ACCOUNTS FROM INCOMPLETE RECORDS SINGLE ENTRY SYSTEM MODULE II OF IV

Transcription

1 ACCOUNTS FROM INCOMPLETE RECORDS SINGLE ENTRY SYSTEM MODULE II OF IV 1 CA. Prathap S.S

2 Agenda In Module II, we will focus on mastering the Journal Entries concerning Accounts from Incomplete Records. To become very familiar with T accounts Post the Journal Entries in them. Arrive at Opening / Closing Balances Ascertain the balances of the missing data. 2

3 Introduction Journal Entries are of fundamental importance in Accounts. Once you get the JE right, it is very difficult to go wrong. 3

4 4 IPCC MAY 2012 Ice Sum (8 marks)

5 M/s Ice Ltd gives you the following information to find out Total sales and Total Purchases Debtors on ,000 Creditors on ,000 Bills Receivables received during the year 47,000 Bills Payables during the year 53,000 Cash received from customers 1,56,000 Cash paid to suppliers 1,72,000 Bad Debts Recovered 16,000 Bills Receivables endorsed to Creditors 27,000 Bills Receivables dishonored by customers 5,000 Discount allowed by suppliers 7,000 (contd..) 5

6 ...Ice sum Discount allowed to customers 9,000 Endorsed Bills Receivables dishonored 3,000 Sales Return 11,000 Bills Receivables discounted 8,000 Discounted Bills Receivables dishonored 2,000 Cash Sales 1,68,500 Cash Purchases 1,97,800 Debtors on ,000 Creditors on ,000 6

7 Approach to the Sum This is a classical sum wherein the complete Sundry Debtors and Sundry Creditors ledgers have to be opened. Our approach will be transaction by transaction passing Journal Entries and simultaneous updating the Debtors and Creditors ledger accounts. 7

8 Requirements of the Sum The requirement is calculation of Total Sales and Total Purchases. Total Sales = Cash Sales + Credit Sales Credit Sales will be obtained from Sundry Debtor s A/c and Cash Sales is given. Total Purchase = Cash Purchase + Credit Purchase Sundry Creditor s A/c will supply the Credit Purchases and Cash Purchases is given. 8

9 Steps to be Followed Step 1: Open Sundry Debtor s a/c and Sundry Creditor s A/c with the Opening balances given. The Bills receivables and Bills Payable A/c can also be opened. Step 2: Line by line pass Journal Entry and update both the A/c s. 9

10 10 JOURNAL ENTRIES

11 Opening Sundry Debtors & Creditors Sundry Debtors A/c To Opening Balance 70,000 Sundry Creditors A/c By Opening balance 81,000 11

12 Bills Receivables received during the year Rs.47,000. Bills Receivables A/c Dr. 47,000 To Sundry Debtors A/c 47,000 Sundry Debtors A/c To Opening Balance 70,000 By Bills Receivables A/c 47,000 Bills Receivables A/c To Sundry Debtors 47,000 12

13 Bills Payables issued during the year Rs.53,000. Sundry Creditors a/c Dr. 53,000 To Bills Payables a/c 53,000 Sundry Creditors A/c To Bills Payables 53,000 By Opening Balance 81,000 Bills Payables A/c By Sundry Creditors 53,000 13

14 Cash received from customers Rs. 1,56,000. Cash A/c Dr. 1,56,000 To Sundry Debtors A/c 1,56,000 Sundry Debtors A/c To Opening Balance 70,000 By Bills Receivables 47,000 By Cash 1,56,000 14

15 Cash paid to suppliers Rs.1,72,000 Sundry Creditor s A/c Dr. 1,72,000 To Cash A/c 1,72,000 Sundry Creditors A/c To Bills Payable 53,000 By Opening Balance 81,000 To Cash 1,72,000 15

16 Bad Debts recovered Rs.16,000 Cash A/c Dr. 16,000 To Bad Debts recovered A/c 16,000 This Journal Entry will not find a posting in the Sundry Debtors A/c. 16

17 Bills Receivables endorsed to creditors Rs.27,000 Creditors A/c Dr. 27,000 To Bills Receivables A/c 27,000 Sundry Creditors A/c To Bills Payable 53,000 By Opening Balance 81,000 To Cash 1,72,000 To Bills Receivables 27,000 Bills Receivables A/c To Sundry Debtors 47,000 By Creditors 27,000 17

18 Bills Receivables dishonoured by customers Rs. 5,000 Debtors A/c Dr. 5,000 To Bills Receivables A/c 5,000 Sundry Debtors A/c To Opening Balance 70,000 By Bills Receivables 47,000 To Bills Dishonoured 5,000 By Cash 1,56,000 Bills Receivables A/c To Sundry Debtors 47,000 By Creditors 27,000 By Sundry Debtors 5,000 18

19 Discount allowed by suppliers Rs.7,000 Sundry Creditor s A/c Dr. 7,000 To Discount allowed A/c 7,000 Sundry Creditors A/c To Bills Payable 53,000 By Opening Balance 81,000 To Cash 1,72,000 To Bills Receivables 27,000 To Discount allowed 7,000 19

20 Discount allowed to customers Rs.9,000 Discount a/c Dr. 9,000 To Sundry Debtor s A/c 9,000 Sundry Debtor s A/c To Opening Balance 70,000 By Bills Receivables 47,000 To Bills rec. Dishonoured 5,000 By Cash 1,56,000 By Discount 9,000 20

21 Endorsed Bills Receivables dishonoured Rs.3,000 Debtors A/c Dr. 3,000 To Creditors A/c 3,000 Sundry Debtors A/c To Opening Balance 70,000 By Bills Receivables 47,000 To Bills rec. Dishonoured 5,000 By Cash 1,56,000 To Creditors(endorsed bill dishonoured) 3,000 By Discount 9,000 Sundry Creditors A/c To Bills Payable 53,000 By Opening Balance 81,000 To Cash 1,72,000 By Debtors(endorsed bill dishonoured) To Bills Receivables 27,000 To Discount allowed 7,000 3,000 21

22 Sales Return Rs.11,000 Sales Return A/c Dr. 11,000 To Sundry Debtor s A/c 11,000 Sundry Debtor s A/c To Opening Balance 70,000 By Bills Receivables 47,000 To Bills rec. Dishonoured 5,000 By Cash 1,56,000 To Creditors 3,000 By Discount 9,000 By Sales Return 11,000 22

23 Bills Receivables discounted Rs.8,000 Bank A/c Dr. 8,000 To Bills Receivables A/c 8,000 Bills Receivables A/c To Sundry Debtors 47,000 By Creditors 27,000 By Sundry Debtors 5,000 By Bank 8,000 23

24 Discounted Bills Receivable dishonoured Rs.2,000 Debtors A/c Dr. 2,000 To Bank A/c 2,000 Sundry Debtors A/c To Opening Balance 70,000 By Bills Receivables 47,000 To Bills rec. Dishonoured 5,000 By Cash 1,56,000 To Creditors 3,000 By Discount 9,000 To Bank (bills receivable dishonoured) 2,000 By Sales Return 11,000 24

25 Sundry Debtors A/c To Balance b/d 70,000 By Bills Receivables 47,000 To Bills Receivables 5,000 By Cash 1,56,000 To Creditors 3,000 By Discount 9,000 To Bank 2,000 By Sales Returns 11,000 To Annual Credit Sales (bal.fig) 2,25,000 By Balance c/d 82,000 3,05,000 3,05,000 25

26 Bills Receivables A/c To Sundry Debtors 47,000 By Creditors 27,000 By Debtors 5,000 By Bank 8,000 By Balance c/d 7,000 47,000 47,000 26

27 Sundry Creditors A/c To Bills Payables 53,000 By Balance b/d 81,000 To Cash 1,72,000 By Debtors 3,000 To Bills 27,000 By Annual Receivables Credit Purchase 2,70,000 To Discount 7,000 (bal.fig) To Balance c/d 95,000 3,54,000 3,54,000 27

28 Bills Payables A/c To Balance c/d 53,000 By Creditors 53,000 53,000 53,000 28

29 Final Answer (a) Total Sales = Cash sales + Credit sales = 1,68, ,25,000 Total Sales = 3,93,500 (b) Total Purchases =Cash purchases + Credit Purchase = 1,97, ,70,000 Total Purchases = 4,67,800 29

30 Summary In this II module, we learnt some important Journal Entries, creation of Sundry Debtors & Creditors A/c and ascertaining the Annual Credit Sales and Annual Credit Purchases. 30

31 THANK YOU 31 Do keep moving forward