Figure 21.1 : Purchases Cycle

To Supplier To Store

To Accounting Department

Figure 21.4 : Purchases Department

Received Purchase Requisition from

Departments

Purchase Requisition

Clerk prepares a pre-numbered Purchases

Order and obtains approval from officer.

Approved Suppliers Quotations

Purchase Requisition

PO 4

PO 3

PO 2

1

Purchase order(PO)

N

To Bin Card

To Accounts Department

Figure 21.5 : Stores-Receiving of Goods from Supplier

From Purchases Departme

nt

Received goods and delivery note from

supplier

Approved Purchase Order (PO) Delivery Note

Match documents

App PO 3

Delivery Note

Storekeeper checks the goods received

Storekeeper prepares pre-numbered receiving report and obtains approval from officer

App. SO 3

Receiving Rpt. 2

1

Receiving Report

N

Figure 20.16 : Accounts Department

From Purchase

Department

From Stores Received

purchase invoice from

supplier

2Purchase Order

2Delivery Note Purchase Invoice

Match Documents

Clerk obtains approval from

officer

Purchase Order

Receiving Rpt. 2

Purchase Invoice

N

Figure 21.7 : Journalising and Posting the Sales

Purchase Invoice

Bookkeeper records in Purchase Journal

Bookkeeper records in Purchase

Ledger

Purchase Journal

Purchase Ledger

N

To Cashier

Figure 21.8 : Approving payment vouchers.

NReceive Remittance

Advice from supplier

Purchase Invoice Remittance Advice

Match document

s

Prepare and obtain approval of Payment

Voucher

Purchase Invoice

Remittance Adv.

Payment Vouch. 3

Payment Vouch. 2

1

Payment Voucher

N

To Accounts Department

To Supplier

Figure 21.9 : Cashier-Approving Cheques

From Accounts

Department

Purchase Invoice

Remittance Adv.

Payment Vouch. 3

Payment Vouch. 2

1Payment Voucher

Prepare and obtain approval of

Cheque

Purchase Invoice

Remittance Adv.

Payment Vouch. 3

Payment Vouch. 2

Payment Vouch. 1

Cheque

N

Figure 21.10 : Accounts Department

Payment Voucher

Bookkeeper records in Cash

Book

Bookkeeper records in Purchase

Ledger

Cash Book

Purchase Ledger

N

Figure 21.11 : Accounts Department

Purchase Journal

Cash Book

Bookkeeper totals up the

record entries (monthly)

Bookkeeper totals up the

recorded entries

(monthly)

Bookkeeper posts the total

monthly sales to the Purchase

Ledger Control Account

Bookkeeper posts the total

monthly receipt to the Purchase Ledger Control

Account

General Ledger

No

Figure 21.12 : Accounts Department

General Ledger Purchase Ledger

Agree the Purchase Ledger Control A/c

balance with total of Purchase Ledger

balances

Balance

agree?

Bookkeeper prepares Creditors Reconciliation

Statement

Creditors Reconciliation Statement

No

Figure 21.13 : Accounts Departments

General Ledger Receive Statement of Account from

supplier

Statement of Account

Agree the Purchase Ledger Control A/c

balance with Statement of Account

Balance

agree?

Bookkeeper prepares Creditors Reconciliation

Statement

Creditors Reconciliation Statement

Figure 21.14 : Accounts Department

Received Bank Statement

Bank Statements Cash Book

Bookkeeper ticks off the items that are the same and pick out the un-presented cheques

and un-credited lodgement

Bookkeeper prepares Bank Reconciliation Statement

and obtains approval from officer

Bank Reconciliation Statement