Manual Bookeeping

     15 July     Credit Note No 129                £15 plus VAT at 17.5%

     20 July     Cheque payment received        £345.67

     Section 2 – Ledgers

     Starting on this page are all the account you will need to process  the various

     transactions required.  Enter the following into the relevant accounts. (NB There

     is no need to worry if the dates in the accounts are not in order.)

1. Post the details of four invoices from task 1 into the sales ledger accounts,

the sales account and the VAT account as relevant.

2. All but Mr and Mrs bagshott paid their invoices one week after these were

sent out and cheques were banked on receipt.  Post the receipts.

3. The opening balance on Bowles Supplies Account matches the opening

balance on the statement.  Process all the other details through the fixtures,

VAT and bank accounts as appropriate.

4. Process the following cheque payments into the bank account and the

ledger accounts overleaf.

4  August   SW Electricity   cheque no 567 for £528.75

                                             (£450.00 plus £78.75 VAT)   (electric/gas)

1  Sept       Caches Ltd         cheque no 568 for £205.62

                                             (£175.00 plus £30.62 VAT)   (cleaning supplies)

15 Sept      BT                      cheque no 569 for £176.25

                                             (£150 plus £26.25 VAT)        (telephone)

30 Sept      S Pinter              cheque no 570 £250                (wages)

30 Sept      Cash                   cheque no 571 £900                (drawings)

Sales Ledger

Mr and Mrs Poulter

Mr and Mrs Bagshott

Purchases Ledger

General Ledger

VAT Account

Fixtures Account

Cleaning Supplies

Telephone Account

Drawings Account

Capital Account

 Section 3 – Correction Of Errors

     On checking the accounts prior to taking our a trial balance, you find that an

     amount for wages, paid in June, was entered incorrectly into the accounts.  A

     figure of £250 had been debited to the wages account and credited to the bank

     account, but the figure actually paid was £290.  Post a further entry through

     the accounts to deal with the remaining £40.

     Section 4 – Trial Balance

     Balance all accounts on 30 September and take out a trial balance.

     Section 5 – Functions Of Banks

     Your receive the following cheque in the post on 2 October 2002.

     List all the reasons you can see which might invalidate this cheque from being

     paid into Mr and Mrs Daniels account.

        first oxford bank plc                  22-1  

        30 High Street        000345 61775432

        Oxford, OX1 1AA        Date__3 Jan 2002________

        Pay_The Beehive Cottage____________________________________

        __One hundred and forty three___________________£      153.58

                                                                                                                        8888888888 

        __pounds and 58p only_________________________

        _______________________                       ______ 9999999999_____________

                 6666666        -11-44                                                 61775432

(Colours below match the mistake shown above in the same colours.)

• Name of payee receiving payments is incorrect, should be Mr and Mrs Daniels not The Behive Cottage.
• The bank sort in the top right hand corner is missing 3 digits and the sort code on the bottom is missing 2 digits.
• The number of cheque issued is missing in the bottom left hand corner of the cheque.
• There is no signature to approve the cheque.
•  Just below the figure £153.58 there should be the name of the payee which is not shown.
• The amount to be paid in words does not match the amount to be paid in numbers.
• The date is very old since the cheque was in the post on the 2nd October 2002 and the date on the cheque is 3rd Jan 2002.  I think this would make it void because a cheque takes 7 days to clear from the date on the cheque, in this case it is 8 months to late.
• I think the name of the bank is incorrect should be The Oxford Bank plc and not first Oxford Bank plc.

You are informed that a customer is to be invoiced shortly for a total of

     £317.25 inc VAT.

     Calculate the Net value? ( X Percentage / 100 + %)

                                        17.5 / 117.50

                                        X 7 /47

• £317.25 * 7 =2220.75
• 2220.75 / 47 = 47.25
• 3317.25 + £47.25 = £ 364.50

 

     Calculate £2330 plus VAT at 17.5%

• £2330 * 7 = 16310
• 1630/47 = 347.0212 = 347.02
• £2330 + £347.02 = £2677.02

     

     Calculate the following VAT amounts at a rate of 17.5%

      £117.50 inc VAT         *) £117.50 * 7 = 822.50  822.50/47 = 17.50

  *) £117.50 + £17.50 = £135.00

      £670 exc VAT            *) £670 * 7 = 4690  4690/47 = 99.7872 = 99.78

 *) £670 - £99.78 = £570.22

      £2467.50 inc VAT       *) £2467.50 * 7 = 17272.50  17272.50/47 = 367.50

  *) £2467.50 + 367.50 =£2835.00

   

      What ledgers would be used for the following sales transaction and how

      much would be entered in to each ledger?

      An Invoice was sent to Mr. Jones for £1292.50 inc VAT

• VAT Account Ledger = £192.50
• Sales Ledger – Mr Jones = £1485
• Sales Account Ledger = £1292.50

      As a book-keeper list two reasons why it is vital that you keep all financial

     records secure.

• It is vital to keep all financial records secure to retain my own integrity and reputation. No one should be able to access them without my knowlege just in case they have ulterior motives - embezzlement, tax defrauding, etc.
• It is also vital to keep all records of financial transactions whether on paper or computer for tax record purposes, company accounts, to ensue that I  keep a proper level of liquidity, maintain a proper level of cash-flow, and ensue that solvency is maintained.