Tutorial 3 Purchases & Sales Cycles 1 LTJ 2020

Tutorial 3: Suggested solutions Grand 421 6,000

15 Grand 455 8,000
Section A: 31 Purchases Account (Dr) 25,500

1. (a) Purchases Journal is also known as Purchases Day Book. It is a

listing of all the credit purchases during the period, based on dates of Returns Outwards Journal
purchases. The details listed are the suppliers names, suppliers’ invoice Date Particulars Credit RM RM
numbers and amounts of the invoices. The total amount of purchases Note
will be posted to the purchases account at the end of the month. Jan
5 Super 876 500
(b) Sales Journal is also known as Sales Day Book. It is a listing of all 8 Grand 098 1,000
the credit sales during the period, based on dates of sales. The details 22 Fantastic 368 3,000
listed are the customers’ names, seller’s invoice numbers and amounts. Less : trade discount 10% (300) 2,700
The total amount of sales will be posted to the sales account at the end 31 Returns Outwards Account (Cr) 4,200
of the month.
Cash Book
2. Purchases returns are also known as returns outwards. The reasons for Date Particular Fol Disc. Cash Bank Date Particular Fol Disc. Cash Bank
returns could be the supplier asked all customers to return a specific Allw Rec’d
item (example an electrical good was found to be dangerous), clothing
Jan RM RM RM Jan RM RM RM
was the wrong size, goods were faulty and other reasons. They are
TP:
recorded in the returns outwards journal based on the credit notes of the 1 Bal b/d 23,000 46,000 5
Super
1,000 9,000
suppliers. 12
TP:
500 4,500
Fantastic
28 TP: Grand 240 2,160
Sales returns are also known as returns inwards. These are returns of
goods by credit customers mainly due to defects, spoilage, legal rights 31 Bal c/d 18,500 34,840
or other reasons. They are recorded in the returns inwards journal and 23,000 46,000 1,740 23,000 46,000
the source documents are the credit notes of the seller. Feb
1 Bal b/d 18,500 34,840

Question 3
(b) Purchases Ledger
(a) Purchases Journal
Date Particulars Invoice No. RM RM
Trade Payables: Super Account
Jan
Jan RM Jan RM
3 Fantastic 23 5,000
5 Return outwards 500 1 Bal b/d 18,000
Less: trade discount 10% (500) 4,500
5 Bank 9,000 10 Purchases 7,000
10 Super 542 7,000 Discount received
5 1,000
Tutorial 3 Purchases & Sales Cycles 2 LTJ 2020

31 Bal c/d 14,500 31 Discount received 1,740

25,000 25,000 31 Bal c/d 72,900
94,500 94,500

Trade Payables: Fantastic Account Purchases Account

Jan RM Jan RM Jan RM Jan RM
22 Return outwards 2,700 1 Bal b/d 30,000 31 Trade Payables 25,500
12 Cash 4,500 3 Purchases 4,500
12 Discount received 500 Return Outwards Account
31 Bal c/d 26,800 Jan RM Jan RM
34,500 34,500 31 Trade Payables 4,200

Discount Received Account

Jan RM Jan RM
Trade Payables: Grand Account 31 Trade Payables 1,740
Jan RM Jan RM
8 Return outwards a/c 1,000 1 Bal b/d 21,000
28 Bank a/c 2,160 10 Purchases a/c 6,000
28 Discount received a/c 240 15 Purchases a/c 8,000
31 Bal c/d 31,600 Question 4
35,000 35,000 (a) Sales Journal
Date Particular Invoice No. RM RM
Trade Payable List May
RM 1 Arumugam Trading 120 750
Super 14,500 Less: trade discount 10% (75) 675
Fantastic 26,800
Grand 31,600 8 Chop Seng Fatt 121 900
72,900 Less: trade discount 10% (90) 810
31 Sales Account (Cr) 1,485
(c) General Ledger
Returns Inwards Journal
Trade Payables Control Account Date Particular Credit RM RM
Jan RM Jan RM Note No.
31 Returns Outwards 4,200 1 Bal b/d 69,000 May
31 Cash 4,500 31 Purchases 25,500 5 Arumugam Trading 220 120
31 Bank 11,160 Less: trade discount 10% (12) 108
Tutorial 3 Purchases & Sales Cycles 3 LTJ 2020

13 Chop Seng Fatt 221 150 Trade Receivables list

Less: trade discount 10% (15) 135 RM
31 Returns Inwards Account (Dr) 243 Arumugam Trading 167
Chop Seng Fatt 175
Cash Book 342
Date Particular Fol Disc. Cash Bank Date Particular Fol Disc. Cash Bank
Allw Rec’d (c) General Ledger
May RM RM RM May RM RM RM
TR: Trade Receivables Control Account
26 Chop Seng 25 475 May RM May RM
Fatt 31 Sales 1,485 31 Returns Inwards 243
TR: 31 Cash 380
27 Arumugam 20 380 31 Bal c/d 380 475 31 Bank 475
Trading 31 Discount Allowed 45
45 380 475 380 475 31 Bal c/d 342
1,485 1,485
June
1
Bal b/d 380 475

(b) Sales Ledger Sales Account

Trade Receivables: Arumugam Trading May RM May RM
May RM May RM 31 Trade Receivables 1,485
1 Sales 675 5 Returns Inwards 108
27 Cash 380
27 Discount allowed 20
31 Bal c/d 167 Return Inwards Account
675 675 May RM May RM
31 Trade Receivables 243
Trade Receivables: Chop Seng Fatt
May RM May RM
8 Sales 810 13 Returns Inwards 135
26 Bank 475 Discount Allowed Account
26 Discount allowed 25 May RM May RM
31 Bal c/d 175 31 Trade Receivables 45
810 810