new economic and management sciences ems grade 9 … 9 ems... · 2020. 7. 2. · 2 assets b an...

NAME: ___________________________________ SURNAME: _______________________________ GRADE: 9_____

ECONOMIC AND MANAGEMENT SCIENCES

EMS

GRADE 9

LEARNER BOOK

2

MODULE 1

FINANCIAL CONCEPTS AND ACCOUNTING EQUATION

REVISION - BASELINE ASSESSMENT (as shown on the PPT)

PRESENTATION

Presentation by facilitator on Financial Concepts

ACTIVITY 1 Concepts are listed in COLUMN A and explanations are listed in COLUMN B. Choose an explanation from COLUMN B that matches a concept in COLUMN A. Write only the letter (A – U) next to the question number.

COLUMN A COLUMN B

1 Capital A Is that amount of earnings/income that is not consumed

2 Assets B An accounting entry made on the right hand side of the general ledger account.

3 Liabilities C Formal documents for the recording of financial activities.

4 Income D Represents all cash monies received by the business

5 Expenses E • An accounting entry made on the left hand side of the general ledger account.

6 Profit F The amount of money the owner(s) contribute to the business

7 Losses G Where the income of the business is greater than the expenses

8 Budgets H A = OE + L

9 Savings I Are the possessions that belong to the business

10 Banking J A list of all planned expenses and revenues

11 Financial Records K Represents all cash payments made by the business

12 Transactions L These are books of first entry where all financial transactions are recorded

13 Sole Trader M A process of depositing monies received into a commercial institution.

14 Debit N Is a single owner business

15 Credit O Takes place when commercial business is done and monies are exchanged

16 Owner’s Equity P Where the expenses of the business is greater than the income.

17 Cash Receipts Q It is the owner’s interest in the business.

18 Cash Payments R Are monies owed either over a short or long term period to other businesses, institutions or persons other than the owner.

19 Subsidiary Journal S All monies received or to be received by the business.

20 Accounting Equation T These are costs that involved directly or indirectly in operating the business.

1 2 3 4 5 6 7 8 9 10

11 12 13 14 15 16 17 18 19 20

3

DOCUMENTS USED TO RECORD CASH TRANSACTIONS

ACTIVITY 2

RECEIPT

TRANSACTION 1

1. Use the following information to complete receipt no. 001. This is for capital contribution by the owner. INFORMATION Thembi Mali established a service business trading as Thembi Stores. She made an initial capital contribution of R900 000 on 1 March 2014. She wrote out a personal cheque, which was received by you, the financial officer.

RECEIPT 001 ……………….20…. Received from …………………………………………. the sum of ……………………………………………………………………. R For ……………………………………………………………………………. ………………………… for Thembi Stores

2. List all the details to be found on a receipt.

4

DEPOSIT SLIP

OPENING A CURRENT ACCOUNT

For businesses to operate a current account (cheque account) is opened at a commercial bank. The bank will charge certain fees such as service fees, cash handling fees, duty on debit orders, credit card levy, fee deposit for cheque books and deposit books. These charges are known as Bank charges. The amount received from the owner must be deposited into the current account. Make the necessary entries into the deposit slip.

TRANSACTION 2

On 1 March 2014 deposited the monies received, R900 000 from owner, Thembi Mali into Rand Bank. The account number is 3456789012. The reference is TM001CAPITAL

RAND BANK DEPOSIT SLIP Date: (YY-MM-DD) ____________________

Deposited to ______________________________

Account number Note

Coins

Telephone no. including dialling code

Postal Money orders

Total cash Signature Cheques deposited (Drawer’s name)

Depositor’s name or reference. These details will appear on the account holder’s/beneficiary’s statement

1 2 3

4 CONDITIONS Cheques etc. handed for collection will only be available as cash when paid. While acting in good faith and exercising reasonable care the Bank will not be responsible for ensuring that the depositor’s cheque is lawful. Ensure that the account number is correctly filled. The Bank will not be held responsible for incorrect information

Total cheques

Total R

5

CHEQUE

TRANSACTION 3

3.1 Use the information in the above transaction to complete the cheque and its counterfoil. INFORMATION 1 March 2014 Issued cheque no. 001 to the Joburg City for trading licence, R1 400.

______________20__ TO __________________ ___________________ FOR _________________ __________________ R

11-22-33-44 Rand Bank South Branch Date ____________________20____ Pay _________________________________________ or Bearer R__________________________________________________ ______________________________________ ___________________ Thembi Stores

001 3456789012

3.2.1 What is the name given to that part of the cheque which remains in the cheque book?

3.2.2 Identify the three parties to the cheque you have completed in question 1

Drawer

Drawee

Payee

3.2.3 List all the details found on a cheque

6

ACTIVITY 3

RECORDING OF TRANSACTIONS

• The accounting equation is. Assets = Owners Equity + Liabilities

• The double entry principle is that for every debit entry there has to be a credit entry

Complete the classification of Accounts. Fill in as many of the accounts you remember.

ASSETS = OWNERS EQUITY + LIABILITIES Increases (+) with a debit entry Decreases (-) with a credit entry

Increases (+) with a credit entry Decreases (-) with a debit entry

Increases (+) with a credit entry Decreases (-) with a debit entry

NON-CURRENT ASSETS FIXED ASSETS FINANCIAL ASSETS

OWNERS EQUITY NON-CURRENT LIABILITIES

CURRENT ASSETS

INCOME

CURRENT LIABILITIES

EXPENSES

7

TRANSACTIONS, DOUBLE ENTRY PRINCIPLE AND ACCOUNTING EQUATIONS ACTIVITY 4 The business is known as the Thembi Stores, trading in beaded jewellery. The financial year starts on 1 March each year and ends on 28 February. RECORDING OF CAPITAL CONTRIBUTION 1 March 2014 The owner, Thembi Mali deposited R900 000 into the business current account. Issued receipt no. 001.

CASH RECEIPTS JOURNAL OF THEMBI STORES – MARCH 2014 CRJ1 Doc No

D Details F

Analysis Of receipts

Bank

Sundry Accounts

Amount F Details

GENERAL LEDGER OF THEMBI STORES

BALANCE SHEET ACCOUNTS SECTION

DR CAPITAL B1 CR

EFFECT ON THE ACCOUNTING EQUATION Source document Account Debit Account credit A = OE + L

PAYMENT OF TRADING LICENCE 1 March 2014 Issued cheque no. 001 to the Joburg City for trading licence, R1 400. CASH PAYMENTS JOURNAL OF THEMBI STORES – MARCH 2014 CPJ1

Doc No

D Details F

Bank

Sundry Accounts

Amount F Details


NOMINAL ACCOUNTS SECTION

DR LICENCE N3 CR


8

CASH PURCHASES OF LAND AND BUILDING 3 March 2014 Paid Fay Properties, R500 000 by cheque no. 002 for land and building purchased.

CASH PAYMENTS JOURNAL OF THEMBI STORES – MARCH 2014 CPJ1 Doc No

D Details F

Bank

Sundry Accounts

Amount F Details



DR LAND AND BUILDING B3 CR


CASH PURCHASES OF TANGIBLE ASSETS (FIXED ASSETS) 4 March 2014 Purchased a cash register, R3 500 and a computer, R8 420 from Andile Traders and paid by cheque 003.


D Details F

Bank

Sundry Accounts

Amount F Details



DR EQUIPMENT B4 CR


9

CASH PURCHASES OF TRADING STOCK 4 March 2014 Thembi Stores purchased trading stock from Uxolo Wholesalers, R15 500. Cheque no. 004 was issued.


D Details F

Bank

Sundry Accounts

Amount F Details



DR TRADING STOCK B5 CR


CASH PURCHASES OF AN EXPENSE (e.g. Stationery) 8 March 2014 Purchased stationery from Vallei Stationers and paid by cheque 005, R400


D Details F

Bank Stationery

Sundry Accounts

Amount F Details



DR STATIONERY N6 CR

EFFECT ON THE ACCOUNTING EQUATION

Source document Account Debit Account credit A = OE + L

10

CASH SALES OF TRADING STOCK Calculating Cost of Sales and Sales: Cost of sales is always equal to 100%. The mark-up percentage represents how much more the item will be sold at. Sales is equal to the cost price plus the mark-up percentage. Sales is therefore calculated as follows: e.g. the cost price of a Chain is R80 and the mark-up percentage is 25%.

Cost of Sales is calculated as follows: e.g. The Sale price of a Beaded Bag is R240 and the mark-up percentage is 50%.

Calculate the missing figures in the table below

No Cost Price Profit Mark Up (%)

Selling Price

CALCULATIONS

1 R6 000 R9 000

2 R6 000 150

3 80 R3 600

4 20 R45 000

5 R18 000 33⅓

6 R2 500 R7 500

7 R168 16

8 R1 400 R1 680

9 R160 R192

10 66⅔ R15 000 NOTE:

33⅓ = 133⅓

100=

400

3 ÷

100

1=

400

3𝑋

1

100=

400

300=

4

3 𝑡𝑜 𝑐𝑎𝑙𝑐𝑢𝑙𝑎𝑡𝑒 𝑆𝑎𝑙𝑒𝑠 𝑎𝑛𝑑

3

4 𝑓𝑜𝑟 𝐶𝑜𝑠𝑡 𝑜𝑓 𝑆𝑎𝑙𝑒𝑠

66⅔ = 166⅔

100=

500

3 ÷

100

1=

500

3𝑋

1

100=

500

300=

5

3 𝑡𝑜 𝑐𝑎𝑙𝑐𝑢𝑙𝑎𝑡𝑒 𝑆𝑎𝑙𝑒𝑠 𝑎𝑛𝑑

3

5 𝑓𝑜𝑟 𝐶𝑜𝑠𝑡 𝑜𝑓 𝑆𝑎𝑙𝑒𝑠

11

9 March 2014 Cash sales of goods, R6 000, as per CRT 01. Goods are sold at a mark-up of 20%.

CASH RECEIPTS JOURNAL OF THEMBI STORES – MARCH 2014 CRJ1 Doc No

D Details F


Bank

Sales

Cost Of Sales




2014 Mar

31

Bank

CPJ1

15 500


DR SALES N1 CR

DR COST OF SALES N2 CR



12

PAYMENT OF WAGES 12 March 2014 Paid wages by cheque no. 006, R1 800.


D Details F

Bank Wages

Sundry Accounts

Amount F Details



DR WAGES N5 CR


OWNER WITHDRAWS CASH FOR PERSONAL USE 17 March 2014 Owner Thembi Mali, drew cheque no. 007, R700 for personal use


D Details F

Bank

Sundry Accounts

Amount F Details



DR DRAWINGS B2 CR


13

RECORDING OF RENT INCOME 25 March 2014 Received rent from tenant Koko Florist, R5 200. Issued receipt no. 002 CASH RECEIPTS JOURNAL OF THEMBI STORES – MARCH 2014 CRJ1

Doc No

D Details F


Bank

Sundry Accounts

Amount F Details



DR RENT INCOME N4 CR



PAYMENT OF SALARIES 30 March 2014 Paid the manager G Getit his salary,R7 200. Issued cheque no. 008.


D Details F

Bank

Sundry Accounts

Amount F Details



DR SALARIES N7 CR


The completed journal CASH RECEIPTS JOURNAL OF THEMBI STORES – MARCH 2014 CRJ1

Doc No

D Details F


Bank

Sales Cost of Sales

Sundry Accounts

Amount F Details

CASH PAYMENTS JOURNAL OF THEMBI STORES – MARCH 2014 CPJ1

Doc No

D Details F

Bank Trading Stock

Wages Stationery

Sundry Accounts

Amount F Details

BANK ACCOUNT From: The CRJ Thembi Stores will have deposited R918 600 into their current account. From: The CPJ Thembi Stores will have made cheques for the total amount of R543 920. This amount will have decreased their current account. Therefore their Bank Account will have R911 200 – R538 920 = R372 280. This is shown as follows in the General Ledger:



DR BANK B5 CR

16

TRIAL BALANCE

• A trail balance is drawn up to validate the entering of the transactions and the posting to the general ledger.

• The totals are taken from the general ledger after the accounts are balanced or total.

• Only balance sheet accounts are balanced

THEMBI STORES TRIAL BALANCE ON 31 MARCH 2014

Balance sheet account section F DEBIT CREDIT

Nominal accounts section

ACTIVITY 5 – TRADING BUSINESS

Hulley Traders sells their products at a mark-up of 25% on cost price.

REQUIRED:

Record the following transactions in the Cash Receipts Journal and Cash Payments Journal

TRANSACTIONS

JANUARY 2015

1 The owner, J. Hulley, deposited R600 000 into the current banking account. Issued receipt no. 51

4 Purchased a Desk and Laptop form MM Designers and paid by cheque no. 161, R18 000.

7 Purchased Trading Stock from Mandla Stores for R14 000 less 10% trade discount and paid by cheque no.162

10 Sold goods as per CRT1for cash R16 800

13 Cash cheque no. 163 to pay wages, R2 800

Purchased packing material for R400 from Eveline Papers and paid by cheque no. 164

16 Purchased a new vehicle from Evan Motors and paid by cheque no.165, R340 000

19 Issued cheque no.166 to Telkom to pay the telephone for the business R650 and the owner, R840.

22 Cash cheque no.167 to pay wages, R2 800

Purchased Trading Stock from Mandla Stores for R24 000.. Issued cheque no.168

Paid for SS Fast Traders by cheque no. 169 for transportation of trading stock R6 000

25 Received cash as per CRT2 for trading stock sold, R32 000

Received a cheque from Winnie Gifts for rent for the month, R12 000. Issued receipt no. 52

31 Issued cheque no. 170 to pay Joburg City for electricity R2 400

Paid the salary of the manager, J Matata, R15 000, cheque no.171 was issued.

CASH RECEIPTS JOURNAL OF HULLEY TRADERS – JANUARY 2015 CRJ1 Doc No

D Details F


Bank

Sales Cost of Sales

Sundry Accounts

Amount F Details

CASH PAYMENTS JOURNAL OF HULLEY TRADERS – JANUARY 2015 CPJ1

Doc No

D Details F

Bank Trading Stock

Wages Packing Material

Sundry Accounts

Amount F Details

ACTIVITY 6

GENERAL LEDGER

The Cash Receipts and Cash Payments Journal of GP Traders are given below. The business sells Trading Stock at 50% on Cost of Sales.

REQUIRED:

Post to the following accounts in the General Ledger. The balances for 1 January 2015 are given within brackets

7.1 Capital (R280 000)

7.2 Drawings (R16 800)

7.3 Trading stock (R42 000)

7.4 Bank (R54 400)

7.5 Sales (R180 000)

7.6 Cost of Sales (R120 000)

7.7 Electricity (R3 240)

7.8 Salaries (R96 000)

7.9 Rent Income (R90 000)

INFORMATION:

CASH RECEIPTS JOURNAL OF GP TRADERS – JANUARY 2015 CPJ1

Doc No

D Details F

Analysis of

Receipts Bank Sales

Cost of Sales

Sundry Accounts

Amount F Details

CRT 3 Sales 42 000 42 000 42 000

521 8 GP Pro 280 000 280 000 280 000 Capital

CRT 16 Sales 49 200 49 200 49 200

CRT 27 Sales 24 000 24 000

524 Red Dot 15 000 39 000 15 000 Rent income

410 200 115 200 ? 295 000

CASH PAYMENTS JOURNAL OF GP TRADERS – JANUARY 2015 CPJ1

Doc No

D Details F

Bank Trading Stock


Sundry Accounts

Amount F Details

880 5 Cash 8 000 8 000

882 12 JW Traders 28 000 28 000

883 SS Freight 9 600 9 600

884 14 Cash 8 000 8 000

885 24 Eskom 6 100 2 500 Electricity

3 600 Drawings

886 29 JS Motors 320 000 320 000 Vehicles

887 30 JN Eddep 16 000 16 000 Salary

JE Stores 840 840

396 540 37 600 16 000 840 342 100

20

ACTIVITY 6 GENERAL LEDGER OF GP TRADERS


DR CAPITAL B1 CR

DR DRAWINGS B2 CR


DR BANK B4 CR

21


DR SALES N1 CR


DR ELECTRICITY N3 CR

DR SALARIES N4 CR


22

ACTIVITY 7

Busi Traders sells their products at a mark-up of 50% on cost price.

REQUIRED:

7.1 Record the following transactions in the Cash Receipts Journal and Cash Payments Journal

7.2 Post to the General Ledger.;

INFORMATION

The Balances on 1 March 2015 is as follows

Capital R480 500 Sales R510 000

Drawings R 12 000 Cost of Sales R340 000

Vehicles R320 000 Rent Income R108 000

Equipment R 48 000 Wages R 81 000

Trading Stock R 82 000 Stationery R 8 200

Bank R 28 000 Telephone R 18 500

Packing Material R 10 800

Salaries R150 000

TRANSACTIONS: MARCH 2015

1 The owner, Busi Komeni deposited R200 000 as additional capital in the bank account. Issued Receipt 200

2 Purchases trading stock from MM Stores for R39 000 as per cheque 400

Purchases equipment to the amount of R12 000 from SS Fitters as per cheque 401

4 Cash sales R45 000 as per CRT 300

6 Paid wages per cheque 402, R9 000

7 Purchase trading stock from TT Traders for R25 000. Paid by cheque 403

8 Donated R10 000 to the local orphanage, Care Love, as per cheque 404

10 Purchase stationery for cash, R400 from SS Writers. Issued cheque 405

13 Received rent from Pet Owners, R12 000. Issued receipt 201

17 Cash Sales as per CRT 301, R37 500

19 Paid wages, R9 000 as per cheque 406

21 Owner B Komeni drew cheque 407 for person use, R6 000

23 Sold goods to Oliver as per credit card, R12 000. CRT 302 was issued.

26 Paid New Repairs, R18 200 for vehicle repairs. Issued cheque 408.

28 Paid Telkom as per cheque 409 for the telephone, R1 300

30 Paid M Dali R15 000 her salary as per cheque 410

Purchase packing material from XY Packers per cheque 411, R600

CASH RECEIPTS JOURNAL OF BUSI TRADERS – MARCH 2015 CRJ3 Doc No

D Details F


Bank

Sales Cost of Sales

Sundry Accounts

Amount F Details

CASH PAYMENTS JOURNAL OF BUSI TRADERS – MARCH 2015 CPJ3

Doc No

D Details F

Bank Trading Stock


Sundry Accounts

Amount F Details

GENERAL LEDGER OF BUSI TRADERS BALANCE SHEET ACCOUNTS SECTION DR CAPITAL B1 CR

DR DRAWINGS B2 CR

DR VEHICLES B3 CR

DR EQUIPMENT B4 CR


DR BANK B6 CR

NOMINAL ACCOUNTS SECTION DR SALES N1 CR


25


DR WAGES N4 CR

DR STATIONERY N5 CR

DR TELEPHONE N6 CR

DR PACKING MATERIAL N7 CR

DR SALARIES N8 CR

DR DONATIONS N9 CR

DR VEHICLE EXPENSES N10 CR

26

MODULE 4

FINANCIAL LITERACY: CREDIT TRANSACTIONS - DEBTORS

RECORDING CREDIT SALES OF TRADING STOCK

Goods are sold on credit to creditworthy customers. These customers are usually given a period of time to pay the money owing to the business. Any person owning money to a business is called a DEBTOR. The source document used to record goods sold on credit is called an INVOICE. The following is an example of an invoice.

ACTIVITY 1

INVOICE No. 455

24 School Street Cravenby

7493 2 March 2014

To: DL Themba 121 Rissik Street Parow East 7501 Bought from: AK TRADERS

QUANTITY DESCRIPTION PRICE AMOUNT

2 Dresses R445 910

5 Skirts R125 625

1 535

E. & O.E.

QUESTIONS

1.

Someone that owes the business money is called ___________________________

2.

The business records the transaction from (original / duplicate) sales invoice.

3.

What does E. & O.E. stand for? _________________________________________

4. List the details found on an invoice

27

ACTIVITY 2 – WORK WITH ACTIVITY

REQUIRED

Complete the answer sheets below.

TRANSACTION: JANUARY 2015

7 Sold goods on credit to J Keith, R4 500 (mark-up percentage - 20%). Issued invoice 001.

13 Issued invoice 002 to R Sizwe for goods, R8 400.

14 Received cheque from J Keith to settle her account. Issued receipt 004

19 Sold goods for cash to J Keith R30 000.

28 R Sizwe paid R5 300 as part payment. Issued receipt 005.

30 J Keith purchased goods to the value of R18 000

CASH RECEIPTS JOURNAL OF AK TRADERS FOR JANUARY 2014 CRJ1

Doc No

Details F Analysis of receipts

Bank Sales Cost of Sales

Debtors Control

DEBTORS JOURNAL OF AK TRADERS FOR JANUARY 2015 DJ 1

Doc No D DETAILS F SALES COST OF SALES

DEBTORS LEDGER OF AK TRADERS

J KEITH D1 DATE DETAILS F DEBIT CREDIT BALANCE

R SIZWE D2

EFFECT ON THE ACCOUNTING EQUATION FOR 7 and 14 JANUARY 2015

Source document

Account Debit

Account credit A = OE + L

NETT EFFECT (PROFIT)

28

GENERAL LEDGER OF AK TRADERS BALANCE SHEET ACCOUNTS SECTION DR TRADING STOCK B5 CR 2015 Jan

1

Balance

b/d

36 000

31

Bank

CPJ1

54 000

Balance

c/d

90 000

90 000

2015 Feb

1

Balance

b/d

DR DEBTORS CONTROL B6 CR


DR SALES N1 CR 2015

Jan 1

Balance

b/d

180 000

DR COST OF SALES N2 CR 2015 Jan

1

Balance

b/d

150 000

DEBTORS LIST

DEBTORS Fol DEBIT CREDIT

29

NOTE: POSTING FROM DJ TO GENERAL LEDGER Sales – Dr Debtors Control; Cr. Sales Cost of Sales – Dr Cost of Sales; Cr Trading Stock

ACTIVITY 3

Pabablo Tsedi owns PT Traders, that buys and sells accessories. Goods are sold at a profit mark up of 20% on cost price.

REQUIRED:

1. Record the following transactions in the Debtors and Cash Receipts Journals. Cast (close off) the journals at the end of the month

2. Post to the following accounts in the General Ledger. Balance/total the accounts at the end of the month. ▪ Trading stock ▪ Debtors’ control ▪ Sales ▪ Cost of sales ▪ Rent Income

3. Post to the Debtors Ledger.

4. Complete the Debtors’ List

INFORMATION

1. Balances on 1 March 2015

GENERAL LEDGER DEBTORS LEDGER

Capital R550 000

O Chand R8 900

Trading stock R 38 400 G Mashaba R3 340

Debtors control R 12 240

Sales R403 200

Cost of sales R336 000

2. Transactions – March 2015

5 Sold goods on credit to O Chand, R3 840. Issued invoice 001.

11 Issued invoice 002 to G Mashaba for goods sold to her, R5 040.

12 Received cheque from G Mashaba to settle her account as on 1 March 2015. Issued receipt 004

19 The owner increased her capital to R150 000.

21 Sold goods for cash to O Chand, R9 600

29 O Chand paid R5 600 in part payment of her account.

Received a cheque from K Kay for office space let to him for the month. The annual rental amounts to R144 000

31 G Mashaba purchased goods to the value of R4 320 on credit.

CASH RECEIPTS JOURNAL OF PT TRADERS – MARCH 2015 CRJ3 Doc No

D Details F


Bank

Sales Cost of Sales

Debtors Control

Sundry Accounts

Amount F Details

DEBTORS JOURNAL OF PTTRADERS FOR MARCH 2015 DJ 1


DEBTORS LEDGER OF PT TRADERS

O CHAND D1 DATE DETAILS F DEBIT CREDIT BALANCE

G MASHABA D2

GENERAL LEDGER OF PT TRADERS BALANCE SHEET ACCOUNTS SECTION DR CAPITAL B1 CR






DEBTORS LIST


32

MODULE 8

FINANCIAL LITERACY: CREDIT TRANSACTIONS - DEBTORS

ACTIVITY 1

Phindi Nsedi owns Buzz Traders. Goods are sold at a profit mark up of 50% on cost price.

REQUIRED:

1. Record the following transactions in the Debtors and Cash Receipts Journals. Cast (close off) the journals at the end of the month

2. Post to the following accounts in the General Ledger. Balance/total the accounts at the end of the month. ▪ Capital ▪ Trading stock ▪ Debtors’ control ▪ Sales ▪ Cost of sales ▪ Rent Income

3. Post to the Debtors Ledger.

4. Complete the Debtors’ List

INFORMATION

1. Balances on 1 July 2015

GENERAL LEDGER DEBTORS LEDGER

Capital R700 000

J Jabu R17 800

Trading stock R 76 800 J Ned R 6 680

Debtors control R 24 480

Sales R630 000

Cost of sales R420 000

2. Transactions – July 2015

5 Sold goods on credit to J Jabu, R7 680. Issued invoice 21.

11 Issued invoice 22 to J Ned for goods sold to her, R10 080.

12 Received cheque from J Ned to settle her account as on 1 March 2015. Issued receipt 34

19 The owner increased her capital to R100 000. Issued receipt 35

21 Sold goods for cash to J Jabu, R19 200. Issued cash sales slip.

29 J Jabu paid R11 200 in part payment of her account. Issued receipt 36

Received a cheque, R15 000 from MM Coffee Shop for office space let for the month. Issued receipt 37

31 J Ned purchased goods to the value of R8 640 on credit.

.

CASH RECEIPTS JOURNAL OF BUZZ TRADERS – JULY 2015 CRJ7 Doc No

D Details F


Bank

Sales Cost of Sales

Debtors Control

Sundry Accounts

Amount F Details

DEBTORS JOURNAL OF BUZZ TRADERS FOR JULY 2015 DJ7


DEBTORS LEDGER OF BUZZ TRADERS

J Jabu D1 DATE DETAILS F DEBIT CREDIT BALANCE

J Ned D2

GENERAL LEDGER OF BUZZ TRADERS BALANCE SHEET ACCOUNTS SECTION DR CAPITAL B1 CR






DEBTORS LIST JULY 2015


35

FINANCIAL LITERACY: CREDIT TRANSACTIONS - CREDITORS

RECORDING CREDIT PURCHASES

The business sometimes purchases goods on credit from the supplier. The supplier will issue an invoice to the business. The supplier is known as the CREDITOR. A Creditor is someone that the business owes money to

ACTIVITY 2

INVOICE No. 567

18 Inland Street Parow, 7560

6 March 2014 To: AK TRADERS 24 School Street Cravenby, 77493 Bought from: MODERN FASHIONS


15 Shirts R80 1 200

10 Skirts R75 750

1 950

E. & O.E.

QUESTIONS

2.1 Someone that the business owes money to is called ______________________

2.2 The business records the transaction from (original / duplicate) purchases invoice.

2.3 What does E. & O.E. stand for? _______________________________

2.4 What is the difference between a sales and a purchases invoice?

2.5 List the details found on an invoice

36

ACTIVITY 3 – WORK WITH REQUIRED: Complete the answer sheets are reflected below. TRANSACTION JANUARY 2015 3 Purchased Trading stock, R24 000 on credit from Vries Stores. Received invoice A533

(renumbered 001). 8 Received invoice 908 from Zens Traders for packing material, R1 200.

11 Purchase trading stock from Vries Stores R54 000 and paid by cheque 56

14 Purchased Equipment from Digital Magic on credit for R8 900.

17 Paid Vries Stores R12 000 as part payment of account. Issued cheque no 57

21 Received invoice from Vries Stores for trading stock purchased, R15 000

Fast Freight issued invoice B445 for transportation of trading stock R1 500

24 Paid Telkom for the telephone account by cheque 58, R900

28 Purchased Stationery on credit from Zen Traders, R200.

30 Settle account of Zens Traders. Issued cheque no 59

31 Paid the manager, Toko Zak the salary for the month per cheque 60, R9 000.

CASH PAYMENTS JOURNAL OF AK TRADERS – JANUARY 2015 CPJ1 Doc No

D Details F

Bank Trading Stock

Creditors Control

Sundry Accounts

Amount F Details

CREDITORS JOURNAL OF AK TRADERS – JANUARY 2015 CJ1

Doc No

D Details F

Creditors Control

Trading Stock

Packing Material

Sundry Accounts

Amount F Details

37

CREDITORS LEDGER OF AK TRADERS

VRIES STORES C1

DATE DETAILS F DEBIT CREDIT BALANCE

ZEN TRADERS C2

DIGITAL MAGIC C3

FAST FREIGHT C4

GENERAL LEDGER OF AK TRADERS BALANCE SHEET ACCOUNTS SECTION DR EQUIPMENT B4 CR

DR TRADING STOCK B5 CR 2015 Jan

1

Balance

b/d

36 000

2015 Jan

31

Cost of Sales

CRJ1

25 000

31

Bank

CPJ1

Cost of Sales

DJ1

25 750

Balance

c/d

2015 Feb

1

Balance

b/d

DR CREDITORS CONTROL B7 CR

38

NOMINAL ACCOUNTS SECTION DR PACKING MATERIAL N6 CR 2015 Jan

31

Bank

CRJ1

2 000

DR STATIONERY N7 CR

DR TELEPHONE N8 CR

DR SALARIES N9 CR

CREDITORS LIST

CREDITORS Fol DEBIT CREDIT

EFFECT ON THE ACCOUNTING EQUATION FOR JANUARY 2015

Date Source document

Account Debit

Account credit A = OE + L

3

8

11

14

17

21

24

28

30

31

39

ACTIVITY 4

The following information was extracted from the accounting records of Hombie Dealers.

REQUIRED:

4.1 Record the following transactions in the Creditors and Cash Payments Journals. Cast (close off) the journals at the end of the month.

4.2 Post to the following accounts in the General Ledger. Balance/total the accounts at the end of the month. ▪ Trading stock ▪ Creditors control ▪ Consumable stores

4.3 Post to the Creditors Ledger.

INFORMATION

Balances/totals on 1 August 2015

General Ledger Creditors List on 1 August 2015

Trading Stock R12 200 Creditors’ Control R14 080 Consumable Stores R 890

Bizz Wholesalers R7 650 PAR Traders R6 430

TRANSACTION

AUGUST 2015

3 Purchased Trading stock, R6 200 on credit from Bizz Wholesalers. Received invoice A533 (renumbered 001).

6 Bought Consumable stores, R660 and Trading stock, R5 440 from Bizz Wholesalers and received 10% cash discount and paid by cheque no. 222

8 Received invoice 908 from PAR Traders for Consumable stores, R530.

10 Cashed a cheque to pay wages, R7 400

18 Paid Bizz Wholesalers, R3 400 by cheque as part payment of our account.

19 Issued cheque to PAR Traders to settle amount owing on 1 March 20.9

22 Purchased a new equipment on credit from Bizz Wholesalers for R12 375 subject to a trade discount of 331/3 %.

27 Bought the following on credit from PAR Traders: Stationery, R540 Consumable stores, R380.

30 Paid Electricity by cheque to Eskom, R1 650

CASH PAYMENTS JOURNAL OF HOMBIE TRADERS FOR AUGUST 2015 CPJ 8

Doc No.

D

DETAILS

F

Bank

Trading Stock

Consumable Stores

Creditors Control

Sundry Accounts

Amount F Details

CREDITORS JOURNAL OF HOMBIE TRADERS FOR AUGUST 2015 CJ 8

Doc No.

D

DETAILS

F

Creditors Control

Trading Stock

Consumable Stores

Sundry Accounts

Amount F Details

GENERAL LEDGER OF HOMBIE TRADERS BALANCE SHEET ACCOUNTS SECTION DR TRADING STOCK B5 CR 2015

Aug 31

Cost of Sales

CRJ8

4 800

Debtors Control DJ 1 200

DR CREDITORS CONTROL B7 CR

NOMINAL ACCOUNTS SECTION DR CONSUMABLE STORES N6 CR

CREDITORS LEDGER OF HOMBIE TRADERS

BIZZ WHOLESALERS C1

DATE DETAILS F DEBIT CREDIT BALANCE

PAR TRADERS C2

42

MODULE 10

FINANCIAL LITERACY: CASH AND CREDIT TRANSACTIONS

ACTIVITY 1 REQUIRED: Prepare the following from the transactions which was extracted from the books of Red Ochre Traders for January 2014 1. The CRJ, CPJ, DJ and CJ January 2014. 2. Post to the account of V Violet in the Debtors ledger. 3. Post to Monet Traders in the Creditors ledger. NOTE: Goods are sold at 20% on cost price. Transactions JANUARY 2014 1 R Ochre increased his capital contribution to the business, R50 000. Issued receipt no.

300 2 Cash sales as per CRT 200, R8 400. 3 Sold merchandise on credit to V Violet and issued invoice no. 400, R600 7 Paid Lorikeet Trades by cheque 501 in settlement as at 1 January 2015, R500. 8 Sold goods on credit to C Crimson, R1 200 (invoice 401) 9 Bought consumable stores on credit invoice no 901 (renumbered 400) from Monet

Traders, R230. 12 Cash sales as per CRT 201, R9 000. Issued receipt 301 to G Green for part settlement of his account, R800 15 Purchased goods from Parakeet LTD on credit and received invoice 445, R12 500. 16 Drew cash cheque 502 to pay wages, R2 500. 19 Received a cheque from V Violet to settle his account, issued receipt no 302 for R600

Purchased trading stock from Macaw Traders, as per cheque 503, R17 200. 21 Received rent from tenant P Pink for premises sub-let, R4 500. Issued receipt 303. 24 Purchased the following from Monet on credit: Office equipment, R18 000 Merchandise, R 9 400 Stationery, R555, Received invoice no. 786 25 Sold merchandise on credit to V Violet, R1 800. Issued invoice no 402. Paid Telkom for the telephone amount for the month. Issued cheque no.504, R990. 27 Cash sales as per CRT 202, R4 800 29 Purchased stationery from Rosella Stationers and paid by cheque 505, R1 600. 30 Cash cheque no 506 to pay wages, R2 500. 31 Owner, R Ochre drew cheque 507 for personal use, R3 400

Purchased merchandise on credit from Parrot Wholesalers and received invoice 333, R 1 400.

Paid salary to B Sienna by cheque 508, R6 800 Sent cheque no. 509 to Monet Traders as part settlement of account, R20 720

ACTIVITY 1 CASH RECEIPTS JOURNAL OF RED OCHRE TRADERS FOR JANUARY 2014 CRJ1

Doc. No.

D

DETAILS

F

Analysis Of

Receipts

Bank

Sales Cost Of

Sales

Debtors control

Sundry Accounts

Amount F Details

CASH PAYMENTS JOURNAL OF RED OCHRE TRADERS FOR JANUARY 2014 CPJ 1

Doc No.

D

DETAILS

F

Bank

Trading Stock

Wages

Stationery Creditors Control

Sundry Accounts

Amount F Details

44

DEBTORS JOURNAL OF RED OCHRE TRADERS FOR JANUARY 2014 DJ1

Doc. No.

D

DETAILS

F

SALES COST OF SALES

CREDITORS JOURNAL OF RED OCHRE TRADERS FOR JANUARY 2014 CJ1 Doc. No.

D

DETAILS

F

CREDITORS CONTROL

TRADING STOCK

STATIONERY EQUIPMENT Sundry Accounts

Amount F Details

DEBTORS LEDGER OF RED OCHRE TRADERS

V VIOLET

DATE DETAILS FOL DEBIT CREDIT BALANCE

CREDITORS LEDGER OF RED OCHRE TRADERS

MONET TRADERS


ACCOUNTING EQUATION ACTIVITY 2 Complete the columns in connection with the transactions of Glitter Gold Jewels under the headings and according to the example completed on the special answer sheet. Goods are sold at a mark-up of 25% on cost of sales. NOTES 1. Assume that the bank balances is favourable at all times. 2. The firm uses a system of perpetual (continuous) inventory. 3 Under the headings “Assets, Owners Equity and Liabilities”, you must indicate with what amount each will increase (+) or decrease (-). Show “0” for no change. 4 In respect of more than one entry for a transaction, also show the net effect on all the entries. EXAMPLE Sold goods for cash as per CRT, R600 (cost of Sales, R480)

ACCOUNT DEBIT ACCOUNT CREDIT AMOUNT EFFECT ON EQUATION

A OE L

Bank Sales 600 + + 0

Cost of sales Trading stock 480 - - 0

TRANSACTIONS: 1. Purchased goods on credit from Red Square Traders for R4 500. 2. Issued a cheque to Brown Speed Transport for carriage on merchandise purchased,

R1 345 3 The proprietor, R Raggs, increased his capital contribution in the business by depositing

a further R20 000 in the bank. 4.

No. 080 7 March 2014 To: Pen Stationers For: Stationery

Previous balance

Deposit’s

Total

This cheque 400 00

Total

Debits

Balance

5.

GLITTER GOLD JEWEL 09/03/2014 Bracelet R125,00 Earrings R 75,00 Pearl chain R350,00 Total R550,00 Received R550,00 Change R 0,00

46

6.

INVOICE No. 051

24 School Street Cravenby

7493 12 March 2014

To: DL Themba 121 Rissik Street Parow East 7501 Bought from: GLITTER GOLD JEWEL


2 Beaded chains R445 910

5 Pair of earnings – Red velvet R125/pair 625

1 535

E. & O.E.

7. 8.

No. 081 21 March 2014 To: Gold Traders For: Trading Stock

Previous balance

Deposit’s

Total

This cheque 16 200 00

Total

Debits

Balance

No. 082 28 March 2014 To: R Raggs For: Telephone

Previous balance

Deposit’s

Total

This cheque 750 00

Total

Debits

Balance

9. Received a cheque from B Blue, a debtor, in full settlement of his account of R800 10. Issued a cheque to Reality Ltd for R2 800 in settlement of account of R3 000.

NO ACCOUNT DEBIT ACCOUNT CREDIT AMOUNT R

EFFECT ON EQUATION

A = OE +

L

1

2

3

4

5

6

7

8

9

10

47

POSTING TO THE GENERAL LEDGER ACTIVITY 3 Post to the following ledger accounts 1. Trading Stock Account (Balance, R7 000) 2. Debtors Control Account (Balance, R4 500) 3. Bank (Balance, R23 456 – Dr) 4. Creditors Control Account (Balance R6 200) 5. Sales (Balance, 48 000) 6. Cost of Sales (Balance, R36 000) 7. Stationery account (Balance, R900) The following is an extract from the subsidiary journals of Bluebells Stores for March 2014 CASH RECEIPTS JOURNAL CRJ3

BANK SALES COST OF

SALES Debtors Control

SUNDRY ACCOUNT

14 608 4 800 3 600 8 160 1 648

CASH PAYMENTS JOURNAL CPJ3

BANK TRADING STOCK

STATIONERY Creditors Control

SUNDRY ACCOUNT

12 000 2 100 700 3 610 5 590

DEBTORS JOURNAL DJ 3

SALES COST OF SALES

13 800 11 200

CREDITORS JOURNAL CJ3

CREDITOR CONTROL

TRADING STOCK

EQUIPMENT STATIONERY SUNDRY

ACCOUNT

16 882 8 600 4 000 400 3 882

48

POSTING TO THE GENERAL LEDGER ACTIVITY 3

GENERAL LEDGER OF BLUEBELLS STORES


Dr TRADING STOCK B8 Cr Date Details F Amount Date Details F Amount

Dr DEBTORS CONTROL B9 Cr Date Details F Amount Date Details F Amount

Dr BANK B10 Cr Date Details F Amount Date Details F Amount

Dr CREDITORS CONTROL B2 Cr Date Details F Amount Date Details F Amount

49


Dr SALES N1 Cr Date Details F Amount Date Details F Amount

Dr COST OF SALES N2 Cr Date Details F Amount Date Details F Amount

Dr STATIONERY N3 Cr Date Details F Amount Date Details F Amount

50

ACTIVITY 4 Bundu Café, owner D Dudu, is a trading business which has a profit mark-up of 25% on cost. REQUIRED 1 Record the following transactions for May 2014 in the subsidiary journals and cast the

journals. Transactions: May 2014. 1 D Dudu, the owner, increased his capital contribution from R50 000 to R200 000 by

paying in a personal cheque to the cashier; receipt 216 was issued to him. 2 Purchased goods from Grand Traders per invoice (renumbered 356), R4 900. 3 Purchased second hand delivery vehicle cash from BM Motors; cheque 4023, R120 000. 6 Issued invoices for merchandise sold: No. 451 to M Makeba, R480, No. 452 to Smart, R760 7 Sold goods to J Julian for R1 780; accepted credit card payment. Received M Valley’s cheque for R480 in payment of her debt R505; issued receipt 217. 10 Issued cheque 4024 for R810 to Bar One Traders in payment of the firm’s debt. 11 Purchased merchandise from Bush suppliers for R2 300; issued cheque 4025 to them in

payment of merchandise and delivery, R300 12 Received invoices for purchases on credit Cloudy Traders, for merchandise, R2 400, Pen Stationers, for stationery, R360 19 Cash cheque 4026 in payment of the following: Telephone (the firm), R496, Telephone (D Dudu), R245 23 Cash sales of merchandise, R3 690

Received rent for April R1 500 from lessee J Jingle; issued receipt 218. 26 Received deed of transfer of property purchased from SDF Properties for R320 000;

paid 20% of the purchase price per cheque 4027. The rest is on credit. 28 Received invoice from SA Packers for R520 for packing material. 30 Paid A Andy’s salary by cheque 4028, R4 700 31 Purchased equipment from Metal Works LTD, R6 800. Received invoice together with

equipment.

ACTIVITY 4 CASH RECEIPTS JOURNAL OF BUNDU CAFÉ FOR MAY 2014 CRJ5

Doc. No.

D

DETAILS

F

Analysis Of Receipts

Bank

Sales

Cost Of

Sales

Debtors control

Sundry Accounts

Amount F Details

CASH PAYMENTS JOURNAL OF BUNDU CAFÉ FOR MAY 2014 CPJ5

Doc No.

D

DETAILS

F

Bank

Trading Stock

Wages

Creditors Control

Sundry Accounts

Amount F Details

52

DEBTORS JOURNAL OF BUNDU CAFÉ FOR MAY 2014 DJ5 Doc. No.

D

DETAILS

F

SALES COST OF SALES

CREDITORS JOURNAL OF BUNDU CAFÉ FOR MAY 2014 CJ5

Doc. No.

D

DETAILS

F

CREDITORS CONTROL

TRADING STOCK

STATIONERY EQUIPMENT Sundry Accounts Amount F Details

ACTIVITY 9 Prepare the following from the transactions which was extracted from the books of Mickey Traders for May 2014

NOTE: Goods are sold at 25% on cost price. 1. Post to the Journals: CRJ,CPJ, DJ and CJ 2. Post to the following accounts in the Subsidiary Ledgers and draw up the debtors and

creditors list:

Debtors ledger Creditors ledger

M Minnie 4 000 Barney Traders 2 460

L Lulu 8 600 Telly Tubies 6 900

Queeny Traders 5 840

3 Post to the general ledger accounts Balances on the 1 May 2014

Balance sheet accounts section Nominal accounts section

Capital 600 000 Sales 960 000

Drawings 12 000 Cost of sales ?

Land and Building 400 000 Rent Income 150 000

Vehicles 300 000 Telephone 9 300

Equipment 40 000 Wages 122 000

Trading Stock 24 000 Stationery 950

Debtors Control ? Consumable stores 930

Bank (Dr) 35 420

Creditors control ?

4 Prepare the Trial Balance for 31 May 2014 Transactions May 2014 01 M Mickey increased his capital contribution by R80 000. Issued receipt 600 02 Sold merchandise on credit for R15 000 to M Minnie as per invoice 500. 07 Cash sales as per CRT 400, R8 000. 09 Bought consumable stores on credit, R450 from Barney Traders. (Number invoice 250) 12 Issued receipt 601 to L Lulu for part payment of her account, R3 500. 15 Purchased goods from Telly Tubies on credit and received invoice 586, R7 500. 16 Drew cash cheque 802 to pay wages, R12 200 19 Received a cheque from M Minnie to settle her account, R18 000. Issued receipt 602 Sent cheque 803 to Barney Traders as part settlement of our account, R2 000 21 Received rent from tenant P Panther, R15 000 for premises sublet. Issued receipt 603 Sold goods on credit to L Lulu, R8 400, as per invoice 50. 22 Cash sales as per CRT 401, R25 400 24 Purchased the following from Queeny Traders on credit: Received invoice 427 Equipment, R15 000; Merchandise, R34 200; Stationery, R855 25 Sold merchandise to M Minnie on credit as per invoice 502, R7 000 Paid Telkom by cheque 803, R2 840 29 Purchased Stationery from Goofy Stationers and paid by cheque 804, R455 30 Cash cheque 805 to pay wages, R12 200 Owner drew cheque 806, R2 900 for personal use. 31 Purchased merchandise from Teddy Bear Wholesalers and by cheque 807, R13 200. Paid Queeny Traders as part payment, R40 000. Issued cheque 808.

1. CASH RECEIPTS JOURNAL OF MICKEY TRADERS FOR MAY 2014 CRJ5

Doc. No.

D

DETAILS

F

Analysis Of

Receipts

Bank

Sales

Cost Of

Sales

Debtors Control

Sundry Accounts

Amount F Details

2. CASH PAYMENTS JOURNAL OF MICKEY TRADERS FOR MAY 2014 CPJ5

DDoc No.

D

DETAILS

F

Bank

Trading Stock

Wages

Stationery Creditors Control

Sundry Accounts

Amount F Details

55

3. DEBTORS JOURNAL OF MICKEY TRADERS FOR MAY 2014 DJ5 Doc. No.

D

DETAILS

F

SALES COST OF SALES

4. CREDITORS JOURNAL OF MICKEY TRADERS FOR MAY 2014 CJ5

Doc. No.

D

DETAILS

F

CREDITORS CONTROL

TRADING STOCK

STATIONERY EQUIPMENT Sundry Accounts

Amount F Details

5. DEBTORS LEDGER OF MICKEY TRADERS

M MINNIE D1


L LULU D2


DEBTORS LIST

R

CREDITORS LEDGER OF MICKEY TRADERS

BARNEY TRADERS C2


TELLY TUBIES C3


QUEENY TRADERS C5


57

CREDITORS LIST

R

6.

GENERAL LEDGER OF MICKEY TRADERS


Dr CAPITAL B1 Cr Date Details F Amount Date Details F Amount

Dr DRAWINGS B2 Cr Date Details F Amount Date Details F Amount

Dr LAND AND BUILDING B3 Cr Date Details F Amount Date Details F Amount

Dr VEHICLES B4 Cr Date Details F Amount Date Details F Amount

Dr EQUIPMENT B5 Cr Date Details F Amount Date Details F Amount

58

Dr TRADING STOCK B6 Cr Date Details F Amount Date Details F Amount

Dr DEBTORS CONTROL B7 Cr Date Details F Amount Date Details F Amount

Dr BANK B8 Cr Date Details F Amount Date Details F Amount

Dr CREDITORS CONTROL B9 Cr

Date Details F Amount Date Details F Amount

59


Dr SALES N1 Cr Date Details F Amount Date Details F Amount

Dr COST OF SALES N2 Cr Date Details F Amount Date Details F Amount

Dr RENT INCOME N3 Cr Date Details F Amount Date Details F Amount

Dr TELEPHONE N4 Cr Date Details F Amount Date Details F Amount

Dr WAGES N5 Cr Date Details F Amount Date Details F Amount

Dr STATIONERY N6 Cr Date Details F Amount Date Details F Amount

60

Dr CONSUMABLE STORES N7 Cr Date Details F Amount Date Details F Amount

TRIAL BALANCE OF MICKEY TRADERS ON 31 MAY 2014

Fol R R


Capital B1

Drawings B2

Land and Building B3

Vehicles B4

Equipment B5

Trading stock B6

Debtors control B7

Bank B8

Creditors control B9


Sales N1

Cost of sales N2

Rent Income N3

Telephone N4

Wages N5

Stationery N6

Consumable stores N7

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