Expert answer:General Journal, General Ledger and Trial Balance

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QUESTION 1: General Journal, General Ledger, Trial Balance (35 marks)
Penny is the sole proprietor of Atrium Floral Supplies (AFS), a florist company specialising in
weddings and corporate functions. The following is a list of transactions that took place during the
month of June 2017.
June 1
The business purchased additional equipment costing $4,600, paying a 25% cash
deposit and the balance by increasing the loan with the bank.
June 6
Flower arrangement services worth $7,800 were provided by Penny and her team to
the Adelaide Convention Centre on credit. Terms and conditions required full
payment within 30 days.
June 15
Penny sent a bouquet of flowers to her sister for her birthday. These flowers had
cost the business $175.
June 16
An Electricity Bill for $1,290 was paid for in cash.
June 17
Penny celebrated her Sister’s birthday by taking her to Lunch at the Magill Estate.
The cost of $245 was paid for by Penny using her own credit card.
June 24
The business received $3,900 from the debtor relating to the transaction on June 6.
June 30
The business received an Advertising bill for $1,250 for newspaper advertisments
taken out during the month. Terms were for full payment within 14 days.
REQUIRED:
a.
Prepare the General Journal entries where required to record each transaction. Include a
narration (explanation) for each journal entry.
(15 marks)
b.
Post the journals from (a) above to the General Ledgers provided, ensuring a balance for
each ledger is included.
(13 marks)
c.
Complete the attached Adjusted Trial Balance provided for the account balances calculated
in the General Ledger from (b) above.
(7 marks)
a.
Prepare the General Journal entries where required to record each transaction. Include a
narration (explanation) for each journal entry.
Date
Details
Debit ($)
Credit ($)
b.
Post the journals from (a) above to the General Ledger provided. All ledgers below must be
footed.
Cash at Bank
June 1
Balance
16 928
Accounts Receivable
June 1
Balance
15 785
Equipment
June 1
Balance
70 245
Inventory
June 1
Balance
20 225
Drawings – AFS
June 1
Balance
36 480
Loan
June 1
Balance
45 355
June 1
Balance
418 100
Balance
450
Sales
Advertising Expense
June 1
Balance
25 410
Advertising Payable
June 1
Electricity Expense
June 1
Balance
6 366
c. Complete the attached Adjusted Trial Balance provided. Please total both the debit and credit
column on completion.
AFS
ADJUSTED TRIAL BALANCE
AS AT 30 JUNE 2017
Debit ($)
Cash at Bank
Accounts Receivable
Inventory
Prepaid Insurance
Office Supplies on hand
Furniture & Fittings
Accumulated Depreciation – Furniture
& Fittings
Equipment
Accumulated Depreciation –
Equipment
Accounts Payable
Loan Payable
Advertising Payable
Penny’s AFS – Capital
Penny’s AFS – Drawings
Sales Revenue
Sales Returns and Allowances
Cost of Sales
Discount received
Freight inwards
Sales Salary Expense
Delivery Expense
Advertising Expense
Rent Expense
Office Salaries Expense
Electricity Expense
Discount Allowed
Totals
Credit ($)
5 514
2 676
51 030
12 634
18 120
25 327
53 580
10 010
162 308
13 096
7 920
66 936
19 692
27 148
35 150
6 839
…
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