the cost of sales account and the inventory account. You will learn more about the topic in learning unit 6 and 7.) The following transactions were entered into by Prof Plumbers during June 2021: June 3 Prof Plumbers purchased furniture for cash - R20 000. 9 Inventory was purchased on credit from a supplier - R10 000. 16 The telephone expenses for the month was paid with an electronic funds transfer - R6 000. 20 Received money for plumbing services rendered for cash - R5 000. 23 Sold inventory on credit to a debtor - R3 000. The cost price of the inventory - R2 000. 28 The owner transferred money from the entity's bank account to his personal bank account - R15.000. Required: For each of the transactions listed above, Indicate the effect of the transaction on the accounting equation. Use a "+" sign to Indicate an increase and a "-" sign to Indicate a decrease in the elements of the accounting equation. Also indicate the General Ledger Accounts affected. Where applicable assume that the bank balance is positive. Example: The owner transferred R100 000 to the entity's bank account from his personal bank account.
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* **Assets:** Furniture (+R20 000), Cash (-R20 000) * **General Ledger Accounts:** Furniture, Cash **June 9** Inventory was purchased on credit from a supplier - R10 000. * **Assets:** Inventory (+R10 000) * **Liabilities:** Accounts Payable (+R10 000) * **General Show more…
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All goods (trading stock as well as any other goods) exceeding N$8 500 are purchased on credit. Credit terms have been agreed by all suppliers. Purchases below the value of N$8 500 are paid immediately. Assume that the bank has a favourable bank balance. The following transactions took place during June 2021: 1. Shikongo increased his capital contribution from N$50 000 to N$150 000 2. Bought machinery on credit from Damara for N$81 235 3. Transferred N$250 from FNB account to the municipality for a trade licence 4. Bought a laptop from Matrix for N$7 999. 5. Purchased stationery and cartridges from CAN for N$2 180. 6. Bought merchandise from Woreman Hyper, N$6 513. 7. Cash sales of goods, N$18 176. 8. Merchandise sold on credit to G Herero, N$5 250. 9. Paid the telephone account, N$3 506. 10. Purchased delivery scooter from Select Cars, N$30 599. 11. Transferred N$2 605 to Oshiwambo, being the instalment on their account. 12. Paid salaries for the month, N$7 500. Required: Analyse the transactions above for ITCL CC for June 2023 in the accounting equation by using the table below. Example: ITCL CC pays the local newspaper for the sales advertisement placed in the local community brochure - N$1 650.
Akash M.
QUESTION 1 ACCOUNTING EQUATION: INCLUDING VAT The following are miscellaneous transactions for Simvox for April 2021. The business is a registered VAT vendor and trades only with registered VAT vendors who can provide tax invoices. The business charges 15 % VAT on all its sales. All amounts are inclusive of VAT unless VAT is not applicable. The business uses the perpetual inventory method. The business makes use of separate VAT input and VAT output accounts. Date | Details of transaction | Amount (R) 1 | The owner, V.Torge, contributed cash to the business. | 925 500.00 9 | Cash sale of trading inventory with a selling price (marked price) of R 228 297.71. The mark-up on the inventory was 71% of the cost price. | ? 14 | Received service income for the month in cash. | 4 150.87 15 | The owner, V.Torge, contributed his personal vehicle to the business. All legislative requirements have been met for the full VAT amount to be deducted. | 87 274.65 17 | Sold trading inventory with a selling price (marked price) of R 39 337.45 on credit to T.Abrahams. The mark-up on the inventory was 50% of the cost price. | ? 18 | Trading inventory with a selling price (marked price) of R 4 327.12 returned by T.Abrahams. | ? 18 | T.Abrahams settled the account in full less a 10% settlement discount. The debtors list showed a balance of R 197 898.33 prior to this account settlement. | ? 21 | The owner, V.Torge, took cash from the safe. | 4 164.75 24 | Sold trading inventory with a selling price (marked price) of R 30 596.33 on credit to S.Pandor. The mark-up on the inventory was 50% of the selling price (i.e the gross margin is 50%). | ? 25 | S.Pandor has been declared insolvent and the debt is to be written off as irrecoverable. The debtors list showed a balance of R 172 568.03 prior to this transaction. | ? 28 | Received dividend income for the month in cash. | 46 275.00 Required: Show how the above transactions will affect the accounting equation and enter how the accounts in the general ledger will be affected. See the example below. Example: Received a mortgage loan of R 200 000.00 in the form of cash: No. | Assets (R) | = Owner's equity (R) | + Liabilities (R) e.g. | + 200 000.00 | | + 200 000.00 | Dr Bank | | Cr Mortgage loan
Recommended Textbooks
Horngren’s Cost Accounting
Cost Accounting A Managerial Emphasis
Principles of Accounting Volume 1: Financial Accounting
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