Question

2 17 10 | Q1 The following transactions relate to Woodland Ltd - during March 2020, which is its first month of business. The business has two shareholders Harry and Laura employs 21 members of staff. March Transaction Harry invests £50,000 cash into the business. One member of staff goes pays £218 for stationery. A purchase is received from supplier Lesio Ltd to be paid for in 21 Days for £7,612 Cash sales of £5,849 were made to Tranpo Ltd. Woodland Ltd paid £225,000 for a Building to run the business from. An invoice for Business Rates was received for £1,701 to be paid on immediately. A credit sale was made to Strathore plc, due in 10 days for £7,121 12 BT sent a phone invoice of £1,619 to be paid for immediately. 12 The manager pays rent via DD of £2,819 per month. It is payable on 12th of each month. 13 | Vehicles are bought for £62, 150 on 30 Day credit terms from TC Harrison Ltd. 13 Credit sales were made to Strathore plc for £8,519 on the same terms as before. 15 A cash purchase was made from LMGD Ltd for £11,615 17 An invoice for water rates for £715 as received, to be paid in 14 days. 190 Laura was unhappy with the quality of some product received and returned 35% of Lesio Ltd's first delivery. 21 Cash Sales of £5,158 were made. 22 Laura invested £75,000 into the business. 25 An electricity invoice for £759 was received, to be paid on the last day of the month. Cash Sales of £3,217 were made. 27 There was another purchase on the same terms from Lesio Ltd for £3,859 28 A bank loan of £250,000 was received from HSBC. 28 Cash sales of £7,128 were banked 29 A credit sale was made to Showeh plc on 30 day terms for £8,152 30 Staff are paid wages of £7,397 30 Invoice received for £55,000 for Equipment. This is due to be paid in 7 days time. Cash sales of £7,569 were made. 31 Another sale for £9, 111 was made to Strathore plc on the same terms. s received, to be paid in 14 daysturned 35% of Lesio 25 30

Double Entry and Trial Balance

Answer 1

1) Harry invests 50,000 cash into business:

Cash a/c Dr. 50,000

To capital a/c            50,000

2) One member of the staff pays 218 for stationary

Stationary a/c dr     218

To Payable to staff a/c    218

3) A purchase is received from supplier Lesio to be paid in 21 days for 7612

Purchases A/c Dr. 7612

To Lesio a/c                      7612

4) cash sales of 5849 made to Tranpo

Cash a/c dr.     5849

To sales a/c               5849

5) Woodland paid 225,000 for building

Building A/c Dr.    225000

To Cash A/c                         225000

6) An invoice for 1701 to be paid immediately

Expense a/c Dr    1701

To Cash A/c                    1701

7) Credit sales made to Strathore for 7121

Strathore a/c Dr. 7121

To Sales a/c                    7121

Payment to receive on 20th march

Cash a/c Dr. 7121

To Strathore a/c                    7121

8) Phone invoice for 1619

Expense a/c Dr. 1619

To Cash a/c                  1619

9) Rent paid

Rent a/c Dr. 2819

To Cash a/c           2819

10) Purchase of vehicles

Vehicles a.c Dr 62150

To TC Harrison              62150

11) Credit sales made to Strathore for 8519

Strathore a/c Dr. 8519

To Sales a/c                    8519

Payment to receive on 23th march

Cash a/c Dr. 8519

To Strathore a/c                    8519

12) Cash purchase was for 11615

Purchases a/c dr. 11615

To cash a/c                       11615

13) Invoice to be paid

Expense a/c dr. 715

To payable                715

Invoice paid on 31st march for 14 days credit

Payable a/c dr. 715

To cash a/c              715

14) Return of sales

Lesio a/c dr. 2664.20

To purchases               2664.20

Payment to Lesio to be made on 23rd march

Lesio a/c dr. 4947.80

To cash a/c                   4947.80

15) Cash sales of 5158

Cash a/c dr. 5158

To sales a/c           5158

16) Laura invests 75000 in business

Cash a/c dr. 75000

To capital a/c          75000

17) Invoice to be paid

Expense a/c dr 759

To cash a/c                759

18) Cash sales 3217

Cash a/c dr. 3217

To sales a/c           3217

19) Purchases from Lesio

Purchases A/c Dr. 3859

To Lesio a/c                      3859

20) Bank loan 250000

Cash a/c dr 250000

To bank loan            250000

21) Cash sales

Cash a/c dr. 7128

To sales a/c           7128

22) Credit sales to Showeh

Showeh a/c dr. 8152

To sales a/c                 8152

23) Wages paid

Wages a/c dr. 7397

To cash a/c               7397

24) Invoice for equipment

Expense a/c dr. 55000

To payable a/c               55000

25) Cash sales

Cash a/c dr. 7569

To sales a/c           7569

26) Credit sales made to Strathore for 9111

Strathore a/c Dr. 9111

To Sales a/c                    9111

Trial balance

Sr no	Description	Debit (Dr)	Credit (Cr)
1	Capital		125000
2	cash	162988.2
3	Stationary	218
4	Payable to staff	218
5	Purchases	20421.8
6	Lesio		3859
7	sales		61824
8	Building	225000
9	Expense	59794
10	rent	2819
11	Vehicles	62150
12	TC Harrison		62150
13	Bank loan		250000
14	Showeh	8152
15	Wages	7397
16	Payables		55000
17	Strathore	9111
	Total	558051	558051

1) Harry invests 50,000 cash into business:

Cash a/c Dr. 50,000

To capital a/c            50,000

2) One member of the staff pays 218 for stationary

Stationary a/c dr     218

To Payable to staff a/c    218

3) A purchase is received from supplier Lesio to be paid in 21 days for 7612

Purchases A/c Dr. 7612

To Lesio a/c                      7612

4) cash sales of 5849 made to Tranpo

Cash a/c dr.     5849

To sales a/c               5849

5) Woodland paid 225,000 for building

Building A/c Dr.    225000

To Cash A/c                         225000

6) An invoice for 1701 to be paid immediately

Expense a/c Dr    1701

To Cash A/c                    1701

7) Credit sales made to Strathore for 7121

Strathore a/c Dr. 7121

To Sales a/c                    7121

Payment to receive on 20th march

Cash a/c Dr. 7121

To Strathore a/c                    7121

8) Phone invoice for 1619

Expense a/c Dr. 1619

To Cash a/c                  1619

9) Rent paid

Rent a/c Dr. 2819

To Cash a/c           2819

10) Purchase of vehicles

Vehicles a.c Dr 62150

To TC Harrison              62150

11) Credit sales made to Strathore for 8519

Strathore a/c Dr. 8519

To Sales a/c                    8519

Payment to receive on 23th march

Cash a/c Dr. 8519

To Strathore a/c                    8519

12) Cash purchase was for 11615

Purchases a/c dr. 11615

To cash a/c                       11615

13) Invoice to be paid

Expense a/c dr. 715

To payable                715

Invoice paid on 31st march for 14 days credit

Payable a/c dr. 715

To cash a/c              715

14) Return of sales

Lesio a/c dr. 2664.20

To purchases               2664.20

Payment to Lesio to be made on 23rd march

Lesio a/c dr. 4947.80

To cash a/c                   4947.80

15) Cash sales of 5158

Cash a/c dr. 5158

To sales a/c           5158

16) Laura invests 75000 in business

Cash a/c dr. 75000

To capital a/c          75000

17) Invoice to be paid

Expense a/c dr 759

To cash a/c                759

18) Cash sales 3217

Cash a/c dr. 3217

To sales a/c           3217

19) Purchases from Lesio

Purchases A/c Dr. 3859

To Lesio a/c                      3859

20) Bank loan 250000

Cash a/c dr 250000

To bank loan            250000

21) Cash sales

Cash a/c dr. 7128

To sales a/c           7128

22) Credit sales to Showeh

Showeh a/c dr. 8152

To sales a/c                 8152

23) Wages paid

Wages a/c dr. 7397

To cash a/c               7397

24) Invoice for equipment

Expense a/c dr. 55000

To payable a/c               55000

25) Cash sales

Cash a/c dr. 7569

To sales a/c           7569

26) Credit sales made to Strathore for 9111

Strathore a/c Dr. 9111

To Sales a/c                    9111

Trial balance

Sr no	Description	Debit (Dr)	Credit (Cr)
1	Capital		125000
2	cash	162988.2
3	Stationary	218
4	Payable to staff	218
5	Purchases	20421.8
6	Lesio		3859
7	sales		61824
8	Building	225000
9	Expense	59794
10	rent	2819
11	Vehicles	62150
12	TC Harrison		62150
13	Bank loan		250000
14	Showeh	8152
15	Wages	7397
16	Payables		55000
17	Strathore	9111
	Total	558051	558051