Assignment General information Al Wilson owns and runs a retail and wholesale surf shop, Surf...

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Assignment

General information

Al Wilson owns and runs a retail and wholesale surf shop, Surf Haven, in a sea side town The business is situated on a prominent corner of the town at 1 View Street, Bell’s Inlet. Its custom is mainly from young surf board, sailing and boogie board riders.

The shop has a nautical atmosphere and is very well organised. Products consist of surfboards, sailboards and boogie boards. Surf Haven also sells second-hand surfboards on commission.
Surf Haven also supplies many of the surf shops around the coast.
The business charges GST on all inventory sales and surfing lessons, and pays GST on inventory purchases and most business expenses.

Employees
Surf Haven employs two casual assistants, Brian Jardine, works as a surfing instructor with Al and Carl Holland who works in the shop selling stock, and taking bookings for surf lessons. Fred pays both Brian and Carl $30 per hour. Each employee works between 10 to 15 hours per week, depending on the season and demand. Payday is every second Wednesday.

At the end of Fe
uary, Surf Haven owed 4 hours pay to both Brian and Carl.

Note: Do not use the payroll section of MYOB; record wages expense cash payment.

Goods and Services Tax
Surf Haven pays GST of 10% on all business expenses, except wages. Non-cu
ent asset acquisitions are also taxed at 10%.

Merchandise Inventory
The following is a list of closing inventory and the suppliers as at 28 Fe
uary 2018.
    Quantity on hand
    Item
Code
    Description
    Cost Price
         Sale
Price
    Supplier
    20
    SFB
    Surfboards
    $420
    $750
    Custom Surfboards
    15
    BBD
    Boogie Boards
    $120
    $240
    Wave Rider
    30
    SFM
    Surfing Manuals
    $10
    $25
    Seahorse Publishers

Each of the above items of inventory is quoted excluding GST.

The required inventory is purchased on credit under the terms of payment required by the suppliers.
Al has a good relationship with each of his suppliers. Once he places an order, the suppliers will deliver them free of charge the same day.

Lessons
All lessons are paid for at the time of the lesson and is recorded separately to the sale of inventory.

Supplier information
Suppliers account balances at 28 Fe
uary 2018.
    Name
    Address
    Account Balance
    Custom Surfboards ABN XXXXXXXXXX
    56 Main Street, Torquay
    $3,700
     Wave Rider
ABN XXXXXXXXXX
    2 Beach Road, Fairhaven
    $5,500
    Seahorse Publishers XXXXXXXXXX
    1B Carlton Parade, Geelong
    $2,300

Each of the above account balances represents deliveries of inventory received on 22 Fe
uary 2018; all purchases are on terms 2/10, n30. All inventory items are delivered on the same day as they are ordered.


Customer information
Surf Haven sells most of its inventory strictly on a cash basis, but the business has three credit customers. Terms of payment for these customers are net 30 days.
Customer balances at 28 Fe
uary 2018:
    Name
    Address
    Date Last Invoice
    Account Balance
    Sharkeys Wye River ABN XXXXXXXXXX
    14 Bay Street
Wye River
    Feb 18
    $2,400
    Torquay Surf Shop ABN XXXXXXXXXX
    47 Buckley Road,
Torquay
    Feb 20
    $4,000
    Aireys Surf Club ABN XXXXXXXXXX
    3 Aireys Lane
Aireys Inlet
    Feb 22
    $1,700
Terms of payment for customers is 2/10, n30. Freight of $50 (GST exclusive) is charged for all credit sales.

Trial Balance as at 28 Fe
uary 2018

    Account
    Debit ($)
    Credit ($)
     1-1110
     Bank
    10,500

     1-1200
     Accounts Receivable
    8,100

     1-1300
     Inventory
    10,500

     1-1400
     Stationery supplies
    650

     1-3110
     Shop Fittings & equipment (cost)
    12,500

     1-3120
     Accumulated depreciation Shop fittings & equipment

    1,450
     1-3210
     Motor vehicle (cost)
    22,000

     1-3220
     Accumulated Depreciation - Motor Vehicle.

    3,500
     2-1200
     Accounts Payable

    11,500
     2-1310
     Net GST Payable

    560
     2-1350
     Wages payable

    240
     2-2100
     Loan – ANZ Bank, Bell’s Inlet

    20,000
     3-1200
     Capital – Al Jardine

    27,000

     Total
    64,250
    64,250


Transactions: March 2018

    1     Paid cash for printing expenses to Acorn Press– $594 (GST Inclusive).[chq 201]
1 Purchased a new cash register for $2,310 (GST inclusive) [chq 202].It is expected that the cash register will have an effective life of 6 years with a nil residual value.
2 Paid three month’s rent of $4,620 (GST inclusive) to Prime Real Estate. [chq 203].
3 Paid for two months (March & April) advertising in the Surfing Times – $286 (GST inclusive) [chq 204]
4 Credit sale to Airey’s Surf Club : inventory sold: 2 boogie boards, 2 surfboards, 3 surfing manuals (Invoice CR663)
5 Received payment of $4,000 from Torquay Surf Shop
    8     Received $1,540 (GST inclusive) for surfing lessons.
8 Paid Seahorse Publishers for Fe
uary account. [chq 205]
9 Paid cash to GMJ Autos for vehicle expenses- $297 – (Including GST) [chq 206]
    9     Purchased inventory: 12 surfboards and 16 boogie boards. (P.O. 326, 327)
9 Received payment from Starkey’s Wye River for balance outstanding at 27 Fe
uary.
10 Paid Wave Rider the balance outstanding at 28 Fe
uary. [chq 207]
10 Purchased office supplies from Ace Office Supplies, $803 [chq 208]
11 Sales Invoice sent to Sharkeys Wye River for the following items:6 surfboards, 6 boogie boards, 10 surfing manuals (invoice CR664)
12 Received $3,410 (GST inclusive) from Point Hicks School for surfing lessons.
12 Pay day. Carl was paid for 28 hours and Brian was paid for 30 hours; the payments included wages owing from Fe
uary. [Chqs 209 & 210]
12 Purchased inventory: 15 surfboards and 12 surfing manuals (P.O. 328)
14 Received payment from Airey’s Surf Club for Fe
uary account.
15 Credit sale to Torquay Surf Club: 14 surfboards, 10 boogie boards and 15 surfing manuals (Invoice CR665)
16 Cash drawings – Cheque payable to Al Wilson of $2,000 [chq 211]
16 Paid cash for vehicle expenses – $220 (Including GST) [chq 212]
16 Purchased 12 boogie boards (P.O. 329)
17 Received payment from Airey’s Surf Club for 4 March sales.
17 Returned 2 boogie boards to Wave Rider. They were slightly damaged. A Credit Note was issued by the supplier. These items were from the purchase on 16 March
18 Received payment from Sharkey’s Wye River for inventory sold on 11 March.
18 Cash sales of 3 surfboards and 3 surfing manuals (Invoice CS754)
19 Purchased 10 surfing manuals (P.O. 330)
19 Paid Australian Taxation Office GST owing [Chq 213]
20 Paid Wave Rider for inventory purchased on 16 March [Chq 214]
21 Paid Custom Surfboards the balance outstanding on 28 Fe
uary 2018[chq 215]
22 Credit sale to Aireys Surf Club: 5 surfboards and 5 boogie boards (Invoice CR666)
23 Purchased 12 surfboards and 15 surfing manuals (P.O. 331 & 332)
23 Al introduces a new product for sale. He purchased 20 sailboards from Wave Rider for $400 each (GST exclusive) (P.O XXXXXXXXXXSelling price of the sailboards is $640 each (GST exclusive).
24 Paid Custom Surfboards for inventory purchased on 12 March. [Chq 216]
24 Paid monthly repayment to ANZ for bank loan; $1,050 (includes $50 interest). GST is not payable on this transaction. Fred decided that the business would pay an additional $500 off the loan principal. [chq 217]
25 Paid Telstra Ltd for business phone accounts - $572 (GST Inclusive) [chq 218]
25 Credit sale to Sharkeys Wye River: 8 surfboards, 9 boogie boards and 7 sailboards. (Invoice CR667)
26 Pay day. Carl was paid for 30 hours and Brian was paid for 24 hours. [chqs 219 & 220]
26 Sharkeys Wye River returned 1 sailboard and received a credit note. The sailboard was undamaged and returned to inventory.
27 Received $2,695 cash (GST inclusive) for surfing lessons.
    27
27 A customer purchased 3 surfboards for cash at a special price of $1,485 each (including GST). The customer also purchased 6 surfing manuals at the normal price. (Invoice CS755)
28 Received partial payment of $7,000 from Torquay Surf Club.
31 The ANZ Bank in Williamsville has sent a bank statement for the month of March 2018. The following items were noted from the bank statement:
· Bank fees of $35 were debited to the account on 30 March
· A credit for an electronic transfer of $1,200 was received for sale of second-hand surfboards on commission.

Adjustments at 31 March 2018

Some of the necessary adjustments are to be found in the transactions above. Other adjustments are listed below.
1. The physical stock take does not agree with the computer records and adjustments for inventory are required.
         Physical stock-take as at 31 March 2018:
· Surfboards 18 • Sailboards 14
· Boogie boards      8
· Surfing manuals 28


2. A stock take of stationery supplies revealed $540 of stationery on hand at 31 March 2018.
3. The shop fittings are to be depreciated using the straight line method, at 15% per annum on cost. The motor vehicle is to be depreciated using the straight line method at 20% per annum on cost.
4. Accrued wages owing on 31 March 2018: Carl – 8 hours, and Brian – 10 hours.

Accounts List

Assets
    1-1000     Cu
ent Assets
    1-1110     Cash at Bank
    1-1180     Undeposited funds
    1-1190     Electronic clearing account
    1-1200     Trade Accounts Receivable
    1-1250     Other income receivable
    1-1300     Inventory

tae_636614411005773324_118045_1.docx tae_636614411005773324_118045_2.docx tae_636614411005773324_118045_3.xls

Pulkit · Accepted Answer

GnlJnl
	GENERAL JOURNAL
	Date			Post
			Description	Ref.	Debit	Credit
	March	17	Accounts Payable	2-1200	264.00
			Inventory	1-1300		240.00
			GST Paid	2-1330		24.00
			Returned 2 damaged Boogie boards
		26	Sales Returns and Allowances	4-1200	640.00
			GST Collected	2-1310	64.00
			Accounts Receivable	1-1200		704.00
			1 sailboard returned by Sharkeys Wye River
			Inventory	1-1300	400.00
			Cost of Sales	5-1100		400.00			1 boogie
			1 sailboard returned put back into inventory						2 surf manua
		31	Cash register-depreciation	6-1500	350.00
			Cash register-accumulated depreciation	1-3320		350.00
			Annual depreciation of cash register
		31	Invetory lost expenses	5-1200	140.00
			Invetory	1-1300		140.00
			Lost 1 boogie board and 2 surfing manual
		31	Stationary Supplies Expense (650+730-540)	6-1800	840.00
			Stationary Supplies	1-1400		840.00
			Stationary Suppiles used during the month
		31	Shop fittings equipment-depreciation	6-1300	1875.00
			Shop fittings equipment-accumulated depreciation	1-3120.		1875.00
		31	Motor vehicle-depreciation	6-1400	4400.00
			Motor vehicle-accumulated depreciation	1-3220.		4400.00
		31	Wages and Salaries Expense	6-1930.	540.00
			Wages Payable	2-1700		540.00
			Accrued Wages
PurJnl
	PURCHASES JOURNAL                                  Page: 11
	Date		P.O.			Post.		Freight	GST Paid	Accounts
			No.	Account	Terms	Ref.	Inventory	Paid	(Outlays)	Payable			cost	sale
	March											Surfboards	420	750		20
		9	326	Custom Surfboards	2/10, n/30		5,040.00		504.00	5,544.00		Boogie Boards	120	240		15
		9	327	Wave Rider	2/10, n/30		1,920.00		192.00	2,112.00		Surfing Manuals	10	25		30
		12	328	Custom Surfboards	2/10, n/30		6,300.00		630.00	6,930.00		Sailboards	400	640
		12	328	Seahorse Publishers	2/10, n/30		120.00		12.00	132.00
		16	329	Wave Rider	2/10, n/30		1,440.00		144.00	1,584.00
		19	330	Seahorse Publishers	2/10, n/30		100.00		10.00	110.00
		23	331	Custom Surfboards	2/10, n/30		5,040		504.00	5,544.00
		23	332	Seahorse Publishers	2/10, n/30		150.00		15.00	165.00
		23	333	Wave Rider	2/10, n/30		8000		800.00	8,800.00
				Total			28110.00		2811.00	30921.00
SalesJnl
	SALES JOURNAL
			Inv.			Post	Cost of		Freight	GST	Accounts			cost	sale
	Date		No.	Account	Terms	Ref.	Goods Sold	Sales	Collected	Collected	Receivable		Surfboards	420	750
	March												Boogie Boards	120	240
		4	CR663	Airey’s Surf Club	2/10, n/30		1,110.00	2,055.00	50.00	210.50	2,315.50		Surfing Manuals	10	25
		11	CR664	Sharkeys Wye River	2/10, n/30		3,340.00	6,190.00	50.00	624.00	6,864.00		Sailboards	400	640
		15	CR665	Torquay Surf Club	2/10, n/30		7,230.00	13,275.00	50.00	1,332.50	14,657.50
		22	CR666	Airey’s Surf Club	2/10, n/30		2,700.00	4,950.00	50.00	500.00	5,500.00
		25	CR667	Sharkeys Wye River	2/10, n/30		7,240.00	12,640.00	50.00	1,269.00	13,959.00
				Total			21620.00	39110.00	250.00	3936.00	43296.00
CRJ
	CASH RECEIPTS JOURNAL
	Date						Debits		Credits
				Post	Disc	GST	Cash at	Cost of	Cash	Lessons	Accounts	GST
			Account	Ref.	Exp	Coll	Bank	Goods Sold	Sales		Receivable	Collected	Other
	March														cost	sale
		5	Torquay Surf Shop				4000.00				4000.00			Surfboards	420	750
		8	Surfing lessons				1540.00			1400.00		140.00		Boogie Boards	120	240
		9	Starkey’s Wye River				2400.00				2400.00			Surfing Manuals	10	25
		12	suffing lessons-Point Hick				3410.00			3100.00		310.00
		14	Airey’s Surf Club				1700.00				1700.00
		17	Airey’s Surf Club				2315.50				2315.50
		18	Sharkeys Wye River		124.8	12.48	6726.72				6864.00
		18	Cash sales				2557.50	1290.00	2325.00			232.50
		27	Surfing lessons				2695.00			2450.00		245.00
		27	Cash sales				5065.50	1320.00	4605.00			460.50
		28	Torquay Surf Shop				7000.00				7000.00
		31	Commission				1200.00						1200.00
			Total		124.8	12.48	40610.22	2610	6930	6950	24279.5	1388	1200
CPJ
	CASH PAYMENTS JOURNAL
						Debits						Credits
				Cheque	Post	Accounts	GST Paid					Cash at	Discount	GST Paid
	Date		Account	No.	Ref.	Payable	Rec'able	Wages	Vehicle	Drawings	Other	Bank	Received	Rec'able
	March
		1	Printing expenses	201			54.00				540.00	594.00
		1	purchase new cash register				210.00				2,100.00	2,310.00
		2	rent (Prime real estate)	203			420.00				4,200.00	4,620.00
		3	advertising expenses	204			26.00				260.00	286.00
		8	Seahorse Publishers	205		2,300.00						2,300.00
		9	vehicle expense-GMJ autos	206			27.00		270.00			297.00
		10	Wave Rider	207		5,500.00						5,500.00
		10	Purchase stationary supplies	208			73.00				730.00	803.00
		12	wages - Carl	209				840.00				840.00
		12	wages - Brian	210				900.00				900.00
		16	cash drawings	211						2,000.00		2,000.00
		16	vehicle expenses	212			20.00		200.00			220.00
		19	GST Paid to ATO	213	2-1310		560.00					560.00
		20	Wave Rider	214		1,320.00						1,293.60	24.00	2.40
		21	Custom Surfboards	215		3,700.00						3,700.00
		24	Custom Surfboards	216		6,930.00						6,930.00
		24	Paid monthly repayment	217							1,500.00	1,500.00
		24	Interest expenses	217							50.00	50.00
		25	Telstra Ltd	218			52.00				520.00	572.00
		26	wages-Carl	219				900.00				900.00
		26	wages-Brian	220				720.00				720.00
		31	bank fees expense								35.00	35.00
			Total			19,750	1,442	3,360	470	2,000	9,935	36,931	24	2.40
GenLdger-Rbal
	GENERAL LEDGER
	Name:   CASH AT BANK                                                                              Acct No.:  1-1110
						Post.
	Date		Explanation			Ref.	Debit	Credit	Balance
	March
		1	Opening Balance				10500.00		10500.00
		31	Trade Accts Rec. Control			CRJ	40610.22		51110.22
		31	Trade Accts Pay. Control//Wages			CPJ		36930.60	14179.62
	Name: TRADE ACCOUNTS RECEIVABLE                                                  Acct No.:  1-1200
						Post.
	Date		Explanation			Ref.	Debit	Credit	Balance
	March
		1	Opening Balance				8100.00		8100.00
		26	Sales Returns & Allow.			GJ		704.00	7396.00
		31	Sales			SJ	43296.00		50692.00
		31	Payments Received			CRJ		24279.50	26412.50
	Name: INVENTORY                                                                                  Acct.:1-1300
	Date		Explanation			Ref.	Debit	Credit	Balance
	March
		1	Opening Balance				10500.00		10500.00
		17	Returns to supplier			GJ		240.00	10260.00
		26	Returns from customer			GJ	400.00		10660.00
		31	Purchase inventory			PJ	28110.00		38770.00
		31	Cost of Sales			SJ		21620.00	17150.00
		31	Cost of Sales			CRJ		2610.00	14540.00
		31	Inventory Shortage Expense			GJ		140.00	14400.00
	Name: STATIONERY SUPPLIES                                                                Acct.:1-1400
	Date		Explanation			Ref.	Debit	Credit	Balance
	March
		1	Opening Balance				650.00		650.00
									`
		10	Purchase stationary supplies			CPJ	730.00		1380.00
		31	Stationary supplies expenses			GJ		840.00	540.00
	Name: SHOP FITTINGS-COST                                                                       Acct No.: 1-3110
						Post.
	Date		Explanation			Ref.	Debit	Credit	Balance
	March
		1	Opening Balance				12500.00		12500.00
	Name: SHOP FTIINGS-ACCUMULATED DEPRECIATION                              Acct No.: 1-3120
	March
		1	Opening Balance					1450.00	1450.00
		31	Depreciation expenses			GJ		1875.00	3325.00
	Name: MOTOR VEHICLE -COST                                                                Acct No.: 1-3210
						Post.
	Date		Explanation			Ref.	Debit	Credit	Balance
	March
		1	Opening Balance				22000.00		22000.00
	Name: MOTOR VEHICLE-ACCUMULATED DEPRECIATION                           Acct No.: 1-3220
						Post.
	Date		Explanation			Ref.	Debit	Credit	Balance
	March
		1	Opening Balance					3500.00	3500.

Assignment General information Al Wilson owns and runs a retail and wholesale surf shop, Surf Haven, in a sea side town The business is situated on a prominent corner of the town at 1 View Street,...

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