited cheques for 8 500 and 5 200 had not been realized yet.
v. 8 100 investment income collected by the bank has not recorded in business cash control
account.
vi. A deposited cheque of 15 500 was dishonored but not entered in the cash control account
vii. Two cheques issued in February in amounting to Rs. 2 850 and Rs. 3 500 were not presented for
payments in February. But as per the bank statement for march Rs. 2 850 cheque was presented
for payment
Required:
i. Adjusted cash control account
ii. Prepare the bank reconciliation statement based on adjusted cash control balance

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06.The following transactions related to bank account were extracted from the books of Ranasura Ltd
for the months of April and May
1. Balance as per the bank account as at 01.04.2021 Rs. 800 000
Balance as per the bank statement as at 01.04.2021 Rs. 800 000
There were no un presented cheques or un realized cheques as at 01.04.2021

April May
Rs. „000 Rs. „000
2. Cheques deposited in the bank as per the bank account
of the business 2 400 3 000
Cheques issued during the month as per the bank Account 1 800 1 600
Realized cheques (excluding the dishonoured cheques) 2 000 2 800
Cheques presented for payments 1 400 1 200

Unpresented cheques as at 31.04.2021 were presented for payments during the month of May
2021 and un-realized cheques as at 30.4.2021 were realized during the month of May 2021.

3. The following transactions appeared in the bank statements as at 30.04.2021 and 31.05.2021 have
not been recorded to the bank account of the business
As at 30.04.2021 As at 31.05.2021
Direct remittance 160 000 120 000
Dishonored cheques received from debtors 100 000 60 000
Bank charges 40 000 20 000

4. Only the above transactions were took place relevant to the bank account during the months of April
and May.

Required:
(1) Balance as per the bank statement as at 30.04.2021
(2) Balance to be shown in the statement of financial position as at 31.05.2021
(3) Bank reconciliation statement as at 31.05.2021

07. Dhinu traders is registered for value added tax (VAT) and summary of the transactions took place during the
month of January 2018 as follows:
i.
Cash Receipts Journal
Analysis Columns
Receipt
Date Details C/N D/A Amount Sales Debtors VAT Other
No
Income
25 000 720 000 450 000 150 000 67 500 52 500

ii.
Cash Payment Journal
Voucher Analysis Columns
Date Details C/N D/R Amount
No Purchase Creditors VAT Expenses
20 000 447 500 250 000 120 000 37 500 40 000

iii. Total of other Journals

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 Prime entry book VAT (Excluded) VAT VAT (Included)
Purchase Journal 300 000 45 000 345 000
Sales Journal 450 000 67 500 517 500
Purchase return Journal 20 000 3 000 23 000
Sales return journal 30 000 4 500 34 500

Additional Information:
The balances of the debtors control account as 1st January Rs. 500 000 creditors control account
Rs. 200 000 and the cash control account Rs. 100 000

Required:
Following ledger accounts in the general ledger Expense account
Cash control account Discount allowed account
VAT control account Sales account
Income account Purchase account
Debtors control account Discount received account
Creditors control account

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