Accounting

Grade 8
Cash Transactions

Grade 8
9 780958 501743

Accounting Cash Transactions

Head, heart and hand series

RRP
Yvette Gietl
R 195
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God Bless You, ASSETS OWNER’S EQUITY LIABILITIES
Mrs G
NON CURRENT NON CURRENT
CAPITAL DRAWINGS
ASSETS LIABILITIES

LAND AND LONG TERM

INCOME EXPENSES
School: BUILDINGS LIABILITIES

EQUIPMENT SALES RENT EXPENSE MORTGAGE BOND

Learner Name:
WATER &
VEHICLES CURRENT INCOME LONG TERM LOAN
ELECTRICITY
Grade: Year:
OFFICE FURNITURE RENT INCOME DONATIONS CURRENT LIABILITIES

GENERAL LEDGER ACCOUNTS FIXED DEPOSIT INTEREST INCOME WAGES

SHORT TERM
LIABILITIES
A L I E CREDITORS
CURRENT ASSETS BAD DEBTS PACKAGING
CONTROL
+ - - + - + + - RECOVERED MATERIALS

BALANCE SHEET SECTION BANK DISCOUNT RECEIVED REPAIRS SHORT TERM LOAN
1
DR CAPITAL CR
DEBTORS CONTROL SALARIES BANK OVERDRAFT
+ Increase
CASH FLOAT COST OF SALES
2 DR DRAWINGS CR
+ Increase PETTY CASH LICENCES

3
DR A SSETS CR TRADING INVENTORY TELEPHONE

+ Increase - Decrease
DISCOUNT ALLOWED

4 DR L IABILITIES CR INSURANCE
- Decrease + Increase Grade 9
Credit Transactions RATES AND TAXES BANK CHARGES

NOMINAL SECTION FUEL ADVERTISING

5
DR INCOME CR POSTAGE DEPRECIATION

- Decrease + Increase
MATERIAL COSTS STATIONERY
6
DR E XPENSES CR

+ Increase - Decrease STORAGE

 ACCOUNTING
CASH TRANSACTIONS

GRADE 8
THEORY AND
WORKBOOK

2020 EDITION

Y. T. GIETL

The EMS Specialists

WAMARK EDUCATIONAL PUBLISHERS

 The EMS Specialists

WAMARK EDUCATIONAL PUBLISHERS

[email protected]
072 827 7925
www.wamark.co.za

Cover design by Y T Gietl

Typography by S Jordaan

Printed by Repro India

Fifteenth Edition October 2018

ISBN 978-0-9585017-4-3

© All rights reserved

No part of this book may be reproduced
or transmitted in any form or
by any means, electronic or mechanical,
including photocopying, recording,
or any information storage and retrieval system,
without permission in writing from the publishers.
 ACCOUNTING GRADE 8
INDEX
THEORY PAGE EXERCISE PAGE

1. Goal Statement + Posting Rules 1-2

2. Continuous Homework Assessment 3 - 4
3. Plot your Progress 5-6

4. Terminology 7 - 10

5. The History of Accounting 11 - 14

6. The Accounting Equation 15 - 18 Activity A=O+L 19 - 25

7. Types of Businesses
26
7.1 A Service Business
7.2 Trading Business 27 - 28

7.3 Manufacturing Business 29 - 30 Activity - Cost of Sales 31

8. The Accounting Cycle/Process 32 - 33

9. Transactions (Cash) 34 Exercise 1 (Example) 35 - 36

A=O+L Exercise 2 37
The Effect of transactions on Exercise 3 37 - 38
the Accounting Equation Exercise 4 38
Exercise 5 38 - 39
Exercise 6 39
Exercise 7 39

10. Source Documents

10.1 Cash Register Roll 40 - 41
10.2 Receipt Book 42 - 43

11. Journals Exercise 8 44 - 45

Cash Receipts Journal Exercise 9 46
11.1 Recording Cash Receipts Exercise 10 47
of a Service Business. Exercise 11 48 - 49
Exercise 12 50

11.2 Recording Cash Receipts

51 Exercise 13 52
of a trading business
Exercise 14 53
Exercise 15 54
Exercise 16 55
Exercise 17 56
Exercise 18 57
 ACCOUNTING GRADE 8
INDEX
THEORY PAGE EXERCISE PAGE

11.3 Recording Cash Receipts

of a business that
Trades and provides a 58 Exercise 19 59
Service Exercise 20 60
12.Source Documents
Cash Payments Journal
12.1 The Cheque and Cheque Counterfoil Exercise 21 66
Exercise 22 67
Cash Payments Journal (CPJ) 61 - 65
Exercise 23 68
Exercise 24 69
Exercise 25 70
Exercise 26 71
******NEW******
CRJ, CPJ of service businesses *Exercise 27 72 - 73
*Exercise 28 74 - 78
*Exercise 29 76 - 77
*Exercise 30 79 - 79

13. Source Documents

Petty Cash Journal Exercise 31
13.1 Petty Cash Voucher 85
Exercise 32 86
Petty Cash Journal (PCJ) 80 - 84 Exercise 33 87
Exercise 34 88
Exercise 35 89

14. Full Set of Journals

14.1 CRJ, CPJ, PCJ (Source documents) Exercise 36 90 - 94
14.2 CRJ, CPJ, PCJ (Transactions) Exercise 37 95 - 97
14.3 CRJ, CPJ, PCJ (Source documents
and transactions) Exercise 38 98 - 103
14.4 CRJ, CPJ, PCJ (Including EFT Receipts Exercise 39 104 - 105
and Payments) Exercise 40 106 - 110
 ACCOUNTING GRADE 8
INDEX
THEORY PAGE EXERCISE PAGE

15. The General Ledger 111

Format of the General Ledger 112
15.1 Sections and Accounts of the
113
General Ledger
15.2 Recording transactions in the
General Ledger T Accounts 114
15.3 Double Entry Rule 115 - 117 Exercise 41 118
Transaction Analysis Exercise 41.1 & 42.1 119
Exercise 43.1 & 44.1 120
Exercise 42 121
Exercise 43 122
Exercise 44 123
Exercise 45 124
Exercise 45.1 & 46.1 125
Exercise 47.1 & 47.1 126
Exercise 46 127
Exercise 47 128
Exercise 48 129
Exercise 49 130
Exercise 49.1 & 50.1 131
Exercise 50 133

16. The General Ledger

16.1 Posting from the Cash Journals 135 Example 136 - 139
Exercise 51 140- 141
Exercise 52 142 - 143
Exercise 53 144 - 145
Exercise 54 146 - 147
Journal Ledger
16.2 Posting the Cash Journals Exercise 55 150 156 -157
and Balancing the Accounts Exercise 56 151 158 -159
Exercise 57 152 160 -161
of the General Ledger 148 - 149
Exercise 58 153 162 -163
Exercise 59 154 164 -165

17. The Trial Balance Format Example 168 - 170

of the Trial Balance 166 -167 Exercise 60 171 - 174
Exercise 61 175 - 177

18. Financial Statements

18.1 Income Statement 178 - 179 Example 180 - 181
Exercise 62 182 - 183
Exercise 63 184 - 185
18.2 The Balance Sheet 186 - 188 Example
Exercise 64 189
Exercise 65 190
Contribution by Morne Nel
(Saint Benedict's Catholic College for Boys)
 ECONOMIC AND MANAGEMENT SCIENCES GRADE 8

PERSONAL GOAL STATEMENT OF __________________________

YEAR: ______

LEVEL INDICATORS

1 = Not Achieved (0 – 29%)

2 = Elementary Achievement (30 – 39%)
3 = Moderate Achievement (40 – 49%)
4 = Adequate Achievement (50 – 59%)
5 = Substantial Achievement (60 – 69%) You’re Starting to impress
6 = Meritorious Achievement (70 – 79%) Okay, you like EMS
7 = Outstanding Achievement (80 – 100%) Now that’s what I’m talking about!

SELF ASSESSMENT

SHORT TERM GOALS (Values & Attitude)

DATE:
Describe what daily actions you are going to take to
ensure that you are going to perform to your fullest TERM TERM TERM TERM
potential in EMS (Think of what you could have done 1 2 3 4
better in Grade 7 as your starting point)
1.
2.
3.
4.
5.
6.

LONG TERM GOALS (Skills & Knowledge)

The Economy: Government, National Budget
& Standard of living
T1
Financial Literacy: Accounting Concepts 7
Source Documents
Financial Literacy: The Accounting Cycle,
Cash Receipts Journal
T2 Entrepreneurship: Factors Of Production
The Economy: Markets Goods and Factor,
Financial & Labour
Financial Literacy: Cash Receipts Journal,
T3 Cash Payments Journal
Entrepreneurship: Forms of Ownership
Entrepreneurship: Levels & Functions of
Management
T4
Financial Literacy: The General Ledger &
Trial Balance

Signature: ___________________ Date: _______________

1
2
 ACCOUNTING AND FINANCIAL LITERACY

CONTINUOUS HOMEWORK ASSESSMENT OF

YEAR ___________ GRADE 8 _______

MARK ALLOCATION:

5 = Homework completed and signed by Parent/Guardian. Samples signatures

of parent / guardian
0 = (a) Homework not written down.
(b) Homework not done or incomplete.
(c) No Signature of Parent/Guardian.

Mark Parent/ Guardian

DATE HOMEWORK Allocation Signature
0/5

3
 Mark Parent/ Guardian
DATE HOMEWORK Allocation Signature
0/5

4
 PLOT YOUR PROGRESS
ON THE CHART BELOW

100

90

80

70

5
60

50

40

PERCENTAGE
30

20

10

EXERCISE NUMBER
 PLOT YOUR PROGRESS
ON THE CHART BELOW

100

90

80

70

6
60

50

40

PERCENTAGE
30

20

10

EXERCISE NUMBER
 T TERMINOLOGY

Write the accounting terms in the spaces provided as and when you come across the T
Terminology signs in your workbook.

Cash Register - Point of Sale (POS)

A Teller Machine
Source Document - Duplicate till slip

Accounting Equation Cash Transaction

A=O+L money is exchanged for goods sold or
Assets = Owners Equity + Liabilities services rendered

Assets c/d
Assets are possessions that Closing Balances of General Ledger Accounts. (The
have monetary value. difference between the Debit and Credit sides)

Cheque Counterfoil
B The source document of a cheque

Balance Sheet Section of the General Ledger Chronological order

include the Owners Equity accounts (Capital & In an order e.g. numerical order
Drawings), Assets and Liabilities

Balance Sheet Commercial Service

A = O + L. A snapshot of the Financial position of A service provided to business in order to get
a business. (Info from Trial Balance & Income their goods/services sold e.g. advertising
Statement
b/d Community Service
Opening balance of General Ledger Accounts. A service rendered by a government department
Brought down from the previous month. e.g. medical (Clinic), education (Schools)

Cost Price (Formula)

CP = SP x 100
1 100 x % m.u.

C
Cost of Sales
The Cost Price of goods before a mark up is added

CR
Credit - The RHS of the General Ledger

Capital
Capital is needed to start a business. The owner Credit Transaction
lends Capital to the business. Capital is an O/E Payment for goods and services made at a
Account. A Capital contribution increases O/E later date as agreed upon by the two parties

Cash Payments Journal (CPJ) Creditor

Cash Payments posted to the CPJ A person or institution that is owned money by
i.e. Cheque - Source Doc - Cheque Counterfoil & the business. A creditor is a short term liability.
EFT Payments - Source Doc - Bank Statement
Cash Receipts Journal (CRJ) Current Assets
Cash Receipts posted to the CRJ Cash on hand i.e. Cash float, Petty cash, Bank
e.g. Cash Register - Duplicate CRR, and
Receipt Book - Duplicate Receipt & Assets that are easily converted to cash e.g.
EFT Receipt - Bank Statement Trading Inventory and Debtors

7
 F
Current Income
The income generated by a business in the
service industry.
Financial Statements
There are 2 Financial Statements i.e.
D Income Statement - Profit / Loss
Balance Sheet - Financial Position (Wellness)

Debtors Fixed Costs

People or institutions that owe the business Expenses that are the same every month e.g.
money. Debtors are Current Assets. Rent

Deficit Formal Trader

The owner of a registered business e.g. Private
Negative Balance or showing a loss Company

Depreciation

Assets losing value over a period of timed

G
Distribution General Ledger
The process of getting goods from the manufacturer T - accounts. Posting transactions to the accounts
to the wholesaler, to the trader, to the consumer affected. DR side = CR side

Dr Gross Profit
Debit - The LHS of the General Ledger Profit made by the business selling goods /
services. Excludes other forms of income called
Operating Income e.g. Rent income
Double Entry Rule Gross Operating Income
For every Debit, there is a Credit in the General Gross Profit including Operating Income
Ledger. The contra account must be detailed. e.g. rent income
Drawings
Money drawn by the owner from the business for
personal use. Drawings is an O / E Account. I
Drawings decrease O / E
Income
Duplicate CRR/T (cash register roll/tape)
Money coming in. Money generated by the
The source document for cash received in
business when selling goods or services. Income
exchange for goods / services, at a till point
includes rent income or interest income
Duplicate Receipt Income Statement
The source document for cash received in Drawn up to show all the income and expenses.
exchange for goods / services, recorded in a cash The difference between Income and expenses is
receipt book a profit or a loss.
Informal Trader
E The owner of a business that is not registered e.g.
Sole Proprietor or side walk trader

Expenses Imprest Amount

The goods and services a business pays for in The initial amount used to establish a
order to operate day to day e.g. Electricity & Fuel Petty Cash Box

8
 Ledger Accounts Nominal Section
The Accounts that are affected by the The Section of the General Ledger that includes
transactions within a business e.g. Bank & Fuel the Income and Expense Accounts

Liabilities
People or institutions the business owes money
to e.g. Loans and Creditors
O
Liquidated Operating Expenses
Non current Assets converted to Current Assets Day to day expenses of a business e.g.
e.g. Vehicle sold for cash. Liquid = Cash telephone, stationery and advertising

Long Term Liability Other Operating Incomes

A liability payable over a long period of time e.g. Income generated by any means other than
a mortgage payable over 25 years selling of goods or services e.g. rent income

Long Term Loan Owner’s Equity

Another example of a Long Term Liability. Its a The Owners Financial stake in the business.
loan payable over a long period of time Income increases O / E, Expenses decrease O / E

M
Opening balance
See b/d

Manufacturing
Businesses that produce semi finished goods from
natural resources e.g. planks from trees or semi
finished goods into finished goods e.g. planks into
furniture
Mark-up %
The percentage added to the Cost Price to
determine the asking / selling price
P
Material Costs Packaging Material
The cost of the materials needed to produce a These are the materials used to package goods to
product e.g. eggs, sugar, milk flour to bake a cake keep them safe from damage or contamination.

Personal Service
e.g. Dentist, doctor, hair dresser, optometrist, nail
technician, beauty spa etc.

N
Net Profit / Loss
Gross Operating Income LESS Gross Operating
Expenses
Non Current Assets Petty Expenses
Assets that are used for many years in the process Small expenses paid for from Petty Cash
of operating a business e.g. delivery vehicle. Non e.g. parking, postage stamps
Current Assets can be converted to cash
Posting
Posting source documents / transactions directly
to the General Ledger OR
Posting Journal Totals to the General Ledger

9
 Trading Inventory (Stock)
R The value of the goods before a mark up has
been added i.e. The Cost Price

Receipt Book Transaction

A book where the details of cash sales are An activity between two parties during which
recorded in duplicate one renders a service/ sellds goods for which
the other one pays
Restore Imprest Amount
Restoring / replacing the money spent from the
Petty Cash box to the imprest amount.

Trial Balance
A summary of all the General Ledger Account
Balances DR = CR

S
Sales
The income generated from selling goods i.e.
Trading

Service Business
A business that provides a service to generate an
income e.g. advertising, hair salon, education U
Short Term Liability
A liability that is payable within a month or over a
few months e.g. Bank overdraft, Creditors

Source Document
The document where details of a transaction are
found e.g. Document number, date, amount etc.

T
Trading Business
A business that buys and resells goods to
make a profit

10
 THE HISTORY OF ACCOUNTING

1. Record Keeping in Mesopotamia

1.1. The practice of Accounting has been around for many thousands of years. In
3500 BC the Assyrian, Chaldaean, Babylonian and Sumerian civilisations were
flourishing in the Mesopotamia Valley. This area between the Tigris and
Euphrates Rivers, now within the borders of Iraq, experienced periodic flooding
which made the valley especially fertile for agriculture.

1.2. As farmers prospered, service businesses and small industries developed in

the communities around the Mesopotamia Valley. There was more than one
banking firm in Mesopotamia. They used the gold and silver standard of
measuring value and they extended credit in some transactions.

1.3 The Mesopotamian equivalent to an accountant was the scribe. In a typical

recording of a transaction of the time, the parties would seek out a scribe at
the city gates. They would describe their agreement to the scribe, who would
take from his supply a small quantity of clay on which to record the
transaction. Clay was plentiful in this area, while papyrus was scarce and
expensive.

1.4. The moist clay was moulded into a size and shape adequate to contain the
terms of the agreement. Using a rod with a triangular end, the scribe recorded
the names of the contracting parties, the goods and money exchanged and
any other promises made. The parties then signed their names to the tablet by
impressing their prospective seals. In the age of mass illiteracy, men carried their
signatures around their necks in the form of a stone engraved with the bearers
mark and it was buried with them at death. The clay tablet would then be dried in
the sun or in a kiln.

11
2. Record keeping in Medieval Europe

2.1. The Medieval Period lasted for about 1000 years. It is the
period between the fall of the Roman Empire in the 5th
century and the Early Modern Period of the 16th century.

2.2. The oldest accounting record in the English language is

the Pipe Roll which provide an annual description of
rents, fines and taxes due to the King of England from
1130 – 1830.

2.3 Even before the use of the Pipe Roll, the tally stick was
used to record transactions. The tally stick was up to six
feet long. Notches of varying size were cut into the
wooden stick to indicate the amount received or owed.
The tally stick was spilt in two equal parts down the
middle, one half for each of the parties involved in the
transaction. Their names were written on their half of the
stick.

The Pipe Roll

12
3. Ancient record keeping in North America

3.1. The Inca people of North America devised a system of recording transactions
using the quipas or “talking knots”. The quipas were made of lama hair and
consisted of a few strands or as many as 2000 strands. The complexity and
number of knots indicated the contents of warehouses, the number of
taxpayers in a given province, and census figures.

4. Modern Day accounting

4.1. Most of the formal modern day accounting started at the end of the
Crusades.The Crusades were religiously sanctioned military campaigns
aimed at restoring Christian control of the Holy Land (mostly Isreal and Palestine)
and was fought over a period of nearly 200 years, between 1095 and 1291.

4.2. As trade dramatically increased between Europe and Middle East, business
grew beyond what a single owner could manage. This brought about the need
for written records so that business owners could keep track of their
transactions and ensure that their businesses were profitable.

13
5. The Double entry System

5.1. The double entry system was first used in Italy around the 13th century. Luca
Pocioli wrote about the “Venice Method” in his 1494 book, The Summa. The
Summa was illustrated by his friend Leonardo DiVinci. Pocioli has been refered to
as the father of accounting although all he really did was publish the method.

5.2. This “Venice Method” called for three (3) books to be used when recording
transactions. A memorandum book, a journal and a ledger. The entries were
posted to the ledger with debits on the left hand side and credits on the right.

5.3. The word Debit comes from the Latin word “debita” which means owed to the
proprietor (owner).

5.4. The word Credit comes from the latin word “credo” which means owed by the
proprietor.

6. The Industrial revolution

6.1. With the Industrial revolution (When manual labour was relpaced by
machinery) businesses expanded in sales, purchases and staff. The larger
businesses needed capital which was loaned by investors. The investors
wanted proper reports of the use of funds (money).

6.2. Accounting kept on advancing to the present day and accounting has been
standardised internationally

14
 THE ACCOUNTING EQUATION

1. Definition of accounting

Accounting is a language. This language provides information about the financial position
of an organisation/business. By learning this language you will be able to communicate
and understand the financial operations of any business.

2. The accounting equation

T
2.1 Accounting is built on the accounting equation.

Assets = Owners Equity + Liabilities

This equation is used for a Sole Proprietor (A business owned by one person)

2.2 The accounting equation must be in balance at any given time and for that
reason the modern accounting system is called a double or dual entry system.
This means that every transaction recorded must have at least two entries.
If there are not two entries that equation will be unbalanced. Every transaction
affects two accounts (Contra - accounts)

2.3 The accounting equation has three (3) parts:

Assets (A)
Owners Equity (O/E) and
Liabilities (L)

A O/E+L

15
 THE ACCOUNTING EQUATION

T The Accounting Equation

(Own) (Owe)
Assets = Owner’s Equity + Liabilities
Capital Drawings

Income Expenses
(Increase Owner’s Equity) (Decrease Owners Equity)

A O/E+L

1. ASSETS
T
Assets are possessions. These goods have monetary value.
Assets of a business are divided into two
categories namely:

a) Non Current Assets eg. buildings, vehicles, equipment.

T

A Non Current Asset is purchased by the business to be used for many years in the
process of generating an income. Most non-current assets loose value
over time and with use. ( T Depreciation)
T T
b) Current assets eg. Bank, Cash Float, Debtors
(people who owe the business money) and Trading Inventory.
Current Assets include: Cash in the Bank, Petty Cash, Cash Float, (money in the till)
and Assets that can be converted to cash in a short period of time e.g. Trading
Inventory being sold.
ASSETS ARE WHAT THE BUSINESS OWNS
Do you own anything of value? List your Assets. (Include the money owed to you)

Current Assets:

Non Current Assets:

2. OWNER’S EQUITY

Owner’s Equity is the owner’s financial stake in the business. The owner lends
money to the business (i.e. Capital) and draws money for personal use (i.e. Drawings)
The two Owner’s Equity accounts are Capital and Drawings.
T
2.1 INCOME (money coming in). Income is therefore money generated by the
activities of the business eg. selling goods/service and renting.
Income would include:

- Sales
- Current income
- Rent income
- Discount received etc.

Income increases the Owner’s Equity.

16
List your source/s of income

2.2. T EXPENSES are goods and services the business pays for in order to operate from
day to day. (Money going out).

Expenses have no resale value e.g. telephone account. More examples of expenses
would include: x Cost of sales x Donations
x Stationery x Wages
x Salaries x Material costs
x Packaging material x Advertising
x Postage x Insurance
x Licences x Telephone
x Bank Charges
x Rent Expense
x Fuel

Expenses decrease the Owner’s Equity.

What are your personal expenses

3. T LIABILITIES - People, institutions to whom the business OWES money i.e. The
business takes possession of certain goods or is provided with a service for which payment
is not made at the point of the transaction. (Credit transaction). The person who the
business owes money to is called a T Creditor. Interest is paid on the amount owed.

Liabilities are further divided into two categories i.e.

T
Long term liabilities
e.g. Long Term Loan; Mortgage Bond etc.

T Short term liabilities

e.g. Creditors, Bank Overdraft etc.

The main difference between the two is how long (payment period) the business has to
settle (pay in full) e.g. a Mortgage Bond is payable over 20 - 25 years (long term)
whereas Creditors usually want payment within 30 days from Statement (short term).

LIABILITIES ARE WHAT THE BUSINESS OWES

Do you owe anyone money? To whom and how much?

17
 OWNER’S EQUITY

1. THE OWNER 2. THE BUSINESS

The owner decides on a form

of ownership eg. sole
propriety, Incorporation,
company or franchise etc.

1.1 The owner lends money to the

business. This is called T Capital.
2.1 The Capital is deposited into the
1.2 Therefore the owner has a business bank account.
financial stake in the business
and this is called T “Owner’s
Equity”. (O/E) 2.2 Expenses of the business cause the
Owner’s Equity to decrease.
1.3 The Capital can be increased at
the owner’s will.
2.3 Income of the business cause the
1.4 By increasing the Capital the Owner’s Equity to increase.
Owner’s Equity also increases.

1.5 When the owner draws money

from the business account for
personal use eg. dinner with
friends, it is called T Drawings.

1.6 Drawings decreases the

Owner’s Equity.

1.7 The two Owner’s Equity

Accounts are therefore:

• Capital - the account that

shows the capital (cash)
contributions/s made by the
owner. Capital is not an
income

• Drawings - the account used

to show any money drawn by
the owner from the business
for personal use. Drawings is
not an expense

18
ACTIVITY

1. Refer to the flashcards on the next page. Colour

Choose a different colour pencil for each of the following:
Owner’s
Equity White
Accounts

Assets Blue

Income Yellow

Expenses Red

Liabilities Green

Colour all the assets, (flashcards) with the colour you chose. Then do the same with the
Incomes, Expenses, Liabilities and Owner’s Equity Accounts.

1.2 Cut the flashcards out and write your initials at the back of each one.

1.3 Practice arranging them correctly

1.4 Paste them over the two pages provided

ASSETS OWNERS EQUITY LIABILITIES

x x
Non-current liabilities
Non Current Assets Income Expenses (Long term liabilities)
x x x x
x x x x
x x x x
x x x x
x x
Current liabilities
x x
Current Assets (Short term liabilities)
x x
x
x x
x
x x
x
x x
x

https://www.youtube.com/watch?v=Nwmz8Z9-uYE

19
20
 FIXED DEPOSIT FUEL CURRENT INCOME RENT INCOME

RATES AND TAXES EXPENSES LIABILITIES VEHICLES

PACKAGING
CAPITAL EQUIPMENT POSTAGE
MATERIAL

STORAGE
O/E DRAWINGS PETTY CASH

NON
TRADING WATER &
REPAIRS CURRENT
INVENTORY ELECTRICITY
ASSETS

SHORT TERM
LOAN
WAGES
= TELEPHONE

NON
CURRENT BANK INCOME MATERIAL COSTS
LIABILITIES

DEBTORS OFFICE MORTGAGE DEPRECIATION

CONTROL FURNITURE BOND

SHORT TERM BANK OVER

COST OF BAD DEBTS
LIABILITIES DRAFT
SALES RECOVERED

A CURRENT
ASSETS
LONG TERM
LIABILITIES
INTEREST
RECEIVED

OWNER’S
+
LONG TERM DISCOUNT
EQUITY LOAN ALLOWED

CREDITORS LAND AND DISCOUNT

CONTROL ASSETS BUILDINGS RECEIVED

SALARIES RENT EXPENSE STATIONERY INSURANCE

L CASH FLOAT SALES ADVERTISING

CURRENT
LICENCES DONATIONS BANK CHARGES
LIABILITIES

21
22
ACCOUNTING
EQUATION
=

A O+L

23
 THE ACCOUNTING EQUATION
A = O/E + L

24
25
 TYPES OF BUSINESSES

There are three main types of businesses. There are service businesses
(provide services), businesses that trade (buy and sell goods) and businesses
that manufacture (make goods which they then sell)
T
1. A SERVICE BUSINESS

1.1 A service business specialises in a specific need or want that consumers cannot
provide for themselves e.g. dentist.

There are three main types of services.

a) T Personal service e.g. dentist, doctor, hairdresser.

b) T
Community services are services,
which the government provides. People pay either
directly or indirectly for these services by paying taxes to
the government. Education at an ex model C school is an
example of an indirect and direct payment for a community
service because government subsidises the school using
the taxes we pay (indirect) whilst parents also pay school
fees (direct).

c) T Commercial service includes activities needed by

businesses to get goods to the consumer e.g. advertising
transport, insurance, telecommunication and banking.

1.2 The income for a business in the service industry is called T current income.

The two accounts affected by generating an income from providing a service are:

1 • Current Income - Where the money came from

2 • Bank - Deposit the money

EXAMPLE
Analyse the following transactions of a company that provides a garden service.

3rd Received R 300.00 for garden service provided.

4th Received R 2 500.00 for clean up service provided.

1 2
DATE BANK CURRENT ACCOUNT
3rd
4th

1.3 Think of skills and talents you possess. If you were to start a legitimate (legal)
informal business in the service industry this week, what would it be? Specify whether it’s
a personal or commercial service.

26
 T
2. A TRADING BUSINESS

2.1 A business that buys and resells goods is called a trading business. Trading businesses
have to assemble the goods they want to sell, store the goods and then distribute the
goods.

2.2 The two types of traders are informal and formal traders.

a) The T formal trader registers his business with the relevant authorities
(depending on the form of ownership) as well as with the SARS (S A Revenue
Service) to whom he pays taxes on each transaction (VAT) and on his profit
(income tax). The expenses of a formal trader are higher than an informal
trader e.g. Rent, telephone and water and electricity. SPAR is an example of a
formal trader as they have buyers that scout for the best products at the best
prices from manufacturers and wholesalers (assembling). The goods are then
stored (storage) in large warehouses until SPAR outlets request stock. The
process of getting the goods from the manufacturer to the wholesaler to the trader
and finally to the consumer, is called T distribution.

The cost price (CP) of the goods that the trader assembles is called T Cost of Sales.
The goods are called T Trading Inventory (Stock). The trader then adds his % mark up
to get his selling price (SP). T Sales - the sale of these goods generate and income. The
trader includes Value Added Tax (VAT) in his selling price. The trader banks the money
from his sales daily into the business Bank Account.

b) An T informal trader will buy goods in bulk from the

market (assembling), repackage the goods into
smaller quantities and sell the goods at a taxi rank
(distribution). If the trader does not sell all his goods
he will have to find a place to store the goods till the
next day. (Storage). An informal trader does not need
a lot of money to start his business and he does not
register the business either. The informal trader
does not include or charge VAT so the SARS does
not benefit from the businesses transactions or
profit. He does however have to comply with the by
laws of the city e.g. Not allowed to trade on
pavements in front of shops. This law protects the
rights of the shop owners who are paying rent, from
unfair competition. The sidewalks are not congested and the amount of litter
is reduced.
2.3 The income for a business that trades is called sales.
The four accounts affected when the business sells goods for cash are:
1 Sales - Selling Price
2 Bank - Deposit the money

3 Trading Inventory - Value of goods before% m.u. has been added.

4 Cost of Sales - Cost Price of goods assembled.

27
 1
The income generated by the sales of goods is recorded in the account.
2
The income (money) from the sale is deposited into the account.

The value of the goods sold is recorded in the 3

account.

The Cost Price of the goods sold is recorded in the 4

of
account.
2.4 In order for the business to make a profit, a Percentage Mark Up (% m.u.) is added to the
Cost Price of the goods.

You will usually be given the Selling Price (SP) of the goods and you will have to calculate the
Cost of Sales (The same as Cost Price)
EXAMPLE
Cost of Sales Selling Price
(CP) % M.U. (SP)

? 20% R480.00
% m.u - Percentage mark up. The
T Formula for CP
percentage added to the cost price
SP 100
CP = X to determine the asking/selling price
1 (100 + % M.U.)

480 100
CP = X
1 120
CP = R400.00

1 2 3 4
SALES BANK TRADING COST OF SALES PROFIT
INVENTORY (CP) (Rand & Cents)

R480.00 R480.00 R400.00 R400.00 R80.00

2.5 NOW YOU TRY 2

17 3 change to decimal fraction
1. Cash sales R2600 (Profit mark up 20%)
2. Cash sales R4000 (Profit mark up 25%) 2 ÷ 3 = 0,66
3. Cash sales R5500 (Profit mark up 27 2 7%) = 17,66

1 2 3 4
Cost of Sales TRADING COST OF
Date (CP) % M.U. SP SALES BANK INVENTORY SALES PROFIT

2.6
The two accounts affected when a business R 29.99
buys goods/stock for cash are:
Bank
Trading Inventory

28
3. A MANUFACTURING BUSINESS

3.1 Manufacturing businesses include businesses that produce semi finished

goods from raw materials e.g. cut and treat wooden planks from trees.
They then sell the wood to furniture makers (producers) who manufacture
finished goods. e.g tables and chairs.

3.2 The furniture producers sell the finished goods to a furniture store and the
furniture store then sells the goods to the customer.

3.3 The chain from raw material to finished goods is called a value chain.
At every link of the chain i.e. from a tree to a piece of furniture, value has
been added to the product. Therefore at every link in the chain a
percentage Mark Up has been added. This is done firstly to cover the
cost of adding the value at every link e.g. salaries, rent, telephone etc
and secondly to make a profit.

3.4 The income of a business that is involved in manufacturing is also called sales (whether
selling semi finished goods or finished goods)

The four accounts affected by the selling of goods whether semi finished or finished are:
1 Sales
2 Bank

3 Trading Inventory
4 Cost of Sales

29
3.5 In order to manufacture a product, one would need certain materials and packaging
materials.

1 T MATERIAL COSTS - These are the materials needed to manufacture a

product e.g. flour, sugar, eggs and cocoa to bake a cake or to provide a
service e.g. wash cloths and soap for a car wash. Materials are used up or
consumed and have to be replaced/replenished.

2 T PACKAGING MATERIAL - These are the materials used to keep the product
safe from being damaged or contaminated. The shelf life of the product will
also be prolonged. Packaging plays an important role in advertising. The
effectiveness of a product’s packaging may make you choose one brand of
soap powder over another.
Packaging materials are also
consumed and have to be
replenished.

3 Tabulate the material costs and

packaging materials needed to
manufacture and package toffee
apples.

MATERIAL COSTS PACKAGING MATERIALS

4. If you were to start a business this week, what product could you manufacture
to make extra money?

5. Tabulate the material costs and packaging materials you would need.

MATERIAL COSTS PACKAGING MATERIALS

30
 NAME:
COST OF SALES (COST PRICE)
GRADE:
Calculations
DATE:

ACTUAL MARK TOTAL: 45

%
LEVEL DUE DATE:

Complete the following. Show all calculations on a separate piece of paper. Show the
formula for each calculation. (Flap paste the calculations)

COST PRICE % M.U. SELLING PRICE

1 66.66% R 100,00

2 75% R 157,50
4
3 28 7 % R 84,00
1
4 33 3 % R 180,00

5 22.77% R 221,00

6 90% R 142,50

7 36.9% R 11,50

8 18 32 % R 192,23

9 80% R 27,00

10 25% R 293,00

11 21 54 % R 675,00

12 300% R 50,75

13 7.26% R 399,00

14 9% R 6 540,00

15
150% R 1 780,00

FORMULA COST PRICE

15 X 3 = _____/45
To change a proper fraction into a decimal fraction.
NOTE: eg. 74
Using your calculator, enter 4 ÷ 7 = Your answer 0,57

31
 THE ACCOUNTING CYCLE / PROCESS

All activities in a business either bring in (generate) money or cost money.

These financial transactions have to be analysed, recorded and summarised.

The accounting cycle ensures accuracy and conformity when processing the transactions.
The accounting cycle also helps to reduce mathematical errors.

The accounting cycle is used to verify transactions and prepare financial statements. These
statements are for internal and external use. The information provided in the statements is
used to assess opportunities and make projections internally and for securing financing e.g.
overdraft, loans and external investments.

The are six sequential steps (Sequence - in order in which things follow)
Refer to the flow diagram on page 33)

1 + 2 Analysing the transactions from the source documents.

• Source document type e.g. receipt, till slip, cheque counterfoil or
petty cash voucher
• Method of payment - Cash or Credit
• The parties involved
• The date and
• amount

3 Recording the transactions into the journals.

4 Posting the journals to the General Ledger using the double entry
system.

5 Drawing up the Trial Balance to check the double entries made in the
General Ledger.

6 Drawing up the Financial statements i.e. Income Statement and Balance

Sheet.

This is a very brief overview and you will be given more information on each step as you
proceed through your workbook.

ACTIVITY 1
Paste in 3 source documents and highlight the transaction details i.e.
• Source document type
• Method of payment
• Parties involved (if stated)
• The date and
• amount
Flap paste if you run out of space.

32
 THE ACCOUNTING PROCESS / CYCLE

1. TRANSACTIONS

CASH (Grade 8) CREDIT (Grade 9)

After a transaction has taken place

a source document is issued. You will analyse
the relevant source documents
before you complete the journals.

2. CASH TRANSACTIONS - Source documents CREDIT TRANSACTIONS - Source documents

Duplicate Cash Register Roll (CRR) Original

ate
Duplic

Duplicate Invoice
Duplicate Receipt (Original issued to Debtors)

Cheque Counterfoil Original Invoices (Received from Creditors)

Petty Cash Voucher

Journals: The CRJ, CPJ and PCJ are used to

record cash transactions that have taken place in the
business. We are first going to complete each
cash journal before posting them to the
General Ledger.

3. CASH JOURNALS (Daily) CRJ CREDIT JOURNALS (Daily) DJ

CPJ CJ
PCJ

CASH RECEIPTS JOURNAL - CRJ DEBTORS JOURNAL - DJ

CASH PAYMENTS JOURNAL - CPJ CREDITORS JOURNAL - CJ

PETTY CASH JOURNAL - PCJ

POST ALL JOURNALS TO THE GENERAL LEDGER POST ALL JOURNALS TO THE SUBSIDIARY LEDGERS

SUBSIDIARY LEDGERS (Post daily from the Journals)

4.1 DEBTORS LEDGER

4. GENERAL LEDGER (Posting daily and monthly)
DETAILS DEBIT CREDIT BALANCE

DR CR
Ÿ Does not get posted to the Trial Balance
Ÿ Used to draw up the Debtors' Statements

4.2 CREDITORS LEDGER

Double entry rule
DETAILS DEBIT CREDIT BALANCE

5. TRIAL BALANCE (Drawn up monthly)

Ÿ Does not get posted to the Trial Balance
Used to reconcile Creditors' Statements
DEBITS = CREDITS Ÿ

6. FINANCIAL STATEMENTS (Drawn up annually)

6.1 INCOME STATEMENT 6.2 BALANCE SHEET A O+L

PROFIT/LOSS ASSETS = OWNERS EQUITY + LIABILITIES

33
TRANSACTIONS (Step 1)
1. T Transaction - A transaction is an activity between two parties during which, one
renders a service or sells goods for which the other pays.
There are two types of transactions ie.
T
1.1 Cash Transaction - Money in exchange for goods purchased or services
provided. (Cheques included).

1.2 T
Credit Transaction - No money exchanging hands at the point of the
transaction. Payment made later on agreed terms and conditions between
the two parties. (This will be covered in Grade 9).

1.3 Describe 3 recent cash transactions you have made.

2. Analysing the effect that transactions have on the Accounting Equation

STEP 1: Identify the two accounts affected by the transaction

STEP 2: Classify the account according to the Accounting Equation (Asset,

Income, Expense and/or Liability)

STEP 3: Follow the money!

Is the money increasing or decreasing Assets, O/E and/or Liabilities.

NOTE: Assets will always be equal to Owners Equity and Liabilities. This is because
there are always at least two accounts affected for each transaction. Where one
account increases another account decreases. Therefore the Accounting
Equation is always a balanced.

A O/E+L

REMEMBER: INCOME will always Increase O/E

EXPENSES will always Decrease O/E

34
 THE EFFECT THAT CASH TRANSACTIONS HAVE ON A O/E+L
THE ACCOUNTING EQUATION

EXAMPLE
REASON / ACCOUNTING EQUATION
ACCOUNTS
A = O/E + L
OWNERS EQUITY
TRANSACTION AFFECTED
EXERCISE 1
Bank Capital
1.1 The owner makes a Capital Bank - Asset -
contribution of R90 000. Increases + 9000 + 9000
The two accounts affected by this
transaction are namely Bank and Capital - O/E
Capital. Bank is as Asset. The Account - Increases
business bank account increases O/E
because the Capital contribution is
banked. Capital is an Owners
Equity account. Owner's Equity is
increased.

Bank
1.2 Buy a Vehicle for R50 000 Bank - Asset -
The Bank and Vehicles accounts - 50 000
Decreases Vehicles
are affected. Bank decreases and
Vehicles increases. They are + 50 000
Vehicles - Asset -
however both Assets. There is no Increases
effect on the Accounting Equation,
because we are exchanging one
asset (money in the bank) for
another (vehicle) i.e. a current
asset for a non current asset.

1.3 Pay R500.00 by cheque for Bank - Asset -

Stationery. Decreases
Bank Stationery
The accounts affected are Bank
and Stationery. Bank is an Asset Stationery - Expense - 500 -500
and Stationery is an Expense. - Decreases O/E
Bank decreases because a
payment is being made. An
expense decreases the Owner's
Equity.

1.4 Cash a cheque to pay Wages Bank - Asset -

Bank Wages
R7 000.00 Decreases
Bank - Asset - Decreases to make - 7000 - 7000
payment Wages - Expense -
Wages - Expense - Decreases Decreases O/E
Owner's Equity.

35
 A O/E+L

REASON / ACCOUNTING EQUATION

ACCOUNTS
A = O/E + L
OWNERS EQUITY
TRANSACTION AFFECTED

Bank Current Income

1.5 Services rendered R300. Bank - Asset -
Bank - Asset - Increases as Increases + 300 + 300
money is deposited
Current Income - Income - Current income -
Increases Owner's Equity Income - Increases
O/E

1.6 Draw R500.00 for personal use. Bank - Asset -

Bank - Asset - Decreases Decreases Drawings
Bank
Drawings - Owner's Equity
Account - Decreases Owner's - 500 -500
Drawings - O/E
Equity account - Decreases
O/E

ACTIVITY
1. Underline the correct word.

1.1 INCOME increase / decreases Owner's Equity

1.2 EXPENSES increases / decreases Owner's Equity

2. Complete the equation.

2.1. ______ 2.2. ______

https://www.youtube.com/watch?v=00tT0gS-fTo

36
 A O/E+L
Date: ___________ ACCOUNTING EQUATION
REASON /
ACCOUNTS
A = O/E + L
OWNERS EQUITY
TRANSACTION AFFECTED
EXERCISE 2
1. T. Thulu deposited R50 000 in
current bank account of his
business, as his capital
contribution

2. Purchased garden tools from

Mew Traders for R2400

3. Paid cost of trading licence to

municipality, R475

4. Paid for stationery purchased,

R120

5. Purchased vehicle from

Budget Motors, for R32 500

6. Paid telephone account R165

7. Cash received for services

rendered, R3 270

8. Purchased office equipment

from Rowan Traders for R4 800

9. Paid municipality R465 by for

water and electricity

10. Paid wages R1 050

11. Cash received for services

rendered, R2 450

EXERCISE 3

1. H. Pelse deposited R38 000 as

his capital contribution in current
bank account of the business.

2. Paid R480 to municipality for

trading licence

3. Rented part of building from

Christo Properties; paid R830

4. Purchased vehicle, R21 200 and

motorcycle, R4 800 from Total
Motors

37
 A O/E+L

Date: ___________ ACCOUNTING EQUATION

REASON /
ACCOUNTS
A = O/E + L
OWNERS EQUITY
TRANSACTION AFFECTED
EXERCISE 3 continued
5. Purchased cleaning material from
Viva Stores; for R350

6. Paid R7 200 to Boesman

Wholesalers for equipment
purchased

7. Purchased stationery from Jolie

Traders; paid R130

8. Cash received for services

rendered, R2 150

9. Payment made: R265 to

municipality for water & electricity

10. Cash received for services

rendered, R3 430

11. Paid wages, R760

EXERCISE 4

1. Mr P. Dave started a business,

Serenba Services, with capital
contribution of R30 000 deposited
in the firm's current account.

2. Purchased equipment from Elweni

Stores; for R12 000

3. Paid municipality for trading

licence, R500

4. Paid rent to Brad Properties,

R1 200

5. Cash received for services

rendered, R2 900

EXERCISE 5

1. P. Phola paid R30 000 into current

bank account of Phola Services as
his capital contribution.

2. Received rent, R750

38
 Date: ___________
A O/E+L

REASON / ACCOUNTING EQUATION

ACCOUNTS
A = O/E + L
OWNERS EQUITY
TRANSACTION AFFECTED

EXERCISE 5 continued
3. Paid wages, R400

4. Purchased equipment from

Svantie Stores; R10 000

5. Services rendered for cash,

R1 700

6. Paid rent of building by cheque,

R800
EXERCISE 6
1. K. Klopper capital contribution,
R35 000, paid into current bank
account of the business.

2. Purchased equipment from Venter

Stores; R15 000

3. Purchased vehicle from OB

Motors for R25 000.

4. Paid Venter Stores R10 000 for

stock. (Trading inventory)

EXERCISE 7
1. J.J. Depp deposited his capital
contribution, R40 000, into the
current bank account of the
business

2. Purchased vehicle from CJ

Motors, for R30 000

3. Purchased equipment from Japie

Stores, R8 000

4. Paid Rent R2 000

5. Bought stock R5 000

6. Paid Water and Electricity R300

7. R5 000 received for services

rendered

8. JJ Depp increased his capital

contribution to R45 000

9. Paid for fuel R350

39
 When you work through the transactions in your accounting book, Place
imagine that you are the accountant of every company. Think of
which source documents you would have to prove that the
your Photo
transactions took place i.e. from the businesses' point of view. here

Accountant
SOURCE DOCUMENTS (Step 2)

The daily cash transactions of a business are recorded from source documents.
The following source documents prove the cash transactions of a business.

1 2
3
RECEIPT
AND/OR BOOK
SH
CA X
BO

Cash register roll Receipt Petty cash voucher

Cheque counterfoil
or till slip (duplicate)
(Duplicate)
1. THE CASH REGISTER

There are two ways a business can prove a cash sale.

a) If the business has a T cash register (till), the transaction will be
typed in. The paper in the till. (Cash register roll) is self duplicating.
The duplicate cash register roll (CRR) stays in the machine and the original till slip
is handed to the customer. The duplicate crr is removed at the end of the day and
all the cash sales will be recorded in the Cash Receipts Journal (CRJ) The
T duplicate cash register roll is therefore the source document which proves the

business received money and will be shown as a (tick) in the “document no”
column of the CRJ.

ACTIVITY 1
Paste three (3) examples of till slips on the next page. Identify by circling / highlighting
the transaction details. e.g. date, amount, document number etc. and labeling them.

Question: Do you as the customer have the original or duplicate till slip?

The business then has the to prove the transaction took place.
This is the Source Document i.e. the source of information regarding the transaction.

Does anyone's name appear on a till slip or duplicate CRR? No.

NOTE: That is why we record the transaction as 'cash sales' when trading or
when providing a service in the 'details' column

SOURCE DOCUMENT
TRANSACTION DETAILS
FOR THE BUSINESS
Cash Sale of Goods
Duplicate CRR (P) Cash sales
Cash received for Services

40
ACTIVITY 1 - Source Documents (Examples of till slips and receipts) Date: _____________

41
 POST TRANSACTIONS TO THE CRJ

POST TOTALS AND SUNDRY TRANSACTIONS

FROM THE CRJ
TO THE GENERAL LEDGER
POSTING RULES
DR CR

Bank
x
CRJ
Current Income
x

42
 RE
C
BO EIPT
OK
2. THE RECEIPT BOOK

RECEIPT
B A
RECEIVED FROM: P. BRUMA NO: 0077

WITH THANKS
C 29/03/05
DATE:

THE SUM OF: D SIX HUNDRED AND SEVENTY

17
FIVE RAND AND C ONLY E
100 R 675.17
CHEQUE/CASH
F RUGBY BOOTS
IN PAYMENT OF

FOR PJ SUPPLIES G MP Woods

A. Receipt number in numerical order (number order)

B. Name of Company or person from whom the money is received. (Details in the CRJ)
C. The date of the transaction.
D. The amount received in words.
E. The amount received in Rands and cents.
F. Details of the transaction,
G. The person receiving the money on behalf of the business. (Signature)

ACTIVITY 2
Paste two examples of receipts on the opposite page. Identify by circling / highlighting the
transaction details e.g. date, amount, document number, customer name etc. (Draw them
if you don't have examples).

Question: Do you as the customer have the original or duplicate receipt?

The business then has the to prove the transaction took place.

The business or person’s name appears on a receipt

NOTE: and that is why the name of the business or person is recorded
in the ‘details’ column of the CRJ.

SOURCE DOCUMENT
TRANSACTION DETAILS
FOR THE BUSINESS
Cash Sale of Goods Name of person or
Duplicate Receipt business (customer)
Cash received for Services

43
 JOURNALS (Step 3)
RECEIPT
BOOK
RECORDING CASH RECEIPTS
OF A SERVICE BUSINESS
(CASH RECEIPTS JOURNAL)
Cash receipts are recorded in the Cash Receipts
Journal CRJ

EXERCISE 8 Date: ___________

Ntombi Dlamini is the proud owner of an informal business. She

washes windows in her neighbourhood. Ntombi also does other
little jobs for extra income. Ntombi issues receipts to prove her
income.

! Enter the cash receipts in the Cash Receipts Journal of

“Ntombi’s Services”. These are the duplicate receipts in her
receipt book for July 20_____. Remeber to bank daily.
! Analyse the transactions and show their overall effect on the
Accounting Equation

RECEIPT RECEIPT RECEIPT

Date: Date: Date:

Received from: Received from: Received from:

Sum of Sum of Sum of

In payment of In payment of In payment of

For Ntombi’s Services For Ntombi’s Services For Ntombi’s Services

Signature: Signature: Signature:
041 042 043

RECEIPT RECEIPT RECEIPT

Date: Date: Date:

Received from: Received from: Received from:

Sum of Sum of Sum of

In payment of In payment of In payment of

For Ntombi’s Services For Ntombi’s Services For Ntombi’s Services

Signature: Signature: Signature:
044 045 046

RECEIPT RECEIPT RECEIPT

Date: Date: Date:

Received from: Received from: Received from:

Sum of Sum of Sum of

In payment of In payment of In payment of

For Ntombi’s Services For Ntombi’s Services For Ntombi’s Services

Signature: Signature: Signature:
047 048 049

44
Re-write the transactions into your own words.

NOTE: An income increases Owner's Equity

ACCOUNTING EQUATION

TRANSACTION
A = O/E + L
e.g. Issued receipt no. 041 to B. Bahke
02 + 85 + 85
for services rendered

03

03

05

07

13

24

29

30

· The "Analysis of receipts" column is a breakdown of the money received. It is not an

account so it is not totalled.
Ÿ Bank daily. Show this by underlining the last receipt of the day in the "Analysis of
receipts" column. Bank the total receipts under the ‘Bank’ column).

CASH RECEIPTS JOURNAL OF NTOMBI SERVICES FOR JULY 20___ CRJ 6_ AR

HE YE
H OF T
MONT
DOC DATE DETAILS ANALYSIS BANK CURRENT SUNDRY ACCOUNTS
OF INCOME
RECEIPTS AMOUNT DETAILS

041 02 B BAHKE 85.00 85.00 85.00

042 03 P. PHUMIZILE 85.00 85.00
043 03 Z. ZUMA 85.00 170.00 85.00
05 Capital

07
13
24
29
30
1015.00 515.00 500.00

(10)

Test yourself * Bank must be = The sum of the Current Income and Sundry Accounts

45
EXERCISE 9 Date: ___________

Ntombi Dlamini is the proud owner of an informal business. She

washes windows in her neighbourhood. Ntombi also does other little
jobs for extra income. Ntombi issues receipts to prove her income.
Record the duplicate receipts for August 20_______ into the CRJ of
"Ntombi's Services"

1 Receipt no 50 issued to B Bonto for baby sitting services, R 50, 00

2 Issued receipt to H Hlomo for house cleaning services, R 150, 00
5 Issued receipt to N Nomo, for fetching her children from school and
doing homework with them R 150, 00
6 Issued 2 receipts for R 50 each. One to B Bonto for window washing and the other to
D Dlamini for fetching water for the week.
7 Issued receipt to S Simelane, R 75, 00 for services rendered at the informal market.
8 Issued receipt to D Dlamini for plaiting her two little girls' hair for a function, R 50, 00
9 Issued receipt to J Zuma, for helping with wedding preparations, R 100, 00.
10 Increased her Capital contribution by R 300, 00
CASH RECEIPTS JOURNAL OF FOR CRJ

ANALYSIS CURRENT SUNDRY ACCOUNTS

DOC DATE DETAILS OF BANK INCOME
RECEIPTS AMOUNT DETAILS

Analyse the transactions and show their effect on the Accounting Equation.

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

01

02

05

07

09

46
 EXERCISE 10 Date: ___________
D. Carefully is the owner of “SAFETY DRIVING SCHOOL”.
He provides his customers with driving lessons and prepares them
for their learners licence test.
R65,00 per lesson (per hour) using own vehicle
R95,00 per lesson (per hour) if using the driving
school’s transport
R100,00 per lesson (per hour) prepare for learners
written test.

These are the duplicate receipts in his receipt book for June 20 ____

Clue: Remember to check for transactions that take place on the

same day.

01 Receipt no 031 R 300, 00 W Harris to prepare her for a written test (3 Hours)
02 032 R 65, 00 to K Kimble for driving lesson
03 033 R 95, 00 to R Riddley for driving lesson
03 034 R 130, 00 to K Kimble for 2 driving lessons
03 035 R 190, 00 to S Scott for 2 driving lessons
04 036 R 100, 00 P Parker to prepare him for his written test
05 037 R 500, 00 D Carefully for capital contribution

These are the totals of the duplicate till slips for services rendered at the end of the following days

02 R 235, 00
04 R 345, 00

CASH RECEIPTS JOURNAL OF FOR CRJ

ANALYSIS CURRENT SUNDRY ACCOUNTS

DOC DATE DETAILS OF BANK INCOME
RECEIPTS AMOUNT DETAILS

47
EXERCISE 11 Date: ___________
D. Carefully is the owner of “Safety Driving School”. He provides his customers with
driving lessons and prepares them for their learners licence test.

Prices are as follows:

R65,00 per lesson (per hour) using own vehicle

R95,00 per lesson (per hour) if using the driving
school’s transport
R100,00 per lesson (per hour) prepare for learners
written test.

He mostly issues handwritten receipts but occasionally

uses his till. These are the cash receipts for the month of July 2006

! Enter the transactions into the CRJ of “SAFETY DRIVING SCHOOL”.

! Analyse the transactions and show their overall effect on the Accounting Equation.

1 Issued receipt, number 024 to G. Guy for R65,00

1 Cash receipts as per cash register roll for the day R795,00
2 Issued receipts to B Bloem for 2 hours driving lesson. He used his own car.
2 Services rendered as per cash register roll for the day R900,00
3 The owner increased his capital contribution by R 7 500,00
4 Issued a receipt to R Rose for a garage he rents to her for R75,00 per month (rent)
income)

DUPLICATE RECEIPTS

RECEIPT RECEIPT RECEIPT

Date: 05/06/06 Date: 07/06/06 Date: 09/06/06

Received from: R. Royce Received from: B. Blignaut Received from: C. Carmen

Sum of R130.00 Sum of ? Sum of ?

In payment of In payment of In payment of
2 driving lessons - own vehicle 2 driving lessons - company vehicle 2 hours to prepare for learners

For D. Carefully For D. Carefully For D. Carefully

Signature: D. Carefully Signature: D. Carefully Signature: D. Carefully
028 029 ?

DUPLICATE TILL SLIPS

05/06 08/06 11/06 15/06

Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop

Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop

Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop

Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop

Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop

Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop

Cash R 320.00 Cash R 85.00 Cash R 650.00 Cash R 310.00

Thank you for Thank you for Thank you for Thank you for
your support your support your support your support

48
3. Rewrite the transactions from the 5th - 15th into your own words.

Accounting Equation
ACCOUNTING EQUATION

TRANSACTION
A = O/E + L
01

01

02

02

03

04

05

05

07

08

09

11

15

CASH RECEIPTS JOURNAL OF __________________FOR ________________CRJ ___

DOC DATE DETAILS ANALYSIS BANK CURRENT SUNDRY ACCOUNTS
OF INCOME
RECEIPTS AMOUNT DETAILS

024 01
01 Sales
02 130.00
02 1 030.00 900.00
026 03 D. Carefully Capital
04 Rent income
05
05 Sales

07
08
09

11

15

11 350.00 3 775.00 7 575.00

49
EXERCISE 12 Date: ___________

W. Gietl is the owner of "Live Concerts" and is a Disc Jockey (DJ). He plays music for
all occasions.
According to his receipt book, these are the transactions that took
place for the month of August 20______

Record the transactions into the CRJ

1 Issued receipt 17 to F. Frog for D Jaying service R2 000.00

2 The owner increased his capital contribution by R5 000.00
5 Rented his lighting to S. Sugar and issued him a receipt for
R700.00
6 V. Valerie paid for her Wedding party. Wade issued her a
receipt for R1 500.00
7 Issued receipt to P. Payne for 21st Birthday party R2 000.00

CASH RECEIPTS JOURNAL OF FOR CRJ

ANALYSIS CURRENT SUNDRY ACCOUNTS

DOC DATE DETAILS OF BANK
INCOME
RECEIPTS AMOUNT FOL DETAILS

17 01 F. Frog 2 000.00 2 000.00 2 000.00

Analyse the transactions and show their effect on the Accounting Equation.

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

01

02

05

06

07

50
 RECEIPT
RECORDING CASH RECEIPTS OF A BUSINESS THAT TRADES BOOK

PJ Potgieter is the owner of PJ Wholesalers and his company sells books

to schools. These are the cash sales from the 25th July 20_____. His profit
mark up is 22%. Some transactions include other receipts i.e. rent incomes
and capital.

SP 100
CP = X
1 (100 + % m.u.)

ACTIVITY 3

You are the bookkeeper for PJ Wholesalers. Enter the following cash receipts in the CRJ
and total the Bank, Sales, Cost of Sales and Sundry accounts.
25 Cash sales as per cash register roll R3320,00
25 Issued receipt no. 04 to Wordsworth High School for books sold R1470,00.
26 Issued receipt to W Wayne R1500, for office space rent to him.
27 PJ Potgieter rents part of his building to R Fisher and Co. Issues receipt for rent
income R2700,00
27 Cash sales as per CRR R7250,00
28 Issued receipt to Willowmoore High School for books delivered. R1250,00
31 Issued receipt to PJ Potgieter for R5000,00. He increased his capital.

CASH RECEIPTS JOURNAL OF PJ WHOLESALERS FOR CRJ

DOC. DATE ANALYSIS COST OF SUNDRY ACCOUNTS
DETAILS OF BANK SALES
NO. SALES
RECEIPTS AMOUNT DETAILS
25 Sales 3320.00 3320.00 2721.31
04 25 Wordsworth 1470.00 4790.00 1470.00 1204.92
Rent
05 26 W. Wayne 1500.00 1500.00 1500.00 Income

22490.00 13290.00 10893.44 9200.00

Test yourself * Bank = Sales and Sundry Accounts

The "Analysis of receipts" column is a breakdown of

·

NOTE: the money received. It is not an account so it is not

totalled.
Ÿ Bank daily. Show this by underlining the last
receipt of the day in the "Analysis of receipts"
column. Bank the total receipts under the ‘Bank’
column).

51
EXERCISE 13 Date: ___________

R. Solice owns "Rose Candles". She makes candles. SP 100

These are her receipts for January 20________ CP = X
1 (100 + % m.u.)
The % m.u. is 33%

Enter the transactions into the CRJ of "Rose Candles".

01 Issued receipt no 71 for candles to S. Silley, R2500

02 Issued receipt to F. Friend for wedding candles R5000.00
02 R. Solice increased her capital contribution by R5000
03 Cash sales according to CRR R500
04 Sold R700 worth of candles to SPAR and issued a receipt.
05 Sold bath candles to the Bubble Shop R600 and issued a receipt
05 Sold scented candles to Clicks for Valentines day and issued a receipt R500
18 Issued a receipt to Flowers Galore for candles R500.00
24 Issued a receipt to SA Weddings for Candles R2000
25 Cash Sales according to CRR R350.00

CASH RECEIPTS JOURNAL OF For CRJ ___

ANALYSIS COST SUNDRY ACCOUNTS

DOC DATE DETAILS OF BANK SALES OF
RECEIPTS
SALES AMOUNT DETAILS

Analyse the following transactions and show their effect on the Accounting Equation.

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

01

03

24

52
EXERCISE 14 Date: ___________

R. Solice owns "Rose Candles". She makes candles. SP 100

CP = X
These are her receipts for February 20________ 1 (100 + % m.u.)

She decided to increase her % m.u. to 35%

Enter the transactions into the CRJ of "Rose Candles".

01 Issued receipt no 80 for candles to S. Spacey, R 1 250, 00

02 Issued receipt to R Roper for centerpiece candles R 3 200, 00
03 R. Solice increased her capital contribution by R 1 500, 00
03 Cash sales according to CRR R 3 500, 00
05 Sold R 2 000, 00 worth of candles to Woolworths and issued a receipt.
06 Sold bath candles to the Bubble Shop R 800 and issued a receipt
07 Sold more scented Valentines candles to Clicks, issued a receipt
R500, 00
17 Issued a receipt to Flowers Galore for candles R 1 500, 00
21 Issued a receipt to SA Weddings for Candles R 2 500, 00
24 Cash Sales according to CRR R 1 350, 00
CASH RECEIPTS JOURNAL OF For CRJ ___

ANALYSIS COST SUNDRY ACCOUNTS

DOC DATE DETAILS OF BANK SALES OF
RECEIPTS
SALES AMOUNT DETAILS

Analyse the following transactions and show their effect on the Accounting Equation.

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

01

05

24

53
EXERCISE 15 Date: ___________

R. Solice owns "Rose Candles". She makes candles. SP 100

CP = X
These are her receipts for March 20_______ 1 (100 + % m.u.)

Her % m.u. is 35,33%

Enter the transactions into the CRJ of "Rose Candles".

01 Issued receipt no 90 for candles to P Pollock, R 1 750, 00

01 Issued receipt to F Francis for scented candles R 1 200, 00
07 R. Solice increased her capital contribution by R 500, 00
09 Cash sales according to CRR R 5 200, 00
15 Sold R 1 200, 00 worth of candles to Pick n' Pay and issued a receipt.
16 Sold rose candles to the Bubble Shop R 1 800 and issued a receipt
16 Sold scented candles to Terrace Pharmacy issued a receipt R500, 00
27 Issued a receipt to Dischem for candles R 1 350, 00
29 Issued a receipt to M Macy for wedding candles R 2 500, 00
30 Cash Sales according to CRR R 4 350, 00

CASH RECEIPTS JOURNAL OF For CRJ ___

ANALYSIS COST SUNDRY ACCOUNTS

DOC DATE DETAILS OF BANK SALES OF
RECEIPTS
SALES AMOUNT DETAILS

Analyse the following transactions and show their effect on the Accounting Equation.

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

07

15

30

54
EXERCISE 16 Date: ___________
C. Cindy owns "Candy Love" . She makes home made chocolates.
Her % m.u. on her chocolates is 45%
These are her duplicate receipt details for
March 20________ SP 100
CP = X
1 (100 + % m.u.)
Enter the transactions into the CRJ

01 Receipt no. 25 to V. Valentine for chocolates R200

02 Issued receipt to SPAR for chocolate easter eggs R700
03 Issued receipt to The Tuck Shop for chocolates R300
04 Issued receipt to Wiessenhof for chocolate spoons R700,00
Cash Sales according the the CRR R500.00
14 C. Cindy increased her Capital contribution by R2000
17 Issued receipt to F. Frost for chocolate moulds R600
(Her mark up on the moulds is 25%)
18 Issued receipt to The Holiday Inn for Liquor Chocolates, R1500
29 Issued receipt to F. Frost for chocolate moulds R1600.00
30 Cash Sales according to the CRR R750

CASH RECEIPTS JOURNAL OF FOR CRJ ___

ANALYSIS COST SUNDRY ACCOUNTS
DOC DATE DETAILS OF BANK SALES OF
RECEIPTS
SALES AMOUNT DETAILS

Analyse the following transactions and show their effect on the Accounting Equation.

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

17

18

55
EXERCISE 17 Date: ___________
C. Cindy owns "Candy Love" . She makes home made chocolates.
Her % m.u. on her chocolates is 43%
These are her duplicate receipt details for SP 100
January 20________ CP = 1 (100 + % m.u.)
Enter the transactions into the CRJ

01 Receipt no. 07 to Sweet Tooth for chocolates R 215, 50

03 Issued receipt to J Smith for caramel filled chocolates R 205, 00
03 Issued receipt to The Tuck Shop for chocolates R 150, 00
05 Issued receipt to Mugg & Bean for chocolate spoons R 300, 00
Cash Sales according the the CRR R 1 200, 00
13 C. Cindy increased her Capital contribution by R 500, 00
19 Issued receipt to F Beyers for chocolate moulds R 155, 00
(Her mark up on the moulds is 25%)
21 Issued receipt to The Holiday Inn for Pillow chocolates, R 1 200, 00
28 Issued receipt to R Simms for chocolate moulds R 1 100, 00
29 Cash Sales according to the CRR R 550, 50

CASH RECEIPTS JOURNAL OF FOR CRJ ___

ANALYSIS COST SUNDRY ACCOUNTS
DOC DATE DETAILS OF BANK SALES OF
RECEIPTS
SALES AMOUNT DETAILS

Analyse the following transactions and show their effect on the Accounting Equation.

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

13

21

56
EXERCISE 18 Date: ___________
C. Cindy owns "Candy Love" . She makes home made chocolates.
C. Cindy increade her % m.u. on her chocolates is 44,33%
These are her duplicate receipt details for SP 100
February 20________ CP =
1 (100 + % m.u.)
Enter the transactions into the CRJ

01 Receipt no. 15 to P. Cupid for heart chocolates R 250, 00

02 Issued receipt to SPAR for Valentine chocolates R 700, 00
03 Issued receipt to The Tuck Shop for chocolates R 320, 50
04 Issued receipt to Cup & Chatter for chocolate spoons R 320,00
Cash Sales according the the CRR R 3 525.00
14 C. Cindy increased her Capital contribution by R 1 000, 00
17 Issued receipt to Bride & Co for "Thank you" chocolates R 1 200, 50
Issued receipt to Uni Florist for Gift hamper chocolates R 2 450, 00
18 Issued receipt to Tony's for Slabs of Swirl chocolate R 650, 00
27 Issued receipt to Little Sunshine for Heart moulds R 450, 00 (24% m.u)
28 Cash Sales according to the CRR R 699, 00

CASH RECEIPTS JOURNAL OF FOR CRJ ___

ANALYSIS COST SUNDRY ACCOUNTS
DOC DATE DETAILS OF BANK SALES OF
RECEIPTS
SALES AMOUNT DETAILS

Analyse the following transactions and show their effect on the Accounting Equation.

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

18

28

57
 RECEIPT
BOOK

RECORDING CASH RECEIPTS OF A BUSINESS THAT TRADES AND

OR PROVIDES A SERVICE

ACTIVITY 4 SP 100
CP = X
1 (100 + % m.u.)

PR Simon owns Woodstock. She sells and repairs bicycles.

You are the bookkeeper for Woodstock. Record the following cash receipts in the CRJ
of Woodstock. Total the accounts.

22 Issued receipt no. 516 for R329,00 for puncture kits sold to KK Wholesalers.
(Cost price R270,00).
22 Cash register roll shows cash sales of the day R2575,00 (Cost price R1750)
23 Cash received for repairs, cash register roll R327,00
24 PR Simon increases her capital by R 50 000,00 a receipt is issued to her.
25 Sold bicycle to M Mark. Issued receipt for R 2 000,00 (50% m.u).
25 R Wilson insists on a receipt as proof of payment for repairs done to his bicycle
R 2 215,00.
26 Repairs done as per CRR, R397,00

CASH RECEIPTS JOURNAL OF WOODSTOCK FOR JUNE CRJ

DOC.DATE DETAILS ANALYSIS
BANK CURRENT SALES COST OF SUNDRY ACCOUNTS
NO. OF INCOME SALES
RECEIPTS AMOUNT DETAILS

516 22 KK Wholesales 329.00 329.00 270.00

22 Sales 2575.00 2904.00 2575.00 1750.00

23 Cash Sales 327.00 327.00 327.00

57843.00 2 939.00 4904.00 3353.33 50000.00

ACTIVITY 5 DATE: 24/06/

TO: Thabazimbi Mun.
Include the deposit made on the 24/6 and balance
FOR: Water & Electricity
the cheque book of Woodstock cc.
BALANCE: R13 275.00
DEPOSIT: .......... A
THIS CHEQUE:

R 325.55
BALANCE: .......... B
055
58
EXERCISE 19 Date: ___________

Miss C. Fitzgerald owns "Cards by Claire". She makes and sells cards for all occasions.

Her selling price per card is R25.00 and her mark up is 120%. SP 100
CP = X
Claire also gives lessons on how to make cards every 1 (100 + % m.u.)
Saturday @ R100 per lesson.

Record the receipts of "Cards by Claire" in the CRJ of September 20________

01 Issued receipt no. 41 to R. Rowan for 30 cards.

02 Issued receipt for R250.00 to C. Civin for birthday cards.
05 Cash Sales for the day according to the CRR, R500
05 Issued receipt to B. Blomm for 2 lessons
06 Issued receipt to A. After for 4 lessons
06 Issued receipt to D. Darwin for 50 cards
09 Issued receipt to Y. Yoga for R1000.00 for cards
28 Issued receipt to A. Blomm for another 2 lessons
29 Cash Sales according to the CRR R2000
30 Increased her capital contribution by R2000,00

CASH RECEIPTS JOURNAL OF FOR CRJ ____

ANALYSIS COST SUNDRY ACCOUNTS
DOC DATE DETAILS OF BANK SALES OF
RECEIPTS
SALES AMOUNT DETAILS

Analyse the transactions and show their effect on the Accounting Equation.

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

06
+1250 +1250
06 - 568.18 - 568.18

59
EXERCISE 20 Date: ___________
Mrs. Henley of SA Florists had the following income for April 20_____. The cash register was used to
record cash sales and receipts were issued for garden
services rendered. Her mark up on cash sales was 44%. SP 100
CP = X
! Record the transactions in the Cash Receipts Journal 1 (100 + % m.u.)
of SA Florists and total the accounts.

02 Issued receipt number 843 to Mrs. Daisy for payment of garden services
provided to her, R 280.00.
03 Mrs. Steward paid R 350.00 for services rendered, issued him a receipt.
03 For a once off clean up, received R 5 000.00 from Mr. Hanson. Issued
him a receipt.
04 Cash sales according to the Cash Register Roll (CRR), R 3 750.43.
05 Mrs. Henley increased her capital contribution by R 7000.00. Issued her
a receipt.
08 Cash sales according to the CRR, R 432.99.
08 Received R 435.00 from Mrs. Harris for garden service fees.
11 Received R 2 500.00 from Mr. Busy for office space rent to him. Issued him a receipt.
14 Cash sales according to the CRR, R 3 592.55.
15 Cash sales according to the CRR, R 9 567.00.
17 Carted garden rubble away for Mrs. Gibbson and received R 2 500.00 for the job.
21 Mrs. Henley increases her financial stake in the business by R 5 000.00. A receipt was issued.
23 Cash sales according to the CRR R 4 567.90.
23 Issued a receipt to Mrs. Scott for R 280.00 for garden services rendered to her.
24 Cash sales according to the CRR, R 782.00.
26 Cash sales according to the CRR, R 542.00.
29 Received a late payment for garden services rendered from P. Peters, R 300.00.

CASH RECEIPTS JOURNAL OF FOR CRJ

ANALYSIS COST SUNDRY ACCOUNTS
OF OF CURRENT
DOC DATE DETAILS RECEIPTS BANK SALES SALES INCOME AMOUNT FOL DETAILS

60
SOURCE DOCUMENTS (Step 2)

2. THE CHEQUE

The business has money in its bank/current account. A cheque is issued by the
owner instructing the bank to pay the goods or service provider the amount
written on the cheque.

A. Bank
B. Branch code
T
C. Cheque number (Document number) in chronological order - number order
D. Bank account number
E. Account holder (Drawer = Payer) and signature of authorisation.
F. Name of company/person to be paid (Drawee = Payee)
G. Whoever is in possession of the cheque. ‘Or bearer’ must be crossed out to
prevent the wrong person from banking the cheque. A cash cheque is not crossed.
H. The amount being paid, written out in words.
I. The amount in Rands and cents.
J. The date that the payment is made.
K. T Cheque counterfoil which is the source document (proof of payment).

The cheque itself is torn out along the perforation and issued to the
service provider.
L. Opening bank balance before the cheque is issued.
M. Closing bank balance after the cheque is issued.
N. Not transferable - crossing of the cheque. This is a measure brought into effect by
banks to prevent fraud. Only the person/businesses name to whom the cheque is
made out, may bank the cheque into their account.
O. To balance a cheque book, any deposits need to be recorded.
P. Specify what the payment is for.

B 290-251
DATE: J 25/03/05 A N BLE
RA
TO: F R. Roper D DIZZY BANK ANS
FE
DATE: J 25/03/20
TR
FOR: P Stationery
T
NO
BALANCE: R4 925.00 L G OR BEARER
PAY F R. Roper
DEPOSIT: O
THIS CHEQUE: THE SUM OF H Five hundred and seventy five rand only

I R 575.00 I R 575.00

BALANCE: R4 350.00 M
E
C 003 003 C 572631052986 D PJ WHOLERSALERS

K
Cheque Counterfoil

PAYS MONEY RECEIVES MONEY

Drawer = Payer Drawee = Payee

61
 JOURNALS
RECORDING CHEQUE PAYMENTS (Step 3)
(CASH PAYMENTS JOURNAL)
Payments made by cheque are recorded in the T
Cash Payments Journal (CPJ). This is
done daily.
The name of .the person or business to whom the
NOTE: cheque is payable, is written in the “details of payee ” column
of the CPJ

PJ Potgieter is the owner of PJ Wholesalers and sells books to schools. He started

recording the transactions of his business on the 25/07/05.

DATE: 25/07/20
Re-write the transaction in your own words, using
Cheque Counterfoil

TO: Wamark
the information provided on the cheque counterfoil
FOR: Trading Inventory

BALANCE: R17525.00
DEPOSIT: -
THIS CHEQUE: R3750.00
BALANCE: R13775.00

027

The next cheque payment of PJ Wholesalers for July 2005

DATE: 26/07/20
Write the transaction in your own word
Cheque Counterfoil

TO: Ekhuruleni Municipality

FOR: Water & Electricity

BALANCE: R13 775.00

DEPOSIT: -
THIS CHEQUE: R725.00
BALANCE: R13 050.00

028

There are only three accounts in this CPJ namely: Bank wages and Trading Inventory. This
is how you will record this transaction under the ‘Sundry accounts’ column. If there is no
column for the account affected e.g. Water and Electricity, the account must be detailed
under the ‘sundry accounts’ column.

CASH PAYMENTS JOURNAL OF PJ WHOLESALERS FOR JULY 2020 KBJ 07

DOC. TRADING SUNDRY ACCOUNTS

DATE DETAILS BANK WAGES
NO. OF PAYEE INVENTORY AMOUNT DETAILS
027 25 Wamark 3 750.00 3 750.00
Water &
028 26 Ekurhuleni 725.00 725.00 Elec.

13 734.00 3 000.00 4 179.00 6 555.00

62
If one had to draw a cheque counterfoil for each transaction it would take up too much
space. Therefore the cheque payments from the 26th to the 31st of July will be explained
in words.

You are the bookkeeper for PJ Wholesalers. Enter the following payments in the Cash
Payments Journal of PJ Wholesalers and total (add up) the ‘Bank’, ‘Wages’, ‘Trading
Inventory’, and ‘Sundry Accounts’ columns.

26 The owner PJ Potgieter issues a cheque to Luthes Print for books delivered
R429,00 (Cheque numbers are in succession)

27 Paid RT Supplies by cheque for boxes R330,00

28 Issued cheque to VW Volkswagen for a secondhand delivery vehicle R 5000.00

31 Cashed cheque to pay wages R 3000.00 (For the owner to draw cash from the
business bank account, the cheque will be written out to ‘cash’. ‘Cash’ will be the
‘details of payee’ column of your CPJ)

31 PJ Potgieter cashes cheque for personal use, R500 (drawings)

Analyse the following transactions and show their effect on the Accounting Equation

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

25

26

26

27

28

31

31

63
64
 POST TRANSACTIONS TO THE CPJ

POST TOTALS AND SUNDRY TRANSACTIONS

FROM THE CPJ
TO THE GENERAL LEDGER
POSTING RULES

DR CR

65
EXERCISE 21 Date: ___________

(Tick ü the source document and relevant journal on page 24)

C. Cindy the owner of "Candy Love" made the following payments by

cheque in March 20_______

Record the transactions into the Cash Payments Journal.

01 Issued cheque no. 421 to Cadburys for chocolate R700 (Material costs)
02 Issued cheque to A. Arts for ribbon and packets (Packaging material) R370
02 Issued cheque to Game for new pots to melt the chocolate R2500 (Equipment)
04 Issued cheque to M. Moulds for chocolate moulds R300 (Equipment)
07 Issued cheque to Game for travelling cases for an overseas trip (Drawings) R700
08 Cashed a cheque to pay wages R900.00
09 Cashed a cheque to make a donation of R500

CASH PAYMENTS JOURNAL OF FOR CPJ ___

SUNDRY ACCOUNTS
DOC DATE DETAILS OF BANK EQUIPMENT PACKAGING
MATERIAL
DRAWINGS
PAYEE AMOUNT DETAILS

Analyse the following transactions and show their effect on the Accounting Equation.

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

01

04

07

66
EXERCISE 22 Date: ___________
D Carefully of "Safety Driving School" issued the following cheques for the month
of February 20______ These are the details as per the cheque counterfoils
• Enter the transactions into the Cash Payments Journal
Date Cheque Amount
Cheque Counterfoil Details
number (R’s)
01 222 E Engen - Repairs 1 975, 00
02 223 Cash - Fuel 900, 00
03 224 Cash - Wages 3 250, 00
06 225 Monarch Properties - Rent 4 350, 00
07 226 Hi Fi Corp - Machinery 3 835,00
09 227 Vodacom (Cell phones) 650, 00
10 228 Dent Doctor - Repairs 1 135, 00
11 229 Cash - Wages 3 250, 00
15 230 AA - Insurance 500, 00
18 231 Caxton - Advertising 750, 00

CASH PAYMENTS JOURNAL OF For CPJ ____

SUNDRY ACCOUNTS
DOC DATE DETAILS OF PAYEE BANK FUEL REPAIRS
AMOUNT DETAILS

Analyse the following transactions and show their effect on the Accounting Equation.

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

01

07

67
EXERCISE 23 Date: ___________

D Carefully of "Safety Driving School" issued the following cheques for the month of
March 20________

• Enter the transactions into the Cash Payments Journal

01 Issued cheque number 231 to Caltex for Fuel R750.00

03 Issued cheque to AA for Insurance R75
03 Issued cheque to PPlus for Advertising R550
04 Issued cheque to Speedy for a new Vehicle R75 000
05 Paid the Salaries of E. Black per cheque, R7 000
07 Cashed cheque to pay R1500.00 (Rent Expense)
18 Issued cheque to Caltex for Fuel R900
25 Paid E. Engen for repairs R500
28 Paid E. Engen for fuel R700.00

CASH PAYMENTS JOURNAL OF For CPJ ____

SUNDRY ACCOUNTS
DOC DATE DETAILS OF PAYEE BANK FUEL REPAIRS
AMOUNT DETAILS

Analyse the following transactions and show their effect on the Accounting Equation.

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

01

04

68
EXERCISE 24 Date: ___________

Miss C. Fitzgerald owns "Cards by Claire".

These are her cheque payments for September 20_______

• Record the transactions in the Cash Payments Journal for

September 2009

02 Issued cheque no. 709 for cardboard and paper (Material) R350.00 to CC Paper
04 Paid CNA for ribbon R300 (Material) by cheque
05 Issued cheque to B.Box for envelopes and plastic sleeves. R 700
07 Issued cheque to R. Ryan for rent (Rent Expense) R1500
08 Issued cheque to Ekhuruleni Municipality for R500 for Water & Electricity
09 Cashed a cheque for R900 for wages
10 Cashed a cheque for personal use R200 (C. Fitzgerald)
29 Issued a cheque to CC Papers for cardboard R300
30 Issued a cheque to RS Suppliers for envelopes R200
Issued a cheque to B. Box for boxes and bubble wrap, R700

CASH PAYMENTS JOURNAL OF For CRJ ____

SUNDRY ACCOUNTS
DOC DATE DETAILS OF BANK MATERIAL PACKAGING
PAYEE COSTS MATERIAL AMOUNT DETAILS

Analyse the following transactions to show the effect on the Accounting Equation

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

05

10

69
EXERCISE 25
Date: ___________
Miss C. Fitzgerald owns "Cards by Claire".

These are her cheque payments for October 20_____ Post the transactions to the CPJ.

Date Cheque Cheque Counterfoil Details Amount (R’s)

number
01 719 PNA – Decorations (Materials) 1 245, 75
03 720 P Print - Advertising 980, 00
03 721 Cash - Wages 2 660, 00
09 722 R Ryan - Rent 4 350, 00
12 723 Hi Fi Corp - Machinery 4 835,00
15 724 Telkom - Telephone 857, 29
18 725 Game – Colour Printer 1 135, 99
24 726 Cash - Wages 2 660, 00
27 727 PNA – Packaging 212, 00
28 728 Cash - Lunches 450, 00

CASH PAYMENTS JOURNAL OF For CRJ ____

SUNDRY ACCOUNTS
DOC DATE DETAILS OF BANK MATERIAL PACKAGING
PAYEE COSTS MATERIAL AMOUNT DETAILS

Analyse the following transactions to show the effect on the Accounting Equation

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

09

12

70
EXERCISE 26 Date: ___________

Mrs. Henley owns SA Florists.

She sells flower arrangements and vases.
The following cheques were issued for April 20_______

! Show how these transactions would have been entered

into the Cash Payments Journal, and total the accounts.

01 Issued cheque number 234 to Interior Design Co.

for vases, R 6 253.00 (Trading Inventory).
02 Paid rental by cheque to R. Row, R 3 200.00 (Rent expense).
03 Issued cash cheque to pay for wages. R 1 500.00.
04 Paid by cheque for flowers from Flower Power. R 1 200.00. (Trading Inventory).
05 Paid WW Motors for a new delivery vehicle by cheque. R 23 000.00.
Cashed a cheque to fill up the vehicle with fuel. R 250.00.
07 Issued a cheque to Benoni High School for her son’s school fees.
R 650.00.(Drawings)
09 Paid by cheque for boxes and ribbons bought from the Boxing Co.
R 325.00.(Packaging Materials)
Issued a cheque to RJ Wholesalers for mesh, oasis and plastic containers.
R 5 221.00. (Material costs)
15 Bought more flowers from Flower Power and paid by cheque, R 973.22. (Trading
inventory)
Issued cheque to Ekurhuleni Municipality for water and electricity, R 575.00.
16 Mrs. Henley cashed a cheque for R 300.00 to take her sister to lunch. (Henley)
25 Cashed a cheque to pay wages R 3 500.00.
26 Bought a new walk - in - fridge from Dions and paid by cheque. R 3 500.00.
(Equipment)
CASH PAYMENTS JOURNAL OF FOR CPJ

SUNDRY ACCOUNTS
DOC DATE DETAILS OF BANK WAGES TRADING FUEL
PAYEE INVENTORY AMOUNT DETAILS

71
EXERCISE 27 Date: ___________

P. Green is the owner of Green Fingers Garden Service.

The following receipts were issued and payments made for August 20_______. Record the
transactions into the CRJ and CPJ.

01 Issued receipt no. 28 to G. Player for services rendered R 250

02 Issued a receipt to S. Sawyer for refuse removal R 40
Issued cheque no 118 to P. Plum for a new lawnmower. R 3 000 (Machinery)
03 Issued receipt to F. Franklin for tree felling R 700
Issued cheque to C. Claw for new gardening equipment R 2 300
04 Issued receipt to P. Plier for general gardening maintenance R 300
Issued cheque to F. Fixit for repairs to the lawnmower, R 620
Cashed a cheque for fuel R 450
07 Capital contribution R 7 000
Paid by cheque for a new trailer from SA Motors, R 17 000 (Vehicles)
08 Cashed a cheque for wages R 3 500
11 Issued a receipt to W. Wheeler for a 'Once up, clean up' R 800
Issued a receipt to B. Bee for services rendered R 300
12 Cashed a cheque for personal use R 250 (P. Green)
19 Paid S. Sewer for compost (Material cost) R 1 500
27 Issued receipt to S. Sawyer for monthly service fee R 500
29 Cashed a cheque for fuel, R 450
30 Increased Capital contribution to R 9 000
Cashed a cheque for personal use R 1 000 (P. Green)

Analyse the following transactions and show their effect on the Accounting Equation.

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

02

02
08
30

72
EXERCISE 27

CASH RECEIPTS JOURNAL OF FOR CRJ

ANALYSIS CURRENT SUNDRY ACCOUNTS

DOC DATE DETAILS OF BANK INCOME
RECEIPTS AMOUNT DETAILS

CASH PAYMENTS JOURNAL OF FOR CPJ ___

SUNDRY ACCOUNTS
DOC DATE DETAILS OF BANK FUEL DRAWINGS
PAYEE AMOUNT DETAILS

73
 EXERCISE 28 Date: ___________

P. Green is the owner of Green Fingers Garden Service.

The following receipts and cheques were issued for September 20________
Record the transactions into the CRJ and CPJ.

01 Issued receipt number 37 to J. Julie for R 450 for monthly service fee.
02 Issued cheque number 128 to F. Fixit for repairs done to the lawnmower, R 975
Cashed a cheque for fuel, R 600
03 P. Green increased his capital contribution by R 2000
Issued receipt to J. Johnson for R 350 for once up cleaning
Cashed a cheque for wages, R 2 550
05 Bought compost (Material Costs) from Heckers Nursery, paid by cheque, R R 350
06 Issued a receipt to B. Bright for R 250 for pruning services
Received R 300 for services rendered from M. Mary
S. Snap paid R 450 for tree felling. Issued receipt
07 Bought a spade and shears (equipment) from Makro, and paid R 835 by cheque
08 Issued cheuqe to Vodacom for internet services, R 650
Paid F. Fixit for spares by cheque, R 1 135
09 D. Duncan paid R 350 for pruning of his hedges and and extra R 200 for high pressure
cleaning his driveway.
Cashed a cheque for wages, R 2 550
11 P. Green issued a cheque to the Holiday Inn for a deposit on a holiday, R 5 500
12 Issued a receipt to D. Delf for a deposit to remove rubble, 50% of R 520
13 Cashed a cheque for vehicle licence renewal, R 325
15 Issued a receipt for balance owing by D.Delf
25 Issued two receipts. The first one to K. Klim for monthly service fee of R 550 and
the second to J. Johnson for removal of a tree stump, R 225

Analyse the transactions and show their effect on the Accounting Equation.

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

07

09

13
15

74
EXERCISE 28 Date: ___________

CASH RECEIPTS JOURNAL OF FOR CRJ

ANALYSIS CURRENT SUNDRY ACCOUNTS
DOC DATE DETAILS OF BANK INCOME
RECEIPTS AMOUNT DETAILS

CASH PAYMENTS JOURNAL OF FOR CPJ ___

SUNDRY ACCOUNTS
DOC DATE DETAILS OF BANK FUEL DRAWINGS
PAYEE AMOUNT DETAILS

75
EXERCISE 29 Date: ___________

W Gietl owns "Lives Concerts". He is expanding his business to include hiring out of his
equipment.

The following receipts and cheques were issued for August 20________
Record the transactions into the CRJ and CPJ.

01 P. Player hired 2 base bins from Gietl @ R300 each. Issued receipt number 32
02 Gietl increased his Capital contribution by R 25 000
Issued cheque no. 124 for new speakers to Sounds Unlimited R 4 500
03 Issued a receipt to DJ Joe for hiring of lighting and DJ decks R 2 500
Issued cheque to Sounds Unlimited for new earphones, R 2000
04 Issued a receipt to F. Functions for a gig, R 3 500
Received a deposit from A Arbor R 3 500
Cashed a cheque for fuel, R 350
05 Issued a cheque to S. Store for storage facilities, R 350
06 Cashed a cheque to by new clothes R 600 (W.Gietl)
07 A. Arbor paid a further R 2000 for DJ services
Issued a cheque to Look and Listen for CD's R 700 (Equipment)
08 DJ Yo paid R 3 300 for DJ decks, issued a receipt
W Gietl played a set at H2O and banked R 5 200
12 Issued a receipt to D. Daisy for a deposit to play at her wedding,
50% of R 5 520
13 Issued a receipt for 2 hours overtime played at P. Peter's 21st @ R 450 per hour

(Show the effect of these transactions on

the Accounting equation) ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

02

02

03

04

05

06

07

13

76
EXERCISE 29 Date: ___________

CASH RECEIPTS JOURNAL OF FOR CRJ

ANALYSIS CURRENT SUNDRY ACCOUNTS

DOC DATE DETAILS OF BANK INCOME
RECEIPTS AMOUNT DETAILS

CASH PAYMENTS JOURNAL OF For CRJ ______

SUNDRY ACCOUNTS
DOC DATE DETAILS OF BANK EQUIPMENT FUEL DRAWINGS
PAYEE AMOUNT DETAILS

77
EXERCISE 30 Date: ___________

W. Gietl is the owner of "Live Concerts" and is a Disc Jockey (DJ). He plays music for
all occasions.
According to his receipt book and cheque counterfoils, these are the
transactions that took place for the month of September 20_____

Record the transactions into the CRJ and CPJ

01 Issued receipt number 23 to R. Rich to play at her wedding, R 4 500

Paid R 400 to Music Mate for smoke liquid (Material costs) cheque counterfoil number 118
02 Issued receipt to SS Functions R 3 500
Wrote out a cheque to Copy Centre for business cards, R 250
03 Cashed a cheque for wages, R 350
05 Received R 2000 from J. Jones for playing at his 21st and a
deposit was received from R. Reece for R 3500
06 P. Porter accepted a quote for R 3 700 and paid a 50% deposit
SS Functions made another payment of R 3 500
07 P. Porter paid the balance owing
08 Issued a receipt to F. Fraser for R 2 300
09 R. Rick hired lighting from Live Concerts, issued receipt for R 550
11 Cashed a cheque for fuel, R 700
12 Paid for a microphone by cheque. Issued to Music Mate for R 1 575
17 Cheque number 123 issued to Cardies for a client gift (Marketing),R 297, 50

Analyse the transactions of the CRJ and

show their effect on the Accounting Equation. ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

01

02

05

05

09

78
EXERCISE 30 Date: ___________

FOR CRJ ____

ANALYSIS CURRENT SUNDRY ACCOUNTS

DOC DATE DETAILS OF BANK INCOME
RECEIPTS AMOUNT DETAILS

CASH PAYMENTS JOURNAL OF For CPJ ____

SUNDRY ACCOUNTS
DOC DATE DETAILS OF BANK EQUIPMENT FUEL MARKETING
PAYEE AMOUNT DETAILS

Analyse the following transactions of the

CPJ to show their effect on the
Accounting Equation ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

01

02

03

11

12

17

79
 POST TRANSACTIONS TO THE PCJ

POST TOTALS AND SUNDRY

TRANSACTIONS FROM THE PCJ
TO THE GENERAL LEDGER

POSTING RULES
DR CR

80
SOURCE DOCUMENTS (Step 2)
SH
CA X
BO
3. PETTY CASH

In a business, most ordinary payments are made by cheque. However, some small
payments have to be made from time to time for stationary, postage etc. These are
T
Petty (small) expenses. A petty cash box is kept in the business with an initial amount
of money called the T imprest amount. This cash on hand is an asset. As the business
makes payments for small expenses, a T petty cash voucher is completed for each
transaction. The vouchers are in chronological (number) order. The vouchers are then
placed back in the box. The person responsible for the petty cash box (Petty Cashier)
records the transactions from the petty cash vouchers in the T Petty Cash Journal (PCJ)
daily. The vouchers are then filed chronologically. Before all the petty cash is spent, the
imprest amount needs to be T restored. A cheque is cashed for the total amount spent
and the money is put back in the petty cash box.

Eg. R200,00 Imprest amount

-R145,00 Total petty cash vouchers

R55,00 Total left in petty cash box.

A cheque is cashed for R145,00 to draw money from the business bank account
(current asset) to restore the petty cash (current asset) to R200.00.

The imprest amount can also be increased or decreased.

PETTY CASH VOUCHER

DATE A NO: B

FOR AMOUNT

C
D

PETTY CASHIER E

AUTHORISED BY: F

A. Date of the petty cash payment

B. Petty cash voucher number (Chronological order)

C. Expense details.

D. Amount in Rands and Cents.

E. Signature of petty cashier.

F. Aurthorisation, (signature of approval) by supervisor or owner. The petty cashier

may even have authority to approve the payment.

81
DATE: 01/07/05
C DATE: 01/07/05
TO: CASH A D DIZZY BANK
FOR: PETTY CASH B
BALANCE: 13 729.67
PAY CASH A OR BEARER
-
DEPOSIT:
THE SUM OF ONE HUNDRED AND FORTY FIVE RAND ONLY
THIS CHEQUE:

R 145.00 R 145.00
BALANCE: 13 874.67

002 002 572631052986 PJ WHOLESALERS

An example of a cheque cashed for R145.00 to either establish or restore the imprest
amount.

A. The cheque is made out to cash. (Details)

B. Specify what the payment is for.

C. Cash cheques are not crossed.

This transaction is entered in the Cash Payments Journal as follows.

CASH PAYMENT JOURNAL OF PJ WHOLESALERS FOR JULY 2005 CPJ 07

DOC. DETAILS BANK TRADING SUNDRY ACCOUNTS

NO. DATE WAGES
OF PAYEE INVENTORY AMOUNT DETAILS
002 01 Cash 145.00 145.00 Petty Cash

82
 PETTY CASH JOURNAL PCJ (Step 3)

RECORDING PETTY CASH VOUCHERS IN THE PETTY CASH JOURNAL

Only payments from Petty Cash are entered into the Petty Cash Journal.

PJ Potgieter is the owner of PJ Wholesalers. These are the Petty cash vouchers of PJ
Wholesalers for July 2005. The imprest amount is R300,00.

PETTY CASH VOUCHER PETTY CASH VOUCHER

DATE 5/07/05 NO: 04 DATE 6/07/05 NO: 05

FOR AMOUNT FOR AMOUNT

STATIONERY R30.00 PJ POTGIETER R50.00

PETTY CASHIER P. Rose PETTY CASHIER P. Rose

P. Rose P. Rose
AUTHORISED BY: AUTHORISED BY:

Re-write the transactions in your own words

This is how to record the transactions in the Petty Cash Journal.

PETTY CASH JOURNAL OF PJ WHOLESALERS FOR PCJ ____

DOC. PETTY SUNDRY ACCOUNTS

NO. DATE DETAILS CASH WAGES TELEPHONE STATIONERY AMOUNT DETAILS

04 05 Stationery 30.00 30.00

05 06 PJ Potgieter 50.00 50.00 Drawings

212.00 50.00 49.00 58.00 55.00

83
You are the bookkeeper for PJ Wholesalers. Record the following petty cash transactions
in the PCJ and total the accounts. The Petty cash column must be equal to the sum of the
other columns.

7 Bought new pens. Paid from petty cash R28.

8 Paid a temporary worker from petty cash for washing cars R50,00. (Wages)

9 Paid for stamps from petty cash R5,00. (Postage)

11 Bought phone card from petty cash R49,00. (Telephone)

1. Cash a cheque on the 12th of July to restore the imprest amount.

DATE: DATE:
TO: D DIZZY BANK
FOR:
BALANCE: R 23 298.00
PAY OR BEARER
DEPOSIT:
THIS CHEQUE: THE SUM OF

R R
BALANCE: R
014 014 572631052986 PJ WHOLESALERS

2. Post this transaction to the CPJ

CASH PAYMENT JOURNAL OF PJ WHOLESALERS FOR CPJ

DOC. DATE TRADING SUNDRY ACCOUNTS

DETAILS BANK WAGES
NO. OF PAYEE INVENTORY AMOUNT DETAILS

84
EXERCISE 31 Date: ___________

P. Green, owner of Green Fingers Garden Services made the following payments by cheque.
These are the details as per the Cheque Counterfoils and Petty Cash Vouchers for
September 20__________

Cheque Cheque Counterfoil Details Amount (R’s)

Date number
01 138 Cash – Petty Cash (Establish Imprest amount) 500, 00
08 139 Cash – Petty Cash (Restore Imprest amount) ?
18 140 Cash – Petty Cash (Restore Imprest amount) ?

Date Voucher Petty Cash Voucher Amount (R’s)

number
01 P122 Pens - Stationery 99, 00
03 P123 Stamps for posting - Postage 45, 00
07 P124 Lunch - Drawings 150, 00
11 P125 Repairs 200, 00
13 P126 Fuel 245,00
17 P127 Parking 20, 00
PETTY CASH JOURNAL OF FOR PCJ

DOC. PETTY
NO. DATE DETAILS CASH WAGES REPAIRS POSTAGE AMOUNT DETAILS

CASH PAYMENTS JOURNAL OF FOR CPJ

DETAILS SUNDRY ACCOUNTS
OF TRADING
DOC DATE PAYEE BANK WAGES INVENTORY FUEL AMOUNT DETAILS

Analyse the transactions and show their

effect on the Accounting Equation. ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

08

11

18

85
EXERCISE 32 Date: ___________

C. Fitzgerald owner of "Cards by Claire" made the following payments from Petty

Cash. The imprest amount is R150.00

• Record the transactions in the Petty Cash Journal for September 20_____
• Restore the imprest amount at the end of the month.

1. Paid for repairs to her cutting machine R50.00 Petty cash

voucher 007
2. The owner bought lunch R15.00 (C. Fitzgerald)
3. The owner paid for repairs to her shoes from Petty Cash R12.00
3. Bought stamps R10.00 for the business
5. Paid casual labourer R50 to do stock take.
30. Cashed cheque 718 to restore the imprest amount.

PETTY CASH JOURNAL OF Cards by Claire FOR PCJ

DOC. PETTY SUNDRY ACCOUNTS
NO. DATE DETAILS CASH WAGES REPAIRS POSTAGE AMOUNT DETAILS

137.00 50.00 50.00 10.00 27.00

CASH PAYMENT JOURNAL OF Cards by Claire FOR CPJ

DOC. DATE SALARIES PETTY SUNDRY ACCOUNTS
DETAILS BANK AND FUEL
NO. OF PAYEE CASH AMOUNT DETAILS
WAGES

Analyse the transactions and show their effect on the Accounting Equation.

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

01

02

03

03

05

30

86
EXERCISE 33 Date: ___________

D Carefully of "Safety Driving School" issued the following cheques and petty cash
vouchers for March 20________
Post the transactions to the relevant journals.

Date Cheque Cheque Counterfoil Details Amount (R’s)

number
01 239 Cash – Petty Cash (Establish Imprest amount) 350, 00
06 240 Cash – Petty Cash (Restore Imprest amount) ?
25 241 Cash – Petty Cash (Restore Imprest amount) ?

Date Voucher Petty Cash Voucher Amount (R’s)

number
02 V 32 Wages 100, 00
03 V 33 Puncture Kit (Repairs) 45, 00
04 V 34 Lunch - Drawings 50, 00
05 V 35 Repairs 180, 00
13 V 36 Fuel 120,00
24 V 37 Invoice Book (Stationery) 45, 00

PETTY CASH JOURNAL OF FOR PCJ

DOC. PETTY
NO. DATE DETAILS CASH WAGES REPAIRS FUEL AMOUNT DETAILS

CASH PAYMENTS JOURNAL OF FOR CPJ

DETAILS SUNDRY ACCOUNTS
OF TRADING
DOC DATE PAYEE BANK WAGES INVENTORY FUEL AMOUNT DETAILS

Analyse the transactions and show their

effect on the Accounting Equation. ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

06

13

24

87
EXERCISE 34 Date: ___________
C. Cindy the owner of "Candy Love" has the following Petty Cash Vouchers
in her petty cash box for Mach 20_________
The imprest amount is R450.00

• Record the transaction into the Petty Cash journal

• Restore the imprest amount on the last day of the month (CPJ)

01 Bought a pen and pencils from CNA R50.00 - Petty Cash Voucher number 21
02 Paid for lunch from petty cash R25.00 (C. Cindy)
03 Gave a donation to Life Line from petty cash R50
04 Put fuel in her car and paid R100 from petty cash. (She uses her vehicle to
make deliveries)
05 Paid wages for the day from petty cash R150
27 Paid for stamps from petty cash R40.00
31 Cashed cheque number 428 to restore the imprest amount

PETTY CASH JOURNAL OF For PCJ

DOC. PETTY
NO. DATE DETAILS CASH WAGES DRAWINGS STATIONERY AMOUNT DETAILS

CASH PAYMENTS JOURNAL OF For CPJ

DOC. DATE TRADING SUNDRY ACCOUNTS
DETAILS BANK WAGES INVENTORY FUEL
NO. OF PAYEE AMOUNT DETAILS

What effect does the transaction on the 31st have on the Accounting Equation?

ACCOUNTING EQUATION

SOURCE DOCUMENT A = O/E + L

31

88
EXERCISE 35 Date: ___________
SA Florists recorded the following petty cash transactions for April 20________. The Imprest amount is R 500.00.

! Enter the transactions in the relevant journals of SA Florists. Total the accounts of the PCJ.

01 Paid R 35.00 for florist tape from petty cash, voucher number 89.
03 Paid casual labourer R 50.00 from petty cash.
04 The owner (Mrs. Henley) took R 15.00 to buy her grandson an ice-cream.
05 R 50.00 was paid from petty cash for petrol for deliveries.
06 A donation of R 20.00 was made to the Salvation Army from petty cash.
07 Bought order books and staples from PNA for R 45.00 and paid from petty cash.
08 Paid R 4.00 from petty cash for stamps.
14 The owners paid her grandson R 20.00 for sweeping the shop.
17 The following was paid from petty cash: pens R 23.00; stamps R 12.00.
23 Issued cheque number 075 to restore the imprest amount.
24 Made another donation of R 30.00 from petty cash.
26 Paid R 40.00 from petty cash to a casual labourer for washing the company van.
27 Paid R 100.00 from petty cash for repairs made to shelving.
30 Issued cheque number 082 to restore the imprest amount.

PETTY CASH JOURNAL OF FOR PCJ

DOC. PETTY SUNDRY ACCOUNTS

NO. DATE DETAILS CASH WAGES DONATIONS STATIONERY AMOUNT DETAILS

CASH PAYMENTS JOURNAL OF FOR CPJ

DETAILS SUNDRY ACCOUNTS
OF TRADING
DOC DATE PAYEE BANK WAGES INVENTORY FUEL AMOUNT DETAILS

89
NAME: __________________ GRADE: _______
EXERCISE 36 (FULL SET OF JOURNALS) TEAR OUT PAGE Date: ___________
These are the duplicate receipts of Fasteners Unlimited for March 2005 (They are not in date
order). R. Keith has calculated a 165% mark up on his cost price.
! Analyse the source documents and enter the transactions into the CRJ of Fasteners Unlimited.
Received from: Ideal Bolt Received from: Impala Received from: Global Bolt
Date: 03/03/05 Bolt Date: 08/03/05 Date: 15/03/05
Sum of: R 1 500.00 Sum of: R 2 500.00 Sum of: R 1 000.00
in payment of Bolts & Nuts in payment of Bolts, nuts in payment of Bolts and nuts
and rivets
for: Fasteners Unlimited for: Fasteners Unlimited for: Fasteners Unlimited
Seass Seass Seass
29 Signature 31 Signature 32 Signature

Received from: Germiston Received from: R. Keith Received from: Bolt Tech
Bolt Date: 25/03/05 Date: 26/03/ 05 Date: 29/03/05
Sum of: R 8 279.00 Sum of: R 50 000.00 in Sum of: R 14 000.00
in payment of Bolts payment of Capital in payment of Bolts, nuts
contribution and rivets
for: Fasteners Unlimited for: Fasteners Unlimited for: Fasteners Unlimited
Seass Seass Seass
35 Signature 36 Signature 39 Signature

Received from: Germiston Bolt Received from: Ideal Bolt Received from: Ideal Bolt
Date: 25/03/05 Date: 26/03/05 Date: 29/03/05
Sum of: R 3 721.00 Sum of: R 23 000.00 Sum of: R 5 000.00
in payment of Nuts in payment of Bolts & nuts in payment of Bolts & nuts

for: Fasteners Unlimited for: Fasteners Unlimited for: Fasteners Unlimited

Seass Seass Seass
34 Signature 37 Signature 40 Signature

Received from: Impala Received from: National Received from: Global

Bolt Date: 15/03/05 Bolt Date: 26/03/05 Bolt Date: 03/03/05
Sum of: R 2 500.00 Sum of: R 27 000.00 Sum of: R 3 500.00
in payment of Bolts & rivets in payment of Bolts & rivets in payment of Bolts & nuts

for: Fasteners Unlimited for: Fasteners Unlimited for: Fasteners Unlimited

Seass Seass Seass
33 Signature 38 Signature 30 Signature

CASH RECEIPTS JOURNAL OF FOR CRJ

ANALYSIS COST SUNDRY ACCOUNTS
OF OF
DOC DATE DETAILS RECEIPTS BANK SALES SALES AMOUNT DETAILS

PASTE TEAR OUT, JOURNAL PAGES BACK INTO YOUR BOOK

90
NAME: __________________ GRADE: _______
Date: ___________
EXERCISE 36 (REVISION) TEAR OUT PAGE
R. Keith owns Fasteners Unlimited. He manufactures and sells bolts and nuts. According
to the cheque counterfoils, these were the payments for March 2005
! Balance the cheque book after each payment. (Optional Activity)
! Enter the transactions into the Cash Payments Journal of Fasteners Unlimited.

Date:01/03/05 Date:02/0305/ Date:03/0305/ Date:03/03/05

To: Tshwane Mun. To: SA Steel To: Cash To: Cash

For: Water & Elect. For: Raw steel For: Petty Cash For: Wages

Balance: R192 576.00 Balance: R192 016.00 Balance: Balance:

Deposit: Deposit: Deposit: R5 000.00 Deposit:
This cheque: R560.00 This cheque:R13 000.00 This cheque:R100.00 This cheque:R 1000.00
Balance R192 016.00 Balance Balance Balance
041 042 043 044

Date:05/03/05 Date:08/03/05 Date:11/03/05 Date:12/03/05

To: Telkom To: Racer Motors To: R. Keith To: SA Steel

For: Telephone For: Trailer For: Drawings For: Raw steel

Balance: Balance: Balance: Balance:

Deposit: Deposit: R2 500.00 Deposit: Deposit:
This cheque: R351.00 This cheque:R13 000.00 This cheque:R500.00 This cheque:R12 000.00
Balance Balance Balance Balance
045 046 047 048

Date:13/03/05 Date:14/03/05 Date:15/03/05 Date:18/03/05

To: Pro-ma cc To: ST Packaging To: Cash To: Rennies

For: Machinery For: Crates For: Wages For: Rent

Balance: Balance: Balance: Balance:

Deposit: Deposit: Deposit: R3 500.00 Deposit:
This cheque: R9000.00 This cheque:R927.00 This cheque:R1000.00 This cheque:R2 500.00
Balance Balance Balance Balance
049 050 051 052

Date: 23/03/05 Date: 25/03/05 Date: 26/03/05 Date: 29/03/05

To: Cash To: Cash To: R. Keith To: Cash

For: Petty Cash For: Fuel For: Drawings For: Wages

Balance: Balance: Balance: Balance:

Deposit: Deposit: R12 000.00 Deposit: R100 000.00 Deposit: R19 000.00
This cheque: R100.00 This cheque:R300.00 This cheque:R500.00 This cheque:R1 000.00
Balance Balance Balance Balance
053 054 055 056
PASTE TEAR OUT, JOURNAL PAGES BACK INTO YOUR BOOK

91
EXERCISE 36
CASH PAYMENTS JOURNAL OF FOR CPJ
SUNDRY ACCOUNTS
DETAILS MATERIAL DRAW-
DOC DATE OF PAYEE BANK WAGES COSTS INGS AMOUNT DETAILS

92
NAME: __________________ GRADE: _______
EXERCISE 36TEAR OUT PAGE Date: _____________
R. Keith of Fasteners Unlimited made the following payments from petty cash during
March 2005 (The petty cash box was only established on the 1st of March 2005.) The
imprest amount was R 450.00.

! Analyse the following petty cash vouchers and enter the transactions in the Petty
Cash Journal of Fasteners Unlimited.

! Restore the imprest amount on th 20th and again on the 26th.

! Use the cheque counterfoils to show the cheque payments.
! Record these payments in the CPJ.
! Analyse the transactions and show their overall effect on the Accounting
Equation
PETTY CASH VOUCHER PETTY CASH VOUCHER PETTY CASH VOUCHER
DATE 02/03/05 NO: 024 DATE 03/03/05 NO: 025 DATE 07/03/05 NO: 026
FOR AMOUNT FOR AMOUNT FOR AMOUNT

Pens and R 20.00 R. Keith R 100.00 Kids Haven R 50.00

Envelopes (Children’s
Home)
PETTY CASHIER Kerry PETTY CASHIER Kerry PETTY CASHIER Kerry
AUTHORISED BY: K. Rose AUTHORISED BY: K. Rose AUTHORISED BY: K. Rose

PETTY CASH VOUCHER PETTY CASH VOUCHER PETTY CASH VOUCHER

DATE 08/03/05 NO: 027 DATE 08/03/05 NO: 028 DATE 13/03/05 NO: 029
FOR AMOUNT FOR AMOUNT FOR AMOUNT

Fuel R 30.00 Wages R 75.00 Stamps R 5.00

PETTY CASHIER Kerry PETTY CASHIER Kerry PETTY CASHIER Kerry

AUTHORISED BY: K. Rose AUTHORISED BY: K. Rose AUTHORISED BY: K. Rose

PETTY CASH VOUCHER PETTY CASH VOUCHER PETTY CASH VOUCHER

DATE 17/03/05 NO: 030 DATE 21/03/05 NO: 031 DATE 22/03/05 NO: 032
FOR AMOUNT FOR AMOUNT FOR AMOUNT

R. Keith R 60.00 Auto repairs R 60.00 Stationery R 12.00

PETTY CASHIER Kerry PETTY CASHIER Kerry PETTY CASHIER Kerry

AUTHORISED BY: K. Rose AUTHORISED BY: K. Rose AUTHORISED BY: K. Rose

PETTY CASH VOUCHER PETTY CASH VOUCHER PETTY CASH VOUCHER

DATE 23/03/05 NO: 033 DATE 25/03/05 NO: 034 DATE 25/03/05 NO: 035
FOR AMOUNT FOR AMOUNT FOR AMOUNT

Oil for bakkie R 25.00 Car wash R 40.00 Licence for R 215.00
(casual) bakkie

PETTY CASHIER Kerry PETTY CASHIER Kerry PETTY CASHIER Kerry

AUTHORISED BY: K. Rose AUTHORISED BY: K. Rose AUTHORISED BY: K. Rose

PETTY CASH VOUCHER PETTY CASH VOUCHER Date: 20/03/05 Date: 26/03/05
28/03/05 036 29/03/05 037
CHEQUE COUNTERFOIL

CHEQUE COUNTERFOIL

DATE NO: DATE NO:

To: Cash To: Cash
FOR AMOUNT FOR AMOUNT

R. Keith R 100.00 Phone card R 50.00 For: Petty cash For: Petty cash

Amount: Amount:
PETTY CASHIER Kerry PETTY CASHIER Kerry R 340.00 R 352.00
AUTHORISED BY: K. Rose AUTHORISED BY: K. Rose 0144 0150

PASTE TEAR OUT, JOURNAL PAGES BACK INTO YOUR BOOK

93
EXERCISE 36

PETTY CASH JOURNAL OF FOR PCJ 03

DOC. PETTY SUNDRY ACCOUNTS

NO. DATE DETAILS CASH WAGES DRAWINGS STATIONERY AMOUNT DETAILS

CASH PAYMENTS JOURNAL OF FOR CPJ

SUNDRY ACCOUNTS
DETAILS TRADING
DOC DATE OF PAYEE BANK WAGES INVENTORY FUEL AMOUNT DETAILS

PASTE TEAR OUT, JOURNAL PAGES BACK INTO YOUR BOOK

94
NAME: __________________ GRADE: _______
Date: ___________
EXERCISE 37 (FULL SET OF JOURNALS) TEAR OUT PAGE
TRANSACTIONS OF HAIRLOVERS HAIR SALON

Hair Lovers is a hair salon and is owned by Mrs Cherry.

April 20________
1. The owner contributed R70 000.00 to start the business (Issued receipt no 27)

2. Bought new vehicle from Auto Art for R5 000.00. Paid by cheque (Cheque no 721)

3. Cashed Cheque to establish Petty cash R150.00.

4. Cashed cheque to pay wages, R 300.00.

5. Paid for stationery from Petty cash R15.00 (Petty cash voucher no 2)

6. The owner took R50.00 for lunch from petty cash.

7. Services rendered as per CRR for the day

R700.00.

8. Received R3 000.00 rent from P. Pieters for shop

space. Issued receipt.

9. Paid R600.00 by cheque for shampoo &

conditioner to Hair Care.

10. Paid Ekurhuleni Municipality for utility bill R347.00

by cheque.

11. Bought new hairdryers from Hair Care. Paid by

cheque R 700.00.

12. Paid for stamps from Petty cash R12.00.

13. Restored imprest amount of petty cash.

PASTE TEAR OUT, JOURNAL PAGES BACK INTO YOUR BOOK

DATE SOURCE DOCUMENT DOC NO JOURNAL

95
EXERCISE 37
Date:
! Enter the transactions in the appropriate Journals and Cast (total) the accounts
CASH RECEIPTS JOURNAL OF FOR ____________ CRJ

Analysis Current Sundry Account

Doc Date Details Bank
of receipt income Amount Details

CASH PAYMENTS JOURNAL OF FOR CPJ

Material Sundry Account
Doc Date Details of Payee Bank Wages costs Amount Details

PETTY CASH JOURNAL OF FOR PCJ

Petty Sundry Account

Doc Date Details Cash Postage Stationery Details
Amount

PASTE TEAR OUT, JOURNAL PAGES BACK INTO YOUR BOOK

96
Use the space provided to calculate the Cost of Sales for each sale.

FORMULA FOR COST OF SALES

97
 NAME: ACTUAL
TOTAL: 122
GRADE: %
DATE: DUE DATE:
LEVEL
EXERCISE 38
TRANSACTIONS OF TEMPTING TRADERS

Mr Sweet owns Tempting Traders. He buys and SP 100

CP = x
sells sweets. 1 (100 + % m.u.)
His profit mark up is 25%.

These are the transactions for the month of March 2005

1. Owner increased his capital by R35 000.00. Issued receipt no. 57.

2. Paid The Star by cheque for advertising R375.17 (cheque no 92)

3. Bought stock from Yummy Manufacturers for R5 000.00 - paid by

cheque.

4. Repair packing machine, cashed cheque R275.00

5. Paid Telkom for telephone by cheque R700.00

6. Issued receipt to W. Wills for stock sold R3721.19

7. Sales as per CRR R3 200.00.

8. Issued receipt to P. Pieters for storage space rent to him R3 000.00.

9. Cashed cheque for R3 000.00. Wages R2 500.00 and R500.00 of this the owner
used pay for his child’s school fees.

10. Bought packets from Lacey & Co and paid by cheque R70.30.

11. Paid for stamps from Petty Cash R50.00 voucher no 26.

12. Cashed cheque for R250.00 to restore the imprest amount.

13. Bought trading stock from Yummy Manufacturers R5 577.00 and paid by cheque.

14. Paid R12.00 for Stationery and R35.00 for Wages from Petty Cash.
(Separate vouchers).

Petty Cash Vouchers

29 30 31
Date: 15/03/05 Date: 22/03/05 Date: 29/03/05

FOR AMOUNT FOR AMOUNT FOR AMOUNT

Mr. Sweet R50.00 Stationery R15.00 Stamps R20.00

Petty Cashier: Lubbe Petty Cashier: Lubbe Petty Cashier: Lubbe

Authorised: vd Rose Authorised: vd Rose Authorised: vd Rose

98
EXERCISE 38

Duplicate PS! Remember the 25% m.u. when

RECEIPTS calculating cost of sales and trading inventory.

Received from: W.Willis Received from: Mr. Sweet Received from: R. Riles

Date: 15/03/05 Date: 17/03/05 Date: 19/03/05

sum of R 372.25 sum of R 5 000.00 sum of R 5 725.00

in payment of Suckers in payment of Capital in payment of Fudge

(50 packets) (50 packets) (250 packets)
Tempting Tempting Tempting
60 for Traders vd Rose 61 for Traders vd Rose 62 for Traders vd Rose
SIGNATURE SIGNATURE SIGNATURE

Received from: R. Jules Received from: P. Rolen Received from: P. Pieterse

Date: 21/03/05 Date: 22/03/05 Date: 31/03/05

sum of R 5 600.00 sum of R 7 000.00 sum of R 3 000.00

in payment of Sweets in payment of Sweets in payment of Rent

(50 packets) (150 packets)
Tempting Tempting Tempting
63 for Traders vd Rose 64 for Traders vd Rose 65 for Traders vd Rose
SIGNATURE SIGNATURE SIGNATURE

Sales according to CRR

15/03 17/03 22/03 26/03 31/03

Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop

Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop

Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop

Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop

Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop

Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop Ek het baie ding hiermee verkoop

R 532.00 R 721.00 R 927.15 R 52.19 R 69.20

Cheque Counterfoils

Date: 16/03/05 Date: 16/03/05 Date: 18/03/05 Date: 18/03/05

To: Ekurhuleni To: Lacey & Co. To: Cash To: B.J. Auto
Municipality

For: Utilities For: Ribbon For: Wages For: Bakkie

Amount R 350.71 Amount R 127.52 Amount R 3 250.00 Amount R 12 000.00

100 101 102 103

99
EXERCISE 38 continued
Date:

! Analyse the transactions of Tempting Traders under the given headings

Analysis of transactions

Date Source Document Doc. No. Journal

10

11

12

13

14

14

100
EXERCISE 38 continued TEAR OUT PAGE Date:

Analysis of transactions

Date Source Document Doc. No. Journal

15

15

15

16

16

17

17

18

18

19

21

22

22

22

26

29

31

31

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101
EXERCISE 38 continued
Date:

! Enter the transactions in the appropriate Journals.

CASH RECEIPTS JOURNAL OF FOR ______________CRJ

Analysis Cost of Sundry Account

Doc Date Details Bank Sales
of receipt Sales Amount Details

PASTE TEAR OUT, JOURNAL PAGES BACK INTO YOUR BOOK

102
NAME: __________________ GRADE: _______

EXERCISE 38 continued TEAR OUT PAGE Date: ___________

CASH PAYMENTS JOURNAL OF FOR CPJ

Trading Sundry Account
Doc Date Details of Payee Bank Wages Inventory Amount Details

PETTY CASH JOURNAL OF FOR PCJ

Petty Sundry Account

Doc Date Details Cash Wages Postage Stationery
Amount Details

PASTE TEAR OUT, JOURNAL PAGES BACK INTO YOUR BOOK

103
 ELECTRONIC TRANSFER (EFT) – Cash Payments are made directly
from one bank account to another bank account.

The Source Document for EFT payments/receipts will be the Bank Statement.
Record the Document number as B/S.

Do not record the money into the Analysis column because the money is
already in the bank.

EXERCISE 39 REVISION CRJ, CPJ, PCJ Date: ___________

December 20__ Do your workings in pencil first)

Receipts issued for services rendered

5 Receipt no 675 to Tentco, R 900.00

6 Big Blue, R 750.00

According to their bank statement, Aramex Couriers received EFT Payments from the
following customers for services rendered

13 Jumbo CC R 90 000.00
25 Litho (PTY Ltd) R 85 500.00
27 Shamrock R 73 000.00
29 Lewis (Ltd) R 97 000.00

EFT payments
2 Caltex for Fuel, R 45 000.00

2 Auto Inc. for repairs to vehicles, R 53 000.00

4 Ekurhuleni Municipality for Rates and Water Account, R 13 000.00
5 Telkom R 12 234.00
30 Salaries: J. Wilson, R 7 500.00

B. Beneke, R 7 500. 00
H. Makena R 12 000. 00
Cheque counterfoils
10 Cheque no 435 issued to Caltex for Fuel R 20 000.00
11 R 3 500 to Caxton for advertising.
12 R 5 000.00 to CMS for security
15 R 2 000.00 to restore the imprest amount to Petty Cash
22 R 7 200.00 to LIT Creations for Web Updates (Advertising)
28 R 8 000.00 Caltex for Fuel

Petty Cash Vouchers:

16 Voucher no 22, R 212.00 for files

18 R 230.00 Stationery
19 R 150 Carwash by casual labourer (Wages)
29 R 210 Owner (M. Kalib)

104
NAME: __________________ GRADE: _______
EXERCISE 39 TEAR OUT PAGE

CASH RECEIPTS JOURNAL OF ____________________ CRJ ___

Analysis Sundry Accounts

Doc Date Details of Bank Current Details
Receipts Income Amount

CASH PAYMENTS JOURNAL OF ____________________ CRJ___

Doc Date Details of Payee Bank Salaries Fuel Sundry Account

Amount Details

PETTY CASH JOURNAL OF ____________________________ PCJ __

Doc Date Details Petty Stationery Wages Sundry Account

Cash Amount Details

PASTE TEAR OUT, JOURNAL PAGES BACK INTO YOUR BOOK

105
 Date: ___________

EXERCISE 40 REVISION – CRJ, CPJ, PCJ

December 20_____ (Do your workings in pencil first)

According to their Bank Statement, Wamark Publishers

received EFT Payments from the following High Schools/ College
for EMS/Accounting workbooks - 50% mark-up)

Date School/ College Amount Cost Price

21 Sir Pierre R 60 000
23 Hansmoore R 85 500
26 Durban North R 23 000
28 Alberton R 97 000
28 Allen Glen R 22 000
28 Brits R 15 000
29 Springs Girls R 54 000
29 Bryanston R 74 000
30 Crawford R 32 000
31 Dinamika R 35 500
Receipts issued for EMS/ Accounting workbooks to the following Schools/
Colleges/Bookshops

Date Receipt No School/ College Amount Cost Price

11 041 Fochville R 23 000
14 Hartbeespoort R 92 000
14 Mandini Academy R 25 000
15 Maris Stella R 12 000
16 Parktown Girls R 20 000
26 Parktown Boys R 70 000
27 Sunward Park R 23 000
27 Dinwiddie R 54 000
28 Greenside R 25 000
28 Star College R 12 000
29 St Benedicts R 25 000
31 St Dunstans R 23 000
31 Victory House R 22 000
31 St Cyprians R 12 000
31 Roedean R 43 000
31 Helpmekaar R 56 000
31 PNA (For R 19 000
Edenvale)
31 Pinnacle (For R 12 000
Sacred Heart)
31 St Catherines R 15 000
Convent
31 Grantley R 10 000

106
EXERCISE 40

The EMS Specialists

CASH RECEIPTS JOURNAL OF _____________________ CRJ ____

Analysis Sundry Accounts

Doc Date Details of Bank Sales Cost of
Receipts Sales Amount Details

107
EXERCISE 40

According to their Bank Statement, Wamark made the following

EFT payments

2 Microsoft for Computer Programme R 10 000.00 (Equipment)

3 MY Office Supplies for Desks and Chairs R 25 000. 00
5 LIT Creations for Web Design (Advertising) R 5 000.00
6 Aramex Couriers R 125 000.00
6 Telfree for multi messaging system (Advertising) R 5 000.00
7 Kaponong Hotel Venue Hire for Training (Marketing) R 22 000.00
8 Waltons for CD’s and Covers for educator guides (Material Costs) R 1000.00
10 Sanral (eToll) R 450.00
12 Game Vouchers for Schools – Giving Back (Marketing) R 50 000.00

Cheque counterfoils

1 Cheque no 471, Baxter and Co eBook Developers R 16 000.00 (eBook)

2 Microsoft for Computer R 15 000.00
3 AA Printers R 350 000.00 (Printing)
4 Mandy Wilson for Editing R 20 000.00 (Editing)
4 Claire Fitzgerald for Translating the workbooks R 10 000.00
(Translating)
7 Show Time Advertising for promotional Mugs R 4 000.00
8 Box It for boxes, tape and bubble R 3 000.00
10 AA Printers for Pamphlets for marketing purposes R 15 000.00
12 R Reece for Typesetting the workbooks for 2015 R 50 000.00
(Typesetting)
13 SAA for Flights (Travel) to see schools in Cape Town R 4 500.00
13 Blue Peter for Hotel Accommodation R 4 500.00 (Travel)
14 Cash Cheque to restore Imprest amount R 3000.00
26 Y.T Gietl (Author) Royalties R 120 000.00

Petty Cash Vouchers

3 Voucher no: 021 Ink for office printer R 980. 00
3 Ream of paper for the office copier R 320.00
4 Files R 450.00
5 Pens R 90.00
6 Fuel R 700.00
9 Sweets R 300.00(Marketing)

108
EXERCISE 40

CASH PAYMENTS JOURNAL OF ____________________ CRJ ____

Sundry Account
Doc Date Details of Payee Bank Advertising Marketing Amount Details

PETTY CASH JOURNAL OF ________________________________ PCJ _____

Doc Date Details Petty Stationery Wages Sundry Account

Cash Amount Details

109
 NOTES: Date: ___________

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110
 THE ACCOUNTING PROCESS / CYCLE

1. TRANSACTIONS

CASH (Grade 8) CREDIT (Grade 9)

After a transaction has taken place

a source document is issued. You will analyse
completing the relevant source documents
before you complete the journals.

2. CASH TRANSACTIONS - Source documents CREDIT TRANSACTIONS - Source documents

Duplicate Cash Register Roll (CRR) Original

ate
Duplic

Duplicate Invoice
Duplicate Receipt (Original issued to Debtors)

Cheque Counterfoil Original Invoices (Received from Creditors)

Petty Cash Voucher

Journals: The CRJ, CPJ and PCJ are used to

record cash transactions that have taken place in the
business. We are first going to complete each
cash journal before posting them to the
General Ledger.

3. CASH JOURNALS (Daily) CRJ CREDIT JOURNALS (Daily) DJ

CPJ CJ
PCJ

CASH RECEIPTS JOURNAL - CRJ DEBTORS JOURNAL - DJ

CASH PAYMENTS JOURNAL - CPJ CREDITORS JOURNAL - CJ

PETTY CASH JOURNAL - PCJ

POST ALL JOURNALS TO THE GENERAL LEDGER POST ALL JOURNALS TO THE SUBSIDIARY LEDGERS

The T General Ledger is the book where the ledger accounts

are opened. The transactions that take place in the business
are recorded in the accounts that are affected. Recording
entries in the General Ledger is called T posting.
The General Ledger has two sections: SUBSIDIARY LEDGERS (Post daily from the Journals)
1. BALANCE SHEET SECTION
2. NOMINAL SECTION
4.1 DEBTORS LEDGER
4. GENERAL LEDGER (Posting daily and monthly)
DETAILS DEBIT CREDIT BALANCE

DR CR
Ÿ Does not get posted to the Trial Balance
Ÿ Used to draw up the Debtors' Statements

Double entry rule 4.2 CREDITORS LEDGER

DETAILS DEBIT CREDIT BALANCE

5. TRIAL BALANCE (Drawn up monthly)

Ÿ Does not get posted to the Trial Balance
Used to reconcile Creditors' Statements
DEBITS = CREDITS Ÿ

6. FINANCIAL STATEMENTS (Drawn up annually)

6.1 INCOME STATEMENT 6.2 BALANCE SHEET A O+L

PROFIT/LOSS ASSETS = OWNERS EQUITY + LIABILITIES

111
112
The General Ledger has two sections: 1. Balance Sheet Section and 2. Nominal Section

1. The T BALANCE SHEET SECTION will include the Owner’s Equity accounts
(Capital & Drawings), the Asset accounts and Liabilities.
BALANCE SHEET SECTION
Owners Equity Assets Liabilities
Non - current liabilities
Capital Non Current Assets (Long term Liabilities)
Drawings Land and buildings Long term loans
Vehicles Mortgage bond etc.
Equipment etc.
Fixed Deposit Current liabilities
Current Assets (Short term liabilities)
Trading Inventory Creditors Control
Debtors Short term loans etc.
Bank
Cash float
Petty cash

The Balance sheet accounts will be opened as they are required and numbered with a
sequential B - folio reference
BALANCE SHEET SECTION
Eg.
Capital - B1
Drawings - B2
Bank - B3
Vehicles - B4

Debtors Control - B6 }
Creditors Control - B5 Grade 9

Trading Inventory - B7
Petty Cash - B8
2. The T NOMINAL SECTION will include all the income and expense accounts.

NOMINAL SECTION

Income Expenses

Sales Material costs

Current income Stationery
Rent Income Licence fees
Electricity
Advertising
Insurance
Salaries
Repairs etc.

The nominal accounts will be opened as they are needed and will be numbered with a
sequential N - folio reference
NOMINAL SECTION
E.g.
Sales - N1
Material costs - N2
Stationery - N3
Repairs - N4
The accounts can be opened in any order.

113
 THE GENERAL LEDGER (Step 4)

Do not confuse posting transactions to the General Ledger with the effect
transactions have on the Accounting Equation.

With the Accounting Equation we are analysing the overall effect that each transaction
has on Assets, Owner's Equity and Liabilities.

With the General Ledger we are recording each transaction into the accounts affected.

Example:

Transaction: - Paid for stationery and paid by cheque R200 A O+L

1. Effect on A=O/E +L

Bank is an Asset which decreases, stationery is an expense which decreases Owner’s

Equity.

A = O/E + L

-200 = -200 + 0

2. THE GENERAL LEDGER

The two accounts affected are Bank and Stationery. Now this is where you must focus!

Bank decreases BUT the Stationery account increases. This is because ...

1. Debit one account and Credit the other (contra account) account.
2. The expense account (stationery) is increasing and the asset (bank account)
is decreasing.

DR BANK (ASSET) CR
Decreases 200

Bank is an Asset and decreases on the right hand side or Credit side.

DR STATIONERY (EXPENSE) CR
Increases 200

Stationery is an expense and increases on the left hand side or Debit side

114
 THE GENERAL LEDGER
THE DOUBLE ENTRY RULE
Posting transactions to the General Ledger
The General Ledger is divided into two sides. There is a left hand side (LHS) and right
hand side (RHS) The General Ledger looks like a “T”. The left hand side is always
DEBIT T (DR) and the right hand side is always CREDIT T (CR) . Each transaction will
affect two accounts. One account will be debited and the other account (Contra account)
will be credited with the same amount. Therefore for every debit there must be a credit.
This is called the T double entry rule. The contra account must be detailed.

115
 GENERAL LEDGER
ACCOUNTS
A L I E
+ - - + - + + -

Posting transactions to the General Ledger

1. Capital contribution R50 000.00
DR Capital (O/E) CR Capital
Bank 50 000.00 Owners Equity Account
Increase RHS

DR Bank (A) CR Bank

Asset
Capital 50 000.00
Increases LHS

2. Owner drew R800 for personal use

DR Drawings (O/E) CR Drawings

Owner's Equity Account
Bank 800.00 Increases LHS

DR Bank (A) CR Bank

Asset
Drawings 800.00 Decreases RHS

3. Bought a vehicle R35 000

Bank
DR Bank (A) CR Asset
Decreases RHS
Vehicle 35 000.00

Vehicle
DR Vehicle (A) CR Asset
Increases LHS
Bank 35 000.00

4.1 Services rendered R500,00

Bank
DR Bank (A) CR Asset
Current income 500.00 Increases LHS side

DR Current Income (I) CR Current income

Income
Bank 500.00 Increases of RHS side

116
4.2 Cash Sales R750.00 receipt issued. 25% m.u.

DR Bank (A) CR Bank

Asset
Sales 750.00 Increase LHS

DR Sales (I) CR Sales

Income
Bank 750.00 Increase RHS

DR Trading Inventory (A) CR Trading inventory

Asset
Cost of Sales 600.00 Decreases RHS

DR Cost of Sales (E) CR Cost of Sales

Expense
Trading Increase LHS
Inventory 600.00

5.1 Paid for stationery R350

DR Bank (A) CR Bank

Asset
Stationery 350.00 Decreases RHS

DR Stationery (E) CR
Stationery
Bank 350.00 Expense
Increases LHS

5.2 Paid for Fuel R150.00

DR Bank (A) CR
Bank
Fuel 150.00 Asset
Decreases RHS

DR Fuel (E) CR
Fuel
Bank 150.00
Expense
Increases LHS

117
EXERCISE 41 Date: ___________
GENERAL LEDGER
1. Complete the T Accounts for ACCOUNTS
Exercises 41 - 50
A L I E
2. Complete the transaction + - - + - + + -
Analysis for each i.e. Exercises
41.1 - 50.1 (These are tear
1. DR Capital (O/E) CR
out pages)
Bank 50 000.00
Example
DR Bank (A) CR
1. Capital Contribution R50 000.00
Capital 50 000.00

2. Paid for stationery R300 2. DR CR

by cheque

DR CR

3. Paid for fuel R500.00 by cheque 3. DR CR

DR CR

4. Services rendered. 4. DR CR
Banked R2300.00

DR CR

5. Sales as per cash register roll 5. DR CR

R5200.00 - 23% m.u.

DR CR

DR CR

DR CR

118
 EXERCISE 41.1 and 42.1 NAME: ___________________________ GRADE: ________________ DATE:_____________
TRANSACTION ANALYSIS
GENERAL LEDGER ACCOUNTING EQUATION
Source
Date Journal Account DR Account CR A 0/E L
Document
Ex 41.1
01

02

03

04

Bank Sales + 5200 + 5200

119
05 ____________________________________________________________
Cost of Sales Trading Inventory - 4227.64 - 4227.64
Ex 42.1
01

02

03

04

05

06
TEAR OUT PAGE
 EXERCISE 43 .1 and 44.1 NAME: ___________________________ GRADE: ________________ DATE:_____________
TRANSACTION ANALYSIS

GENERAL LEDGER ACCOUNTING EQUATION

Date Source Journal Account DR Account CR A 0/E L
Document
Ex 43.1
01
Bank Sales
02 _____________________________________________________________
Cost of Sales Trading Inventory

03
_____________________________________________________________

120
04

Ex 44.1
01

02

03

04

05 _____________________________________________________________
 GENERAL LEDGER
EXERCISE 42 Date: ___________ ACCOUNTS
A L I E
+ - - + - + + -

1. Capital Contribution R30 000.00 1. DR CR

DR CR

2. The owner drew R20 from 2. DR CR

petty cash for lunch

DR CR

3. Paid R300 for Repairs and 3. DR CR

paid by cheque

DR CR

4. Bought a Vehicle for R20 000 4. DR CR

and paid by cheque

DR CR

5. Made a donation from 5. DR CR

petty cash R20

DR CR

6. Services rendered R2500 6. DR CR

as per CRR

DR CR

121
EXERCISE 43 Date: ____________ GENERAL LEDGER
ACCOUNTS
A L I E
+ - - + - + + -

1. Capital Contribution R90 000.00 1. DR CR

DR CR

2. Issued receipt for sales 2. DR CR

R35 000 250% m.u.
Show calculation
SP 100 DR CR
CP = x
1 100 +%m.u.

DR CR

DR CR

3. Cash sales according to the 3. DR CR

CRR, R32 000.00 250% m.u.
Show calculation

DR CR

DR CR

DR CR

4. Services rendered R25 000 and 4. DR CR

issued receipt.

DR CR

122
 GENERAL LEDGER
EXERCISE 44 Date: ______________
ACCOUNTS
A L I E
+ - - + - + + -

1. Capital Contribution R100 000.00 1. DR CR

DR CR

2. Paid telephone by cheque R350.00 2. DR CR

to Telkom

DR CR

3. Paid Stationery by cheque R3000 3. DR CR

to CNA

DR CR

4. Bought office furniture R50 000 4. DR CR

and paid cheque to Morkels

DR CR

5. Cash Sales R95 000

33½ % m.u. 5. DR CR
Show calculation

DR CR

DR CR

DR CR

123
 Date: ___________ GENERAL LEDGER
EXERCISE 45
ACCOUNTS
A L I E
+ - - + - + + -

1. Increased Capital Contribution 1. DR CR

by R20 000

DR CR

2. Restored imprest amount R900 2. DR CR

DR CR

3. Bought a building and paid cash 3. DR CR

R900 000 to AAA Estate Agents

DR CR

4. Cash Sales R905 000 4. DR CR

220% m.u.
Show calculations

DR CR

DR CR

DR CR

5. Paid Water and Electricity 5. DR CR

R3500.00 paid by cheque

DR CR

124
 EXERCISE 45.1 and 46.1 NAME: ___________________________ GRADE: ________________ DATE:_____________
TRANSACTION ANALYSIS
GENERAL LEDGER
ACCOUNTING EQUATION
Source
Date Document
Journal Account DR Account CR A O/E L
Ex 45.1
01

02

03

04 ___________________________________________________________

125
05

Ex 46.1
01

02

03

04

05

06
TEAR OUT PAGE
 EXERCISE 47.1 and 48.1
NAME: ___________________________ GRADE:
Grade: ________________ DATE:_____________
TRANSACTION ANALYSIS
_______________
GENERAL LEDGER ACCOUNTING EQUATION
Source
Date Document
Journal Account DR Account CR A O/E L
Ex 47.1 _
01

02
___________________________________________________________

03

04

126
05

Ex 48.1
01

02
_
03

04

05 ___________________________________________________________
EXERCISE 46 Date: ___________
GENERAL LEDGER
ACCOUNTS
A L I E
+ - - + - + + -

1. Capital Contribution R90 000 1. DR CR

DR CR

2. Increased Capital contribution 2. DR CR

to R95 000

DR CR

3. Received R50 000 for services 3. DR CR

rendered

DR CR

4. Paid wages by cheque R5000.00 4. DR CR

DR CR

5. Owner drew R500 to play golf 5. DR CR

DR CR

6. Paid R40 000 by cheque for 6. DR CR

machinery

DR CR

127
EXERCISE 47 Date: ___________ GENERAL LEDGER
ACCOUNTS
A L I E
+ - - + - + + -

1. Banked R45 000 for services 1. DR CR

rendered

DR CR

2. Bank R80 000 for Sales as per DR CR

CRR 2.
133 %

DR CR

DR CR

DR CR

3. Paid Class Advertising Agency 3. DR CR

for advertising by cheque R5 500

DR CR

4. Paid for fuel from petty cash 4. DR Petty Cash CR

R150.00

DR Fuel CR
Petty Cash

5. Restored petty cash 5. DR CR

Issued cheque for R550.00

DR CR

128
EXERCISE 48 Date: ___________
GENERAL LEDGER
Write the transactions into your own
ACCOUNTS
words.
A L I E
+ - - + - + + -

1. 1. DR Capital CR
Bank 20 000

DR Bank CR
Capital 20 000

2. 2. DR Bank CR
Current income 70 000

DR Current income CR

Bank 70 000

3. 3. DR Drawings CR
Bank 600

DR Bank CR
Drawings 600

4. 4. DR Equipment CR
Bank 10 000

DR Bank CR
Equipment 10 000

5. Profit in rands x 100 5. DR Bank CR

% m.u. =
CP 1 Sales 350
Profit = Selling Price - Cost of Sales
DR Sales CR
Show Calculations Bank 350

DR Trading Inventory CR
Cost of Sales 100

DR Cost of Sales CR
Trading Inventory 100

129
EXERCISE 49 Date: ___________
GENERAL LEDGER
Write the transactions into your own
ACCOUNTS
words.
A L I E
+ - - + - + + -
1. Profit in rands x 100 1. DR Bank CR
% m.u. =
CP 1 Sales 650
Show Calculations
DR Sales CR
Bank 650

DR Trading Inventory CR

Cost of Sales 300

DR Cost of Sales CR
Trading Inventory 300

2. 2. DR Bank CR
Current income 20 000

DR Current income CR
Bank 20 000

3. 3. DR Capital CR
Bank 7 000

DR Bank CR
Capital 7 000

4. 4. DR Bank CR
Salaries 15 000

DR Salaries CR
Bank 15 000

5. 5. DR Bank CR
Petty Cash 500

DR Petty Cash CR
Bank 500

130
 EXERCISE 49.1 and 50.1 NAME:_________________________ GRADE:__________ DATE:____________________
TRANSACTION ANALYSIS

GENERAL LEDGER ACCOUNTING EQUATION

Date Source
Document Journal Account DR Account CR A 0/E L
Ex 49.1
01
___________________________________________________________
____________________________________________ _________________________________________________________________________________

02

03
___________________________________________________________________________________________________________________________

04

131
05

Ex 50.1
01

02 ___________________________________________________________
_
03

04

05
TEAR OUT PAGE
 NOTES/CALCULATIONS:

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_____________________________________________________________________
_____________________________________________________________________

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________________________________________

_____________________________________________________________________

132
EXERCISE 50 Date: ___________
GENERAL LEDGER
Write the transactions into your own
ACCOUNTS
words.
A L I E
+ - - + - + + -

1. 1. DR Bank CR

Current income 5 000

DR Current income CR

Bank 5 000

2. Profit 2. DR Bank CR
% m.u. = x 100
CP 1 Sales 20 000
Show Calculations
DR Sales CR
Bank 20 000

DR Trading Inventory CR

Cost of Sales 9 302.33

DR Cost of Sales CR
Trading 9 302.33
inventory
3. 3. DR Capital CR
Bank 100 000

DR Bank CR
Capital 100 000

4. 4. DR Bank CR
Telephone 200

DR Telephone CR
Bank 200

5.
5. DR Bank CR
Stationery 350
DR Stationery CR
Bank 350

133
 NOTES/CALCULATIONS:

______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
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______________________________________________________________________
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134
 THE GENERAL LEDGER
POSTING THE JOURNALS TO THE GENERAL LEDGER (Step 4)

1. When posting journals to the General Ledger we make use of the multiple
posting system.

Helpful RULES for posting different journals to the GENERAL LEDGER

It will be beneficial to know all of these rules off by heart!

CRJ EXTRA RULE

DR Bank CR DR Cost of Sales CR
X X

DR All Contra Accounts CR DR Trading Inventory CR

X X

CPJ PCJ

DR Bank CR DR Petty Cash CR

X X

DR All Contra Accounts CR DR All Contra Accounts CR

X X

Notice that the LHS = RHS or DR = CR

POSTING JOURNALS TO THE GENERAL LEDGER

1. The accounts with columns allocated to them in the journals will be cast
(totalled). These totals will be posted to the General Ledger on the last day of
the month.

2. The accounts that have been detailed in the “sundry accounts” column will be
posted on the day that the transaction was entered.

3. The reasons for the transactions in the Bank account have already been
detailed in the CPJ and CRJ therefore it is uneccessary to repeat these details
in the bank account of the General Ledger ie.

CPJ = Total Payments made from the BANK account

CRJ = Total Receipts BANK (ed)

4. General Ledger account folio numbers will be entered in the respective journals as
a reference eg. N3, B4.

5. The journal number will be entered in the Folio column of the General Ledger
account as the origin of the information eg. CPJ 7.

135
 GENERAL LEDGER ACCOUNTS
A L I E
EXAMPLE + - - + - + + -
Date:
GENERAL LEDGER OF
DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
BALANCE SHEET SECTION
CAPITAL (O/E)

DRAWINGS (O/E) B3
Oct 09 05 Petty Cash PCJ10 50
21 Petty Cash PCJ10 75

BANK (A) B4
Oct 09 31 Total Receipts CRJ10 4 660 Oct 09 31 Total Payments 5 845

TRADING INVENTORY (A) B5

Oct 09 31 Cost of Sales CRJ10 859.09

PETTY CASH (A) B6

Oct 09 13 Bank CPJ10 500 Oct 09 31 Total Payments PCJ10 715

NOMINAL SECTION
SALES (I) N1
Oct 09 31 Bank CRJ10 3 450

COST OF SALES (E) N2

Oct 09 31 Trading Inventory CRJ10 859.09

136
NAME: __________________ GRADE: _______
EXAMPLE TEAR OUT PAGE
PASTE TEAR OUT, JOURNAL PAGES BACK INTO YOUR BOOK

CASH RECEIPTS JOURNAL OF CARDS BY CLAIRE FOR OCTOBER CRJ 10

Analysis Bank Sales Cost Current Sundry Accounts
Doc Date Details of Receipts Income
of Sales Amount Fol Details
048 01 S. Sawyer 500 500 500 227.27
049 02 D. Delport 560
050 02 R. Rowen 400 960 960 436.36
CRR 03 Sales 700 700 700
052 09 B. Blom 600 600 600 272.73
CRR 15 Sales 210 210 210
054 16 C. Clara 720 720 720 N4 Rent Income
055 25 P. Plot 670 670 670 304.55
056 30 V. Verb 300 300 300 136.36
4 660 3 450 859.09 910 720
B4 N1 N2 B5 N3
Cost of Sales is also the value of the Trading Inventory R859.09
CASH PAYMENTS JOURNAL OF C A R D S B Y C L AI R E FOR O C T O BE R CPJ 10
Details of Bank Material Packaging Sundry Accounts
Doc Date Payee Costs Material Wages
Amount Fol Details
718 01 CC Papers 370 370
719 02 CNA 1050 1050
720 02 B. Box 620 620
721 05 RS Suppliers 440 440
722 09 R. Ryan 525 525
723 13 Cash 500 500 B6 Petty Cash
724 17 CC Papers 220 220
725 26 Cash 170 170 N8 Fuel
726 31 Cash 1950 1950
5 845.00 2 015 1 210 1 950 670
B4 N5 N6 N7
PETTY CASH JOURNAL OF CARDS BY CLAIRE FOR O C T O B E R PCJ 1 0
Doc Date Details Petty Stationery Fuel Repairs Sundry Accounts
Cash Amount Fol Details
013 02 Donation 20 20 N11 Donations
014 03 Fuel 40 40
015 05 C. Fitzgerald 50 50 B3 Drawings
016 07 Repairs 25 25
017 09 Stationery 60 60 120
018 10 Fuel 120
019 15 Repairs 125 125
020 21 C. Fitzgerald 75 75 B3 Drawings
021 31 Fuel 200 200
715 60 360 150 145
B6 N9 N8 N10
137
138
DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
CURRENT INCOME (I) N3
Oct '09 31 Bank CRJ 10 910

RENT INCOME (I) N4

Oct '09 16 Bank CRJ10 300

MATERIAL COSTS (E) N5

Oct 09 31 Bank CPJ10 2 015

PACKAGING MATERIAL (E) N6

Oct 09 31 Bank CPJ10 1 210

WAGES (E) N7
Oct 09 31 Bank CPJ10 1 950

FUEL (E) N8
Oct 09 26 Bank CPJ10 170
31 Petty Cash PCJ10 360

STATIONERY (E) N9
Oct 09 31 Petty Cash PCJ10 60

REPAIRS (E) N10

Oct 09 31 Petty Cash PCJ10 150

DONATION (E) N11

Oct 09 02 Petty Cash PCJ10 20

139
EXERCISE 51 Date:

Post the full set of Journals from EXERCISE 36 to the General Ledger

GENERAL LEDGER OF FASTENERS UNLIMITED FOR MARCH 2005

DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
BALANCE SHEET SECTION
CAPITAL (O/E) B1

DRAWINGS (O/E) B2

MACHINERY (A) B3

EQUIPMENT (A) B4

BANK (A) B5

TRADING INVENTORY (A) B6

PETTY CASH (A) B7

NOMINAL SECTION
SALES (I) N1

COST OF SALES (E) N2

140
DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
RENT EXPENSE (E) N3

MATERIAL COSTS (E) N4

PACKAGING MATERIAL (E) N5

WAGES (E) N6

FUEL (E)
N7

TELEPHONE (E)

N8

WATER AND ELECTRICITY (E)

N9

N10

N11

141
EXERCISE 52 Date:

Post the full set of Journals from EXERCISE 37 to the General Ledger

GENERAL LEDGER OF HAIR LOVERS SALON FOR APRIL 2005

DR
Month Day Details Fol Amount Month Day Details Fol Amount
BALANCE SHEET SECTION
CAPITAL (O/E) B1

DRAWINGS (O/E) B2

VEHICLES (A) B3

EQUIPMENT (A) B4

BANK (A) B5

PETTY CASH (A) B6

NOMINAL SECTION
CURRENT INCOME (I) N1

RENT INCOME (I) N2

142
DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
MATERIAL COSTS (E) N3

WAGES (E) N4

POSTAGE E) N5

STATIONERY (E) N6

WATER AND ELECTRICITY (E) N7

143
EXERCISE 53 Date:

Post the full set of Journals from EXERCISE 38 to the General Ledger

GENERAL LEDGER OF TEMPTING TRADERS FOR MARCH 2005

DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
BALANCE SHEET SECTION
CAPITAL (O/E) B1

DRAWINGS (O/E) B2

VEHICLES (A) B3

BANK (A) B4

TRADING INVENTORY (A) B5

PETTY CASH (A) B6

NOMINAL SECTION
SALES (I) N1

RENTINCOME (I) N2

144
DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
COST OF SALES (E) N3

ADVERTISING (E) N4

PACKAGING MATERIAL (E) N5

WAGES (E) N6

POSTAGE (E) N7

TELEPHONE (E) N8

WATER AND ELECTRICITY (E) N9

REPAIRS (E) N10

STATIONERY (E) N11

145
EXERCISE 54 Date:

Post the full set of Journals from EXERCISE 39 to the General Ledger

GENERAL LEDGER OF ARAMEX FOR DECEMBER 20______

DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
BALANCE SHEET SECTION
CAPITAL (O/E) B1

DRAWINGS (O/E) B2

BANK (A) B3

PETTY CASH (A) B4

NOMINAL SECTION
CURRENT INCOME (I) N1

WAGES (E) N2

146
DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
FUEL (E) N3

SECURITY (E) N4

STATIONERY (E) N5

ADVERTISING (E) N6

REPAIRS (E) N7

WATER AND ELECTRICITY (E) N8

SALARIES (E) N9

TELEPHONE (E) N10

147
 BALANCING/TOTALLING THE ACCOUNTS
IN THE GENERAL LEDGER
T

1. BALANCING AND TOTALLING THE ACCOUNTS IN THE BALANCE SHEET SECTION

Example
GENERAL LEDGER OF Hose Traders
DR CR
MONTH DAY DETAILS
AILS AMOUNT MONTH DAY DETAILS
AILS AMOUNT
BALANCE SHEET SECTION
BANK B3
(a) April April
01 Balance b/d 55 000.00 03 Vehicles B4 12 000.00
2005 2005

03 Sales N1 3 500.00 07 Water & Elect. N6 320.00

04 Current income N3 2 700.00 12 Stationery N2 150.00

09 Rent income N8 5 200.00 17 Mat. Costs N5 750.00

25 Packaging N7 900.00

(c) 30 Balance c/d 52 280.00

(b) 66 400.00 (b) 66 400.00

(d) May 01 Balance b/d 52 280.00

2005

148
NAME: __________________ GRADE: _______
Example TEAR OUT PAGE
PASTE TEAR OUT, JOURNAL PAGES BACK INTO YOUR BOOK

DR CR
MONTH DAY DETAILS FOL AMOUNT MONTH DAY DETAILS FOL AMOUNT
BALANCE SHEET SECTION
B4
EQUIPMENT
Sept b/d
2005
01 Balance 7 000.00

12 Bank B3 750.00

19 Bank B3 1 235.00

29 Bank B3 972.00

9 957.00
Oct
2005 01 Bank B3 744.00

This ledger account in the Balance Sheet Section only has entries on one side of the
General Ledger.
A line is drawn under the amount of the last transaction and the account is totalled.

2. BALANCING THE ACCOUNTS IN THE NOMINAL SECTION

DR CR
MONTH DAY DETAILS FOL AMOUNT MONTH DAY DETAILS FOL AMOUNT
NOMINAL SECTION
N5
MATERIAL COSTS
Sept b/d
2005
01 Balance 8 000.00

13 Bank B3 650.00

15 Bank B3 4 235.00

29 Bank B3 872.00

13 757.00
Oct
2005 01 Bank B3 1 200.00

The ledger account in the Nominal Section also only has entries on the one side. It has
also been Balanced as with the previous example.

149
EXERCISE 55 Date: ___________
CASH RECEIPTS JOURNAL OF CANDY LOVE FOR APRIL 20__ CRJ 04
Analysis Cost of Sundry Account
Doc Date Details of receipt Bank Sales Sales Amount Fol Details

034 02 V.Vase 5 000 5 000 5 000 3 448.28

035 03 SPAR 3 200 3 200 3 200 2 206.90
036 07 Wiesenhof 1 150 1 150 793.10
037 07 C. Cindy 10 000 11 150 10 000 B_ Capital
038 09 F. Frost 910 910 910 627.59
039 10 Holiday Inn 600 600 600 413.79
040 15 F. Frost 1 900 1 900 1 900 1 310.34
041 21 V. Valentine 920 920 920 634.48
042 27 P. Sharp 915 915 915 N_ Rent Income
CRR 30 Sales 5 750 5 750 5 750 3 965.52
30 345 19 430 13 400 10 915
N_
B_ N_ B_

CASH PAYMENTS JOURNAL OF CANDY LOVE FOR APRIL 20__ CPJ 04

Packaging Material Sundry Account
Doc Date Details of Payee Bank
Material Costs
Drawings
Amount Fol Details

428 01 Cadbury's 3 200 3 200

429 04 A Arts 450 450
430 05 C. Cindy 15 000 1 000 14 000 N_ Salaries
431 05 Game 2 040 2 040 B_ Equipment
432 05 M. Moulds 1 400 1 400 B_ Equipment
433 15 Cash 440 440 B_ Petty Cash
444 21 Cash 200 200
445 29 C. Cindy 5 000 5 000
446 30 Cadbury's 1 400 1 400
29 130 650 4 600 6 000 17 880
B_ N_ N_ B_
PETTY CASH JOURNAL OF CANDY LOVE FOR APRIL 20__ PCJ 04
Petty Sundry Account
Doc Date Details Cash
Drawings Stationery Wages
Amount Fol Details

028 01 C. Cindy 20 20
029 01 Wages 150 150
030 04 Stationery 20 20
031 07 PNA 45 45
032 09 Fuel 50 50 N_ Fuel
033 10 C. Cindy 25 25
034 21 Wages 300 300
035 21 Stamps 15 15 N_ Postage
036 22 Donations 20 20 N_ Donations
645 45 65 450 85
B_ B_ N_ N_
150
TEAR OUT PAGE NAME: __________________ GRADE: _______
EXERCISE 56 PASTE TEAR OUT, JOURNAL PAGES BACK INTO YOUR BOOK

CASH RECEIPTS JOURNAL OF LIVE CONCERTS FOR SEPT 20__ CRJ 09

Analysis Current Sundry Account
Doc Date Details of receipt Bank Income Amount Fol Details

022 04 V. Vile 2 200 2 200 2 200

023 05 R. Role 1 800 1 800 1 800
024 09 S. Sugar 2 500 2 500
025 09 P. PLane 2 500 5 000 2 500
026 11 R. Ross 4 000 4 000 4 000
027 21 W. Gietl 6 000 6 000 6 000 B_ Capital
028 27 V. Vertigo 4 000 4 000 4 000
23 000 17 000 6 000
B_ N_

CASH PAYMENTS JOURNAL OF LIVE CONCERTS FOR SEPT 20__ CPJ 09

Sundry Account
Doc Date Details of Payee Bank Equipment Fuel Drawings
Amount Fol Details

130 01 Look 'n Listen 1 515 1 515

131 01 Sounds Limited 3 000 3 000
132 03 S. Store 350 350 N_ Storage
133 04 W. Gietl 900 400 500
134 05 W. Gietl 1 300 900 400
135 09 W. Gietl 500 250 250
136 11 W. Gietl 1 000 1 000
137 17 Cash 400 200 200
8 965 5 615 850 2 150 350
B_ B_ N_ B_

PETTY CASH JOURNAL OF LIVE CONCERTS FOR SEPT 20__ PCJ 09

Petty Sundry Account
Doc Date Details Cash
Drawings Fuel Stationery
Amount Fol Details

041 01 W. Gietl 20 20
042 02 Stationery 15 15
043 05 Equipment 200 200 B_ Equipment
044 07 Fuel 50 50
045 09 W. Gietl 20 20
305 40 50 15 200
B_ B_ N_ N_

151
EXERCISE 57
CASH RECEIPTS JOURNAL OF ROSE CANDLES FOR FEB 20___ CRJ 02
Analysis Cost of Current Sundry Account
Doc Date Details of receipt Bank Sales Sales Income Amount Fol Details

082 02 SA Welding 2 000 2 000 1 503.76

083 02 F. Ryan 3 000 5 000 3 000
084 03 SPAR 1 750 1 750 1 750 1 315.79
085 07 Flowers Galore 1 930 1 930 1 930 1 451.13
086 09 Holy Church 1 562 1 562 1 562 1 174.44
087 11 SA Funerals 12 000 12 000 12 000 9 022.56
088 15 Clicks 10 000 10 000 10 000 7 518.80
089 19 S. Super 1 700 1 700 1 700
090 21 R. Solice 5 000 5 000 5 000 B_ Capital
38 942 29 242 21 986.48 4 700 5 000
N_
B_ N_ B_ N_

CASH PAYMENTS JOURNAL OF ROSE CANDLES FOR FEB 20___ CPJ 02

Packaging Material Sundry Account
Doc Date Details of Payee Bank Material Costs Fuel
Amount Fol Details

421 01 P. Price 4 000 4 000

422 01 Z. Zone 1 300 1 300
423 05 B. Butter 5 000 5 000
424 06 Zenex 450 450
425 07 Z. Zone 500 500
426 08 R. Solice 3 000 3 000 B2 Drawings
427 11 Cash 1 500 1 500 B7 Rent Exp
428 21 Cash 300 300 B5 Petty Cash
429 21 Cash 9 000 9 000 N8 Salaries
25 050 4 500 6 300 450 13 800
B3 N4 N5 N6
PETTY CASH JOURNAL OF ROSE CANDLES FOR FEB 20____ PCJ 02
Petty Sundry Account
Doc Date Details Cash
Advertising Postage Stationery
Amount Fol Details

21 02 Advertising 50 50
22 02 Postage 40 40
23 04 Postage 45 45
24 09 Stationery 25 25
25 11 R. Solice 100 100 B2 Drawings
26 11 Advertising 50 50
27 28 Repairs 45 45 N9 Repairs
355 100 85 25 145
B5 N11 N10 N12

152
TEAR OUT PAGE NAME: __________________ GRADE: _______
EXERCISE 58 PASTE TEAR OUT, JOURNAL PAGES BACK INTO YOUR BOOK

CASH RECEIPTS JOURNAL OF SA FLORISTS FOR MAY 20___ CRJ 05

Analysis Cost of Current Sundry Account
Doc Date Details of receipt Bank Sales Sales Income Amount Fol Details

854 01 S. Daisy 1 500 1 500 1 041.67

856 01 H. Harris 1 700 3 200 1 700 1 180.56
ü 03 Sales 3 200 3 200 3 200 2 222.22
857 05 S. Scott 1 750 1 750 1 750
ü 06 Sales 9 721 9 721 9 721 6 750.69
ü 09 Services rendered 1 820 1 820 1 820
858 11 P. Peters 790 790 790 548.61 1 500 Rent Income
859 17 H. Henley 20 000 20 000 20 000 Capital
860 21 T. Thomas 880 880 880 611.11
41 361 17 791 12 354.86 3 570 21 500

CASH PAYMENTS JOURNAL OF SA FLORIST FOR MAY 20___ CPJ 05

Packaging Trading Sundry Account
Doc Date Details of Payee Bank
Material Inventory
Fuel
Amount Fol Details

243 03 Dions 5 000 5 000 Equipment

244 03 Flower Power 2 500 2 500
245 05 Cash 700 700 Petty Cash
246 08 R. Raw 900 900 Rent Expense
247 08 Design Co 3 100 3 100
248 11 Henley 2 500 500 2 500 Drawings
249 17 Cash 5 000 500 4 500 Salaries
250 17 Ekhuruleni 2 160 2 160 Water & Elec
251 29 Boxing Co 1 910 1 910
23 770 5 010 2 500 1 000 15 260

PETTY CASH JOURNAL OF SA FLORISTS FOR MAY 20____PCJ 05

Petty Packaging Sundry Account
Doc Date Details Cash
Wages
Material
Fuel
Amount Fol Details

101 01 Repairs 100 100 Repairs

102 01 Stationery 20 20
103 07 Wages 50 50
104 09 Donations 10 10
105 10 Fuel 50 50
106 11 Henley 50 50 Drawings
107 12 Wages 50 50
108 14 Henley 20 20 Drawings
350 100 10 70 170

153
EXERCISE 59
CASH RECEIPTS JOURNAL OF FASTENERS UNLIMITED FOR APRIL 20___ CRJ 04
Analysis Cost of Sundry Account
Doc Date Details of receipt Bank Sales Sales Amount Fol Details

41 03 Ideal Bolt 17 800

42 03 Impala Bolt 9 900 27 700 27 700 16 787.88
43 07 Global Bolt 15 600 15 600 15 600 9 454.55
44 09 Global Bolt 11 900 11 900 11 900 7 212.12
45 11 R. Keith 25 000 25 000 Capital
46 11 National Bolt 71 500 96 500 71 500 43 333.33
47 12 Ideal Bolt 12 000 12 000 12 000 7 272.73
48 14 Impala Bolt 9 000 9 000 9 000 5 454.55
49 17 Global Bolt 8 700 8 700 8 700 5 272.73
181 400 156 400 94 787.89 25 000

CASH PAYMENTS JOURNAL OF FASTENERS UNLIMITED FOR APRIL 20__ CPJ 04

Packaging Trading Sundry Account
Doc Date Details of Payee Bank Salaries
Materials Inventory Amount Fol Details

057 01 Cash 15 000 15 000

058 01 Cash 5 000 5 000 Rent Expense
059 03 Telkom 3 575 3 575 Telephone
060 04 Ekhuruleni 9 700 9 700 W&Electricity
061 05 Rennies 10 000 10 000
062 07 R. Keith 5 000 5 000 Drawings
063 17 S. Star 7 200 2 200
064 19 SA Steel 1 990 1 990
065 21 SA Steel 5 720 15 720
63 185 15 000 4 190 25 275 23 275

PETTY CASH JOURNAL OF FASTENERS UNLIMITED FOR APRIL 20__ PCJ 04

Petty Sundry Account
Doc Date Details Cash
Repairs Wages Fuel
Amount Fol Details

38 02 Licence 135 135 Licence

39 03 Repairs 25 25
40 07 Wages 50 50
41 08 Fuel 100 100
42 08 Stationery 55 55 Stationery
43 13 R. Keith 100 100 Drawings
44 17 Fuel 50 50
45 21 Repairs 25 25
46 30 Wages 50 50
590 50 100 150 290

154
Exercises 55 - 59 (Posting a full set of Journals to the General Ledger)

Instructions

1) Tear out the Journal page/s for each exercise. You won't have to turn back and forth
to complete the General Ledger.
2) Paste the Journals back into your workbook once you have completed the exercise.

155
 GENERAL LEDGER ACCOUNTS
A L I E
EXERCISE 55 - + - + + -
Date:
+ -
1. Post the Journals to the General Ledger. Use your highlighters to help you 2. Balance the Accounts in the
Balance Sheet Section 3. Total the accounts in the Nominal Section 4. Show folio numbers
DR GENERAL LEDGER OF CANDY LOVE CR
Month Day Details Fol Amount Month Day Details Fol Amount
BALANCE SHEET SECTION
CAPITAL B1
Apr '09 01 Balance b/d 100 000

DRAWINGS B2
Apr '09 01 Balance b/d 5 000

BANK B3
Apr 09 01 Balance b/d 17 000

EQUIPMENT B4
Apr 09 01 Balance b/d 100 000

TRADING INVENTORY B5
Apr 09 01 Balance b/d 31 903.97

PETTY CASH B6
Apr 09 01 Balance b/d 400

NOMINAL SECTION
SALES N1
Apr 09 01 Balance b/d 171 000

COST OF SALES N2
Apr 09 01 Balance b/d 117 931.03

156
DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
RENT INCOME N3
Apr 09 01 Balance b/d 2 745

SALARIES N4
Apr 09 01 Balance b/d 9 000

DONATIONS N5
Apr09 01 Balance b/d 950

FUEL N6
Apr 09 01 Balance b/d 1 500

POSTAGE N7
Apr 09 01 Balance b/d 60

PACKAGING MATERIAL N8
Apr 09 01 Balance b/d 600

MATERIAL COSTS N9
Apr 09 01 Balance b/d 500

STATIONERY N10
Apr 09 01 Balance b/d 300

WAGES N11
Apr 09 01 Balance b/d 900

157
 Date:
EXERCISE 56
1. Post the Journals to the General Ledger. 2. Balance the Balance Sheet Section
3. Total the Nominal Section 4. Show folio numbers
DR GENERAL LEDGER OF LIVE CONCERTS CR
Month Day Details Fol Amount Month Day Details Fol Amount
BALANCE SHEET SECTION
CAPITAL B1
Sept 09 01 Balance b/d 50 000

DRAWINGS B2
Sept 09 01 Balance b/d 2 000

BANK B3
Sept 09 01 Balance b/d 1 500

EQUIPMENT B4
Sept 09 01 Balance b/d 28 275

PETTY CASH B5
Sept 09 01 Balance b/d 500

NOMINAL SECTION
CURRENT INCOME N1
Sept 09 01 Balance b/d 1 700

FUEL N2
Sept 09 01 Balance b/d 1 900

158
DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
STATIONERY N3
Sept 09 01 Balance b/d 175

STORAGE N4
Sept 09 01 Balance b/d 350

159
 GENERAL LEDGER ACCOUNTS
A L I E
Date:
EXERCISE 57 + - - + - + + -
1. Post the Journals to the General Ledger. 2. Balance the Accounts in the Balance Sheet Section
3. Total the accounts in the Nominal Section 4. Show folio numbers
DR GENERAL LEDGER OF ROSE CANDLES CR
Month Day Details Fol Amount Month Day Details Fol Amount
BALANCE SHEET SECTION
CAPITAL B1
Feb 09 01 Balance b/d 70 832.86

DRAWINGS B2
Feb 09 01 Balance b/d 700

BANK B3
Feb 09 01 Balance b/d 9 000

TRADING INVENTORY B4
Feb 09 01 Balance b/d 41 000

PETTY CASH B5
Feb 09 01 Balance b/d 500

NOMINAL SECTION
SALES N1
Feb 09 01 Balance b/d 9 500

COST OF SALES N2
Feb 09 01 Balance b/d 7 142.86

160
DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
CURRENT INCOME N3
Feb 09 01 Balance b/d 3 500

PACKAGING MATERIALS N4
Feb 09 01 Balance b/d 350

MATERIAL COSTS N5
Feb 09 01 Balance b/d 390

FUEL N6
Feb 09 01 Balance b/d 1 800

RENT EXPENSE N7
Feb 09 01 Balance b/d 790

SALARIES N8
Feb 09 01 Balance b/d 7 000

REPAIRS N9
Feb 09 01 Balance b/d 1 600

POSTAGE N10
Feb 09 01 Balance b/d 50

ADVERTISING N11
Feb 09 01 Balance b/d 150

STATIONERY N12
Feb 09 01 Balance b/d 360

161
 GENERAL LEDGER ACCOUNTS
A L I E
EXERCISE 58 Date:
+ - - + - + + -
1. Open the Accounts in the General Ledger of SA Florists 2. Post the Journals to the General Ledger
3. Balance the Balance Sheet Section Accounts 4.Total the accounts in the Nominal Section 5. Show the folio numbers
DR GENERAL LEDGER OF SA FLORISTS CR
Month Day Details Fol Amount Month Day Details Fol Amount
BALANCE SHEET SECTION

NOMINAL SECTION

162
DR CR
Month Day Details Fol Amount Month Day Details Fol Amount

BALANCE SHEET ACCOUNT OPENING BALANCES/ NOMINAL ACCOUNTS OPENING BALANCES/

LINES REQ( ) LINES REQ( )
Capital (5) R 55 639.17 Sales (4) R 9 150
Drawings (7) R 5 000 Cost of Sales (4) R 6 354.17
Equipment (5) R 3 000 Current Income (4) R 7 780
Trading Inventory (5) R 3 500 Rent Income (4) R11 100
Bank (5) R 7 000 Repa
Repairs (4) R 360
Petty Cash (5) R 500 Rent Expense (4) R 2 900
Fuel (5) R 4 555
Salaries (4) R11 500
Water & Electricity (4) R 7 500
Packaging Material (5) R 1 550
Wages (4) R 350

163
 GENERAL LEDGER ACCOUNTS
A L I E
Date:
EXERCISE 59 + - - + -- + + --
1. Open the Accounts in the General Ledger of Fasteners Unlimited 2. Post the Journals to the General Ledger.
3. Balance the Accounts in the Balance Sheet Section 4. Total the accounts in the Nominal Section
5. Show folio numbers
DR GENERAL LEDGER OF FASTENERS UNLIMITED CR
Month Day Details Fol Amount Month Day Details Fol Amount
BALANCE SHEET SECTION

NOMINAL SECTION

164
DR CR
Month Day Details Fol Amount Month Day Details Fol Amount

BALANCE SHEET ACCOUNTS OPENING BALANCES ( ) = LINES NEEDED

Capital (5) R 70 000
Drawings (6) R 7 500
Trading Inventory (5) R 200 000
Bank
Ba nk (5) R 82 000
Petty Cash (5) R 60

NOMINAL SECTION NOMINAL SECTION

Sale
Sales (4) R 29 000
Cost of Sales (4) R 18 000
Salaries (4) R 85 000
Packing Materials (4) R 15 500
Rent Expenses (4) R 9 000
Telephone (4) R 600
Water & Electricity (4) R 320
Licence (4) R 120
Stationery (4) R 750
Repairs (4) R 775
Fuel (4) R 990
Wages (4) R 12 600

165
 THE ACCOUNTING CYCLE
STEP 1. TRANSACTIONS

CASH CREDIT

STEP 2. SOURCE DOCUMENTS - DUPLICATE OR ORIGINAL

Deposit slip (Duplicate) Invoice
Receipt Credit Note
Till Slip
Cheque counterfoil
Petty Cash Voucher
Bank Statement
STEP 3. CASH JOURNALS CREDIT JOURNALS
DAILY

CRJ
CPJ

CAJ
DAJ
DJ

CJ
PCJ
POST ALL JOURNALS TO THE GENERAL LEDGER AND SUBSIDIARY LEDGERS

STEP 4. THE GENERAL LEDGER SUBSIDIARY LEDGERS

DAILY
CR DEBTORS & CREDITORS LEDGERS
& DR
DETAILS DEBIT CREDIT BALANCE
MONTHLY BALANCE SHEET SECTION

NOMINAL SECTION * Do NOT get posted to the Trial Balance

* Used to draw up the Debtor's & Creditor's
Statements

STEP 5. THE TRIAL BALANCE

MONTHLY DEBITS = CREDITS
STEP 6. FINANCIAL STATEMENTS
ANNUALLY L NOMINAL SECTION = BALANCE SHEET SECTION =
P R O F I T INCOME STATEMENT BALANCE SHEET
S (A = O + L)
S 166
 THE TRIAL BALANCE
1. The T Trial (test) Balance is a summary of all the General Ledger account balances.
2. The Trial Balance tests the accuracy of the double entry and arithmetical
correctness of the accounts.
3. The sum of the Debit (LHS) balances must be equal to the sum of the Credit (RHS)
balances.
4. The Trial Balance is drawn up at the end of the month.
5. The Trial Balance is split into a Balance Sheet Section and a Nominal Section
(As with the General Ledger)

The Trial Balance is drawn up at the end of the accounting period (month).
These amounts then become the opening Balances for the next accounting period ie. The
opening balances/totals are posted to the General Ledger for the following period (month).

FORMAT OF A TRIAL BALANCE

TRIAL BALANCE OF
(A) HAIR DYE SALON

ON (B) 30 JUNE 2005

BALANCE SHEET SECTION (C) (E) Fol (F) Debit (G) Credit

Capital B1 52 050.00
Drawings B2 525.00
Bank B3 1 745.00
Land + buildings B4 79 000.00
Equipment B5 12 000.00
Trading inventory B6 2 000.00
Petty cash B7 300.00
Cash float etc. B8 450.00

NOMINAL SECTION (D)

Sales N1 28 000.00
Current income N2 48 000.00
Rent income N3 15 000.00
Cost of sales N4 23 500.00
Wages N5 17 000.00
Telephone N6 5 255.00
Stationery N7 725.00
Packaging material etc. N8 550.00
(H) (I)
143 050.00 143 050.00
(A) Name of the company
(B) Specific date ie. Last day of the accounting period
(month)
(C) General ledger accounts as they appear in the
Balance sheet section
(D) General ledger accounts as they appear in the
Nominal section
(E) Folio numbers of the General ledger accounts
(F) Debit balances (LHS)
(G) Credit balances (RHS)
(H) Total debit balances
(I) Total credit balances

167
EXAMPLE OF A TRIAL BALANCE
GENERAL LEDGER OF A.A. SPARES
DR CR
BALANCE SHEET SECTION
MONTH DAY DETAILS FOL AMOUNT MONTH DAY DETAILS FOL AMOUNT
CAPITAL B1
Feb 05 01 Balance b/d 104 230.00
01 Bank CRJ6 15 200.00
119 430.00

DRAWINGS B2
Feb 05 01 Balance b/d 1 500.00
05 Petty Cash PCJ6 50.00
1 550.00

BANK B3
Feb 05 01 Balance b/d 21 000.00 Feb 05 28 Total Payments CPJ6 33 702.00
28 Total Receipts CRJ6 27 132.00 28 Balance c/d 14 430.00
48 132.00 48 132.00
Mar 05 01 Balance b/d 14 430.00

LAND AND BUILDINGS B4

Feb 05 01 Balance b/d 41 080.00
41 080.00

VEHICLES B5
Feb 05 01 Balance b/d 15 000.00
28 Bank CPJ6 16 212.00
31 212.00

TRADING INVENTORY B6
Feb 05 01 Balance b/d 27 200.00 Feb 05 28 Cost of Sales CRJ6 4 900.00
28 Bank CPJ6 1 200.00 28 Balance c/d 23 500.00
28 400.00 28 400.00
Mar 05 01 Balance b/d 23 500.00

PETTY CASH B7
Feb 05 01 Balance b/d 450.00 Feb 05 28 Total Payments PCJ6 525.00
15 Bank CPJ6 500.00 28 Balance c/d 425.00
950.00 950.00
Mar 05 01 Balance b/d 425.00

NOMINAL SECTION
SALES N1
Feb 05 01 Balance b/d 7 500.00
28 Bank CRJ6 5 812.00
13 312.00

COST OF SALES N2
Feb 05 01 Balance b/d 5 000.00
28 Trading Inventory CRJ6 4 900.00
9 900.00

168
DR CR
MONTH DAY DETAILS FOL AMOUNT MONTH DAY DETAILS FOL AMOUNT
CURRENT INCOME N3
Feb 05 01 Balance b/d 5 000.00
21 Bank CRJ6 5 200.00
10 200.00

RENT INCOME N4
Feb 05 01 Balance b/d 3 500.00
14 Bank CRJ6 920.00
4 420.00

WAGES N5
Feb 05 01 Balance b/d 5 000.00
28 Bank CPJ6 5 000.00
28 Petty Cash PCJ6 100.00
10 100.00

STATIONERY N6
Feb 05 01 Balance b/d 700.00
5 Bank CPJ6 1 520.00
28 Petty Cash PCJ6 125.00
2 345.00

PACKAGING MATERIAL N7
Feb 05 01 Balance b/d 2 700.00
12 Bank CPJ6 9 270.00
11 970.00

TELEPHONE N8
Feb 05 01 Balance b/d 600.00
28 Petty Cash PCJ6 250.00
850.00

169
 TRIAL BALANCE OF
AA SPARES

ON 28 FEB 2005
BALANCE SHEET FOL DEBIT CREDIT
Capital B1 119 430.00
Drawings B2 1 550.00
Bank B3 14 430.00
Land & Buildings B4 41 080.00
Vehicles B5 31 212.00
Trading Inventory B6 23 500.00
Petty Cash B7 425.00

NOMINAL SECTION
Sales N1 13 312.00
Cost of Sales N2 9 900.00
Current Income N3 10 200.00
Rent Income N4 4 420.00
Wages N5 10 100.00
Stationery N6 2 345.00
Packaging Material N7 11 970.00
Telephone N8 850.00
147 362.00 147 362.00

170
EXERCISE 60
Date: _________
GENERAL LEDGER TEMPTING TRADERS
DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
BALANCE SHEET SECTION
CAPITAL B1
Feb
2005 01 Balance b/d 191 371.13
01 Bank CRJ3 35 000.00
17 Bank CRJ3 5 000.00
231 371.13

DRAWINGS B2
Feb
2005 01 Balance b/d 1 200.00
09 Bank CRJ3 500.00
15 Petty Cash PCJ3 50.00
1 750.00

BANK B3
Feb
2005 01 Balance b/d 15 725.15 Feb
2005 28 Total payments CPJ3 30 975.70
09 Bank CRJ3 73 919.98 28 Balance c/d 58 669.43
89 645.13 89 645.13
01 Balance b/d 58 669.43

LAND AND BUILDINGS B4

Feb
2005 01 Balance b/d 100 412.98
100 412.98

VEHICLES B5
Feb
2005 01 Balance b/d 10 000.00
18 Bank CPJ3 12 000.00
22 000.00

TRADING INVENTORY B6
Feb
2005 01 Balance b/d 60 000.00 Feb
2005 28 Cost of sales CRJ3 22 335.98
31 Bank CPJ3 10 577.00 28 Balance c/d 48 241.02
70 577.00 70 577.00
Mar
2005 01 Balance b/d 48 241.02

PETTY CASH B7
Feb
2005 01 Balance b/d 50.00 Feb
2005 28 Total Payments PCJ3 182.00
12 Bank CPJ3 250.00 28 Balance c/d 118.00
300.00 300.00
Mar
2005 01 Balance b/d 118.00

171
DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
CASH FLOAT B8
Feb
2005 01 Balance b/d 4 500.00
4 500.00

NOMINAL SECTION
SALES N1
Feb
2005 01 Balance b/d 15 000.00
01 Bank CRJ3 27 919.98
42 919.98

COST OF SALES
Feb
2005 01 Balance b/d 6 000.00 N2
28 Trading inventory CRJ3 22 335.98
28 335.98

RENT INCOME N3
Feb
2005 01 Balance b/d 1 500.00
08 Bank CRJ3 3 000.00
28 Bank CRJ3 3 000.00
7 500.00

TELEPHONE N4
Feb
2005 01 Balance b/d 372.00
05 Bank CPJ3 700.00
1 072.00

REPAIRS N5
Feb
2005 01 Balance b/d 100.00
04 Bank CPJ3 275.00
375.00

WAGES N6
Feb
2005 01 Balance b/d 4 500.00
28 Bank CPJ3 5 750.00
28 Petty cash PCJ3 35.00
10 285.00

PACKAGING MATERIAL N7
Feb
2005 01 Balance b/d 1 600.00
10 Bank CPJ3 70.30
16 Bank CPJ3 127.52
1 797.82

172
DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
WATER AND ELECTRICITY N8
Feb Balance
2005 01 b/d 1 721.00
16 Bank CPJ3 350.71
2 071.71

STATIONERY N9
Feb
2005 01 Balance b/d 720.00
28 Petty cash PCJ2 27.00
747.00

POSTAGE N10
Feb Balance
2005 01 b/d 70.00
28 Petty cash PCJ3 70.00
140.00

ADVERTISING N11
Feb Balance
2005 01 b/d 900.00
02 Bank CPJ3 375.17
1 275.17

173
Draw up the Trial Balance of Tempting Traders
TRIAL BALANCE OF
TEMPTING TRADERS

ON 28 FEBRUARY 2005
BALANCE SHEET SECTION FOL DEBIT CREDIT
Capital
Drawing
Bank
Land & Buildings
Vehicles
Trading Inventory
Petty Cash
Cash Float

NOMINAL SECTION
Sales
Cost of sales
Rent income
Telephone
Repairs
Wages
Packaging Material
Water & Electricity
Stationery
Postage
Advertising
281 791.11

174
EXERCISE 61
Date:
GENERAL LEDGER OF K. KLEIN TRADERS
DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
BALANCE SHEET SECTION
CAPITAL B1
Feb
2005 01 Balance b/d 115 550.00
03 Bank CRJ4 20 000.00
135 550.00

DRAWINGS B2
Feb
2005 01 Balance b/d 1 000.00
02 Petty Cash PCJ4 50.00
1 050.00

BANK B3
Feb
2005
01 Balance b/d 21 000.00 Feb
2005
28 Total payments CRJ4 57 900.00
28 Total receipts CPJ4 46 020.00 28 Balance c/d 9 120.00
67 020.00 67 020.00
Mar
2005 01 Balance b/d 9 120.00

VEHICLES B4
Feb
2005
01 Balance b/d 54 009.00
54 009.00

EQUIPMENT B5
Feb
2005 01 Balance b/d 12 000.00
28 Bank CPJ4 13 000.00
25 000.00

TRADING INVENTORY B6
Feb
2005
01 Balance b/d 23 59 Feb
2005
28 Cost of sales CPJ4 7 500.00
28 Bank CPJ4 36 000.00 28 Balance c/d 52 000.00
59 500.00 59 500.00
Mar
2005 01 Bank b/d 52 000.00

PETTY CASH B7
Feb
2005 01 Balance b/d 200.00 Feb
2005
28 Total Payments PCJ4 247.00
19 Bank CPJ4 500.00 28 Balance c/d 453.00
700.00 700.00
Mar
2005 01 Balance b/d 453.00

NOMINAL SECTION
SALES N1
Feb 12 000.00
2005 01 Balance b/d
28 Bank CRJ4 16 720.00
28 720.00

175
DR CR
Month Day Details Fol Amount Month Day Details Fol Amount
COST OF SALES N2
Feb 01 b/d 7 200.00
2005 Balance
28 Trading inventory CRJ4 7 500.00
14 700.00

CURRENT INCOME N3
Feb
2005 01 Balance b/d 1 725.00
12 Bank CRJ4 2 500.00
28 Bank CRJ4 1 800.00
6 025.00

RENT INCOME N4
Feb Balance
2005 01 b/d 1 500.00
07 Bank CRJ4 5 000.00
6 500.00

WAGES N5
Feb 9 000.00
2005
01 Balance b/d
28 Bank CPJ4 6 400.00
28 Petty cash PCJ4 50.00
15 450.00

STATIONERY N6
Feb 729.00
2005 01 Balance b/d
03 Bank CPJ4 1 250.00
28 Petty cash PCJ4 10.00
1 989.00

MATERIAL COSTS N7
Feb
2005 01 Balance b/d 562.00
03 Bank CPJ4 750.00
1 312.00

TELEPHONE N8
Feb 625.00
2005 01 Balance b/d
28 Petty cash PCJ4 50.00
675.00

REPAIRS N9
Feb 01 860.00
2005 Balance b/d
07 Petty cash PCJ4 75.00
935.00

POSTAGE N10
Feb 01 90.0
2005 Balance b/d
14 Petty cash PCJ4 12.00
102.00

176
! Draw up the Trial Balance of K.Klein

TRIAL BALANCE OF
___________________________

ON ___________________________
BALANCE SHEET FOL DEBIT CREDIT

NOMINAL SECTION

177
 THE ACCOUNTING PROCESS / CYCLE

1. TRANSACTIONS

CASH CREDIT

2. CASH TRANSACTIONS - Source documents CREDIT TRANSACTIONS - Source documents

Duplicate Cash Register Roll (CRR) Original

ate
Duplic

Duplicate Receipt Duplicate Invoice (Original issued to Debtors)

Cheque Counterfoil Original Invoices (Received from Creditors)

Petty Cash Voucher

3. CASH JOURNALS (Daily) CRJ CREDIT JOURNALS (Daily) DJ

CPJ CJ
PCJ

CASH RECEIPTS JOURNAL - CRJ DEBTORS JOURNAL - DJ

CASH PAYMENTS JOURNAL - CPJ CREDITORS JOURNAL - CJ

PETTY CASH JOURNAL - PCJ

POST ALL JOURNALS TO THE GENERAL LEDGER POST ALL JOURNALS TO THE SUBSIDIARY LEDGERS

SUBSIDIARY LEDGERS (Post daily from the Journals)

4. GENERAL LEDGER (Posting daily and monthly)
4.1 DEBTORS LEDGER

DETAILS DEBIT CREDIT BALANCE

DR CR

Ÿ Does not get posted to the Trial Balance

Ÿ Used to draw up the Debtors' Statements
Double entry rule

4.2 CREDITORS LEDGER

5. TRIAL BALANCE (Drawn up monthly)
DETAILS DEBIT CREDIT BALANCE

DEBITS = CREDITS
Ÿ Does not get posted to the Trial Balance
Ÿ Used to reconcile Creditors' Statements
Financial Statements
Income Statement: In order to prepare the
Income Statement, information from the Trial Balance is
needed. All income and expenses are recorded to show if a
PROFIT or LOSS was made.
Balance Sheet: In order to complete the Balance Sheet,
information from the Trial Balance and Income Statement
is needed.

6. FINANCIAL STATEMENTS (Drawn up annually)

6.1 INCOME STATEMENT 6.2 BALANCE SHEET A O+L

PROFIT/LOSS ASSETS = OWNERS EQUITY + LIABILITIES

178
 FORMAT AND EXAMPLE OF AN INCOME STATEMENT
R. RACER WHOLESALERS (A)
INCOME STATEMENT FOR THE YEAR ENDED FEBRUARY 2005 (B)

Sales 127 000.00

(C) Cost of sales (63 000.00)
Current income 73 000.00
(D) Gross profit 137 000.00

(E) Other operating income 22 000.00 (F)

Rent income 22 000.00

(G) Gross operating income 159 000.00

(I) Operating expenses (71 560.00)

Telephone 5 000.00
Stationary 7 525.00
Packaging material 7 200.00
(H) Material cost 9 000.00
Water end electricity 12 000.00
Advertising 11 500.00
Fuel 6 335.00
Wages 13 000.00

(J) Net profit for year 87 440.00

The Gross Operating Income is greater than the Operating Expenses therefore
RR WHOLESALERS made a net profit. If the Operating Expenses were greater than
the Gross Operating Income, RR Wholesalers would have made a Net Loss.

NOTE!
Columns are
NOTE:
not
Debit and Credit

A) Name and Company.

B) Month and Year that the Income Statement is prepared.
C) Income due to Sales of Goods and/or Services less cost of sales.
(Information from the Trial Balance).
D) Gross Profit is the profit made by the company excluding “Other Operating
Income”.
E) Other Operating Income is income generated by the business other than
T

sales of goods and/or services e.g. Rent Income (From Trial Balance)
F) Total “Other Operating Income”.
G) T Gross Operating Income. “Gross Profit” including “Other Operating income”.
(D plus F)
H) Expenses incurred for the day to day running of the business (information from the
Trial Balance).
I) (Less) Total T “Operating Expenses”.
J) T Net Profit/Loss = Gross Operating Income - Operating Expenses.

179
EXAMPLE
Date:

TRIAL BALANCE OF
FASTENERS UNLIMITED

ON 28 FEBRUARY 2005
BALANCE SHEET FOL DEBIT CREDIT
Capital B1 500 000
Drawings B2 270 000
Bank B3 120 000
Land & Buildings B4 326 617
Vehicles B5 57 000
Trading Inventory B6 28 000
Petty Cash B7 500

NOMINAL SECTION
Sales N1 590 217
Cost of Sales N2 200 900
Current Income N3 5 000
Rent Income N4 35 000
Wages N5 90 800
Stationery N6 5 400
Packaging Material N7 14 000
Telephone N8 17 000
1 130 217 1 130 217

180
! Prepare the Income Statement for A.A. Spares for the year ending June 2005.
Refer to the Trial Balance of Fasteners Unlimited. Calculate the Net Profit/Loss.

FASTENERS UNLIMITED

INCOME STATEMENT FOR THE YEAR ENDED FEBRUARY 2005

Sales 590 217
Cost of sales (200 900) (minus)
Current income 5 000
Gross profit 394 317 ...a

Other operating income 35 000 ...b

Rent income 35 000

Gross Operating Income 429 317 ... a+b

Operating Expenses (127 200) ... c

Wages 90 800
Stationery 5 400
Packaging material 14 000
Telephone 17 000

Net Profit for the Year 302 117 ... (a+b)-c

181
EXERCISE 62 Date: _____________

TRIAL BALANCE OF
K. KLEIN

ON 28 FEBRAURY 2005
BALANCE SHEET FOL DEBIT CREDIT
Capital B1 135 550.00
Drawings B2 1 050.00
Bank B3 9 120.00
Vehicles B4 54 009.00
Equipment B5 25 000.00
Trading Inventory B6 52 000.00
Petty Cash B7 453.00

NOMINAL SECTION
Sales N1 28 720.00
Cost of Sales N2 14 700.00
Current Income N3 6 025.00
Rent Income N4 6 500.00
Wages N5 15 450.00
Stationery N6 1 989.00
Material costs N7 1 312.00
Telephone N8 675.00
Repairs N9 935.00
Postage N10 102.00
176 795.00 176 795.00

182
 Prepare the Income Statement for K. Klein Traders for the year ending
! February 2005. Trial Balance of K. Klein. Calculate the Net Profit/Loss.

INCOME STATEMENT FOR THE YEAR ENDED

Sales
Cost of sales
Current income
Gross profit

Other operating income

Rent income

Gross Operating Income

Operating Expenses
Wages
Stationery
Material costs
Telephone
Repairs
Postage

Net Profit for the Year

183
EXERCISE 63 Date: _____________

TRIAL BALANCE OF
TEMPTING TRADERS

ON 28 February 2005
BALANCE SHEET SECTION FOL DEBIT CREDIT
Capital B1 231 371.13
Drawing B2 1 750.00
Bank B3 58 669.43
Land & Buildings B4 100 412.98
Vehicles B5 22 000.00
Trading Inventory B6 48 241.02
Petty Cash B7 118.00
Cash Float B8 4 500.00

NOMINAL SECTION
Sales N1 42 919.98
Cost of sales N2 28 335.98
Rent income N3 7 500.00
Telephone N4 1 072.00
Repairs N5 375.00
Wages N6 10 285.00
Packaging Material N7 1 797.82
Water & Electricity N8 2 071.71
Stationery N9 747.00
Postage N10 140.00
Advertising N11 1 275.17
281 791.11 281 791.11

184
! Prepare the Income Statement for Tempting Traders, for the year ending
February 2005. Refer to the Trial Balance exercise 11. Calculate the net
Profit/Loss.

TEMPTING TRADERS

INCOME STATEMENT FOR THE YEAR ENDED FEBRUARY 2005

Sales
Cost of sales
Gross profit

Other operating income

Rent income

Gross Operating Income

Operating Expenses
Telephone
Repairs
Wages
Packaging material
Water & electricity
Stationery
Postage
Advertising

Net Profit for the Year 4 320.30

185
 THE BALANCE SHEET

The Balance Sheet is extracts of information from the Trial Balance and
Income Statement. It does not form part of the double entry system. Assets are shown
first then Owner’s Equity and Liabilities.

Assets = Owner’s Equity + Liabilities

A O/E+L

The Balance Sheet is a snapshot of a business's

financial condition at a specific moment in time,
usually at the close of an accounting period.

A Balance Sheet helps a small business owner quickly get a handle on the financial
strengths/weaknesses and capabilities of the business.

Balance Sheets along with Income Statements, are the most basic elements in
providing financial reporting to potential lenders such as banks, investors and vendors
(creditors) who are considering how much credit to give the firm.

THE ASSETS ARE DIVIDED INTO NON-CURRENT ASSETS AND CURRENT ASSETS.

A NON CURRENT (FIXED) ASSETS consist of land and buildings, vehicles and
equipment and are collectively described as “property, plant and equipment".

B CURRENT ASSETS either consist of cash or can be converted to cash within a

year. Examples are “Inventory” (trading stock), “Trade and other debtors” and “Cash
and cash equivalents” e.g. cash in the bank, petty cash and cash float.

OWNER’S EQUITY

The Owner’s Equity is calculated as follows:

1. We start with the balance of the capital account at the end of the previous
accounting period (Trial Balance)
2. add the net profit/subtract a net loss (Income Statement) for the current
accounting period (Year)
3. and subtract any drawings by the owner. (Trial balance).

NOTE: We use “ NOTES” to provide details of the items

found in the Balance sheet.
see *

186
 FORMAT AND EXAMPLE OF A BALANCE SHEET
NOTE!
DAWN TRADERS Columns are
not
BALANCE SHEET AT 28 FEBRUARY 2005 Debit and Credit

ASSETS Notes
A Non current assets 150 265.00
Property, plant and equipment 1 150 265.00

B Current assets 54 700.00

Inventory 2 25 000.00
Cash and cash equivalents 3 29 700.00

Total assets 204 965.00

EQUITY AND LIABILITIES

Owner’s Equity 4 204 965.00

Total Equity and Liabilities 204 965.00

* NOTES:

1. Property, plant and equipment

Land and building 60 000.00
Vehicles 50 000.00
Equipment 40 265.00
150 265.00
2. Inventory
Trading inventory 25 000.00
25 000.00
3. Cash and cash equivalents
Bank 27 000.00
Petty cash 250.00
Cash float 2 450.00
29 700.00
4. Owner’s equity
Balance of the capital from previous accounting period 173 565.00
Add net profit 54 000.00
Subtract Drawings (22 600.00)
204 965.00

187
EXAMPLE OF A BALANCE SHEET Date:
! Prepare the Balance Sheet of Fasteners Unlimited on the 28th February 2005
! Use the info provided in the trial balance and income statement on pages 180 & 181

FASTENERS UNLIMITED A O/E+L

BALANCE SHEET AT 28 FEB 2005

ASSETS Notes
Non current assets 383 617
Property, plant and equipment 1 383 617

Current assets 148 500

Inventory 2 28 000
Cash and cash equivalents 3 120 500

Total assets 532 117

EQUITY AND LIABILITIES

Owner’s Equity 4 532 117 532 117
Total Equity and Liabilities 532 117

NOTES:

1. Property, plant and equipment

Land and building 326 617
Vehicles 57 000

383 617
2. Inventory
Trading inventory 28 000
28 000
3. Cash and cash equivalents
Bank 120 000
Petty cash 500
120 500

4. Owner’s equity
Balance of the capital from previous accounting period 500 000.00
Add net Profit 302 117.00
Subtract Drawings (270 000)
532 117.00

188
EXERCISE 64 Date:

! Prepare the Balance Sheet of K Klein Traders on the 28th February 2005
! Use the data provided in the trial balance and income statement on pages 182 & 183

A O/E+L

BALANCE SHEET AT

ASSETS Notes
Non current assets
Property, plant and equipment 1

Current assets
Inventory 2
Cash and cash equivalents 3

Total assets

EQUITY AND LIABILITIES

Owner’s Equity 4
Total Equity and Liabilities

NOTES:

1. Property, plant and equipment

Equipment
Vehicles

2. Inventory
Trading inventory

3. Cash and cash equivalents

Bank
Petty cash

4. Owner’s equity
Balance of the capital from previous accounting period 135 550.00
Add net Profit
Subtract Drawings

189
EXERCISE 65 Date:
! Prepare the Balance Sheet of Tempting Wholesalers for the year ending
28 February 2005
! Use the data provided on pages 184 & 185
A O/E+L

BALANCE SHEET AT

ASSETS Notes
Non current assets
Property, plant and equipment 1

Current assets
Inventory 2
Cash and cash equivalents 3

Total assets

EQUITY AND LIABILITIES

Owner’s Equity 4
Total Equity and Liabilities

NOTES:

1. Property, plant and equipment

Land and building
Vehicles

2. Inventory
Trading inventory

3. Cash and cash equivalents

Bank
Petty cash
Cash float

4. Owner’s equity
Balance of the capital from previous accounting period 231 371.13
Add net profit
Subtract Drawings

190