Practical Completion Point 1
Alistair Adin runs a business Al Adin’s Lamps and Rugs that specialises in ornaments and interior design. He has contacted you for some assistance in setting up a new accounting system. Alistair has managed to collect enough information to create a chart of accounts for you to work from.
This completion point comprises two tasks:
1. Setting up a new system by completing an opening entry and any other relevant journal entries and posting these appropriately; and
2. Entering a set of transactions into the general journal and then recording these in the relevant ledgers. After completing these task you will need to review your work and submit.
Please note that all journals, for the purpose of Practical Completion Point 1 should be recorded in the General journal.
You do not need to balance any of the General Ledger Accounts.
You have been provided with an Excel File which contains the General Journal and Ledger Accounts. The necessary accounts as well as blank accounts to be used if needed have been included. You will need to complete this task by entering the relevant information into the excel spreadsheet provided.
Enter the information below from the chart of accounts and schedules in order to set up Alistair’s new system as an Opening Entry into General Journal and post the relevant information to the General Ledger Accounts provided in the excel file.
Al Adin’s Lamps and Rugs - Chart of Accounts as at 1 July 2019
103 Petty Cash 120.00
105 Bank 2,380.00
107 Accounts Receivable Control 9,438.00
109 Allowance for Bad and Doubtful Debts 676.00
111 Inventory 3,458.00
113 Stationery on Hand 220.00
115 Prepaid Insurance 2,400.00
116 Prepaid Rent 12,000.00
140 Warehouses 96,000.00
141 Acc. Depreciation – Warehouses 24,000.00
150 Delivery Vehicle 63,000.00
151 Acc. Depreciation – Delivery Vehicle 13,280.00
160 Shop Fittings 16,400.00
161 Accumulated Depreciation – Shop Fittings 8,460.00
207 Accounts Payable Control 6,149.00
205 Accrued Wages 1,498.00
210 Telephone Expense Payable 264.00
220 Vehicle Maintenance Payable 385.00
299 GST 1,250.00
250 Credit Giving Society Loan (15-year) 103,000.00
303 Capital – Alistair Adin 46,454.00
You need to enter the information below into the appropriate subsidiary ledger accounts.
Schedule of Accounts Receivable
as at 1 July 2019
10701 Just the Palace 1,562
10703 Agro’s Bazzar 649
10705 Arabian Night Lights 3,278
10707 Genieus Home Ideas 3,949
Schedule of Accounts Payable
as at 1 July 2019
20701 Tarnished Lamps 2,145
20703 Jars from Afar 825
20705 Rugs in the Air 3,179
Using the excel file you have already been working on, enter the transactions below into the General Journal and then update the Ledger accounts as required.
July 1 Purchased 10 Hand Woven Rugs from Rugs in the Air. Each rug cost $330 (including GST).
July 2 Sold 25 Table Lamps to Arabian Night Lights for $58 each (net of GST).
July 5 Made a cash sale of 3 rugs to Iago Bird for $750 each (net of GST)
July 8 Paid the full amount owed to Jars from Afar less a 5% discount for early payment.
July 10 Sold 60 candles to Agro’s Bazzar for $40 each (net of GST).
July 12 Received cash (net of GST) from Ms Jasmine Rajah for completing a home inspection and interior design options report. The fee for this service was $620 (net of GST).
July 13 Paid all employees their fortnightly wages. The total cash payment was $2,200 (GST Free).
July 15 Purchases 50 “Scents of the Desert” candles for $25 each from Tarnished Lamps. An additional delivery charge of $50 was incurred (All amounts are net of GST).
Once you have completed the data entry in the above two tasks, you will need to upload your excel file to learnonline so they can be checked for completeness.
Remember at this point accuracy of data entry is not being checked, only that all transactions have been entered into the correct accounts by following the correct processes. However, it is expected that students will make every effort to achieve the correct result which they can then compare to the feedback provided after all submissions are made.