Topic C06: The Accounting Cycle
Topic Overview p. 1
Topic Overview
Topic
BAFS Compulsory Part - Introduction to Accounting
C06: The Accounting Cycle
Level
S4
Duration
3 lessons (40 minutes per lesson)
Learning Objectives:
1.
2.
To reinforce the concept of the double entry accounting system; and
To reinforce accounting knowledge such as recording transactions in books of
original entry, posting entries to ledger accounts and preparing trial balance,
income statement and balance sheet.
Overview of Contents:
Lesson 1
Lesson 2
Lesson 3
Double Entry System and Books of Original Entry
Ledgers
Trial Balance and Financial Statements
Resources:
„
„
„
Topic Overview and Teaching Plan
Power Point Presentation
Student Worksheet with Answer
Suggested Activity:
„
Practical exercise
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Topic Overview p. 2
Lesson 1
Theme
Double Entry System and Books of Original Entry
Duration
40 minutes
Expected Learning Outcomes:
Upon completion of this lesson, students will be able to:
1.
2.
Apply the principles of double entry for the recording of business transactions;
and
Record transactions in books of original entry.
Teaching Sequence and Time Allocation:
Activities
Reference
Time
Allocation
PPT#2
2 minutes
Part I: Introduction
—
Teacher introduces the lesson by informing the class.
that they are going to prepare a set of accounts for
Beauty Full Co.
Part II: Content
—
—
—
Teacher reviews the basic steps of the accounting cycle.
PPT#3
Teacher reviews the double entry accounting system
PPT#4-36
and goes through the rules of double entry for different
types of accounts.
Teacher explains the steps of journalising transactions
PPT#37
15 minutes
and reviews the six books of original entry.
(Note: Owing to time constraint, teacher may skip
this part if students are familiar with the concepts, or
teacher may ask students to review the concepts before
the lesson.)
—
Activity : Practice Set
„ Students are required to open a general journal to
record the assets, liabilities and capital of Beauty
Full Co.
„ Teacher checks answers with the class.
—
Activity : Practice Set
„ Students are required to record credit sales
PPT#41-44 7 minutes
transactions in the sales journal and sales returns in Student
PPT#38-40
Student
7 minutes
Worksheet
p.28-30
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
„
—
Topic Overview p. 3
the returns inward journal.
Teacher checks answers with the class.
Worksheet
pp.31-32
Activity : Practice Set
PPT#45-48
„ Students are required to record credit purchases
Student
transactions in the purchases journal and purchases
7 minutes
Worksheet
returns in the returns outwards journal.
pp.33-34
„ Teacher checks answers with the class.
Part III: Conclusion
—
Teacher concludes the lesson by reviewing key points
covered in this lesson.
2 minutes
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Topic Overview p. 4
Lesson 2
Theme
Ledgers
Duration
40 minutes
Expected Learning Outcomes:
Upon completion of this lesson, students will be able to:
1.
2.
Set up ledger accounts; and
Post transactions from the books of original entry to the respective ledger
accounts.
Teaching Sequence and Time Allocation:
Activities
Reference
Time
Allocation
Part I: Introduction
—
Teacher reviews the progress of the accounting process
for Beauty Full Co.
2 minutes
Part II: Content
—
Activity : Practice Set
„ Students are required to record other transactions
in the general journal and/or the cash book.
„ Teacher checks answers with the class.
—
Teacher explains the commonly used ledgers and what
they are used for.
—
Activity : Practice Set
„ Students are required to set up general ledger,
PPT#58-68
accounts receivable ledger and accounts payable
Student
24 minutes
ledger accounts.
Worksheet
„ Students are then required to post entries from the pp.36-51
books of original entry to the respective ledger
accounts.
„ Teacher checks answers with the class.
PPT#49-57
Student
Worksheet 12 minutes
pp.28-30
& 35
Part III: Conclusion
—
Teacher concludes the session by reviewing the key
points covered in this lesson.
2 minutes
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Topic Overview p. 5
Lesson 3
Theme
Trial Balance and Financial Statements
Duration
40 minutes
Expected Learning Outcomes:
Upon completion of this lesson, students will be able to:
1.
2.
3.
4.
5.
Balance off ledger accounts at month end;
Explain what a trial balance is and the uses of it;
Prepare a trial balance;
Prepare an income statement; and
Prepare a balance sheet.
Teaching Sequence and Time Allocation:
Activities
Reference
Time
Allocation
PPT#69
2 minutes
Part I: Introduction
—
Teacher starts by telling students the uses of trial
balance.
Part II: Content
—
Teacher explains the procedure of preparing a trial
balance.
—
Activity : Practice Set
„ Students are required to balance off the ledgers
and cash book accounts and prepare the trial
balance of Beauty Full Co.
„ Teacher checks answers with the class.
—
Teacher explains what income statement and balance
sheet of a company are and shows how they are
prepared based on the trial balance.
Teacher describes the format of a vertical style income
statement.
—
—
Activity : Practice Set
„ Students are required to draw up the income
statement of Beauty Full Co.
„ Teacher checks answers with the class.
PPT#70-72
Student
15 minutes
Worksheet
p.52
PPT#73
PPT#74
10 minutes
Student
Worksheet
p.53
PPT#75
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Topic Overview p. 6
—
Teacher describes the format of a vertical style balance
sheet.
—
Activity : Practice Set
„ Students are required to draw up the balance sheet
of Beauty Full Co.
„ Teacher checks answers with the class.
PPT#76
Student
Worksheet
10 minutes
p.54
PPT#77
Part III: Conclusion
—
Teacher concludes the session by highlighting the
importance of accounting.
PPT#78
3 minutes
BAFS Learning and Teaching Example
As at April 2009
BAFS Compulsory Part
Introduction to Accounting
Beauty Full Co.
Topic C06:
The Accounting Cycle
Technology Education Section
Curriculum Development Institute
Education Bureau, HKSARG
April 2009
1
Topic C06
The Accounting Cycle
Introduction
2
BAFS Compulsory Part
Learning and Teaching Example
Lesson 1
This session aims to reinforce students’ understanding of the accounting
cycle through preparing a set of accounts for a sole proprietorship.
Students will work through different steps in the accounting cycle.
Start the lesson by telling the class that they are required to prepare a
set of accounts for a sole proprietorship called Beauty Full Co. The
materials are contained in the Student Worksheet.
Duration
Ask students to read the background information of Beauty Full Co. on
Student Worksheet p.2.
Three 40-minute lessons
Contents
Lesson 1 – Double Entry System and Books of Original Entry
Lesson 2 – Ledgers
Lesson 3 – Trial Balance and Financial Statements
1
2
The Accounting Cycle
Source Documents
z
Evidence of transactions, including:
z
z
z
z
z
Topic C06
The Accounting Cycle
3
BAFS Compulsory Part
Learning and Teaching Example
Sales and purchases invoices
Debit and credit notes
Bank statements
Copies of cheques issued and recieved
Cash vouchers
Topic C06
The Accounting Cycle
Before moving on to the accounting practice set, recap the major steps of
the accounting cycle.
4
BAFS Compulsory Part
Learning and Teaching Example
Have students check the practice set of the source documents which
includes:
1. Bank statement for the month of July of Year 1;
2. Copy of seven cheques issued by Beauty Full Co;
3. Copy of four cheques drawn at different banks received and paid by
Beauty Full Co;
4. Two cash vouchers;
5. Eight sales invoices;
6. Seven purchase invoices;
7. Two credit notes; and
8. One debit note.
3
4
Double Entry System:
Assets, Liabilities and Capital
Example
Types of
accounts
Examples
To record
Entry in the
account
Assets
Premises, van, fixtures,
stock, cash, cash in
bank, accounts
receivable, etc.
An increase
A decrease
Debit
Credit
Capital
Owner’s capital
An increase
A decrease
Credit
Debit
Liabilities
Accounts payable, bank
loan, etc.
An increase
A decrease
Credit
Debit
Topic C06
The Accounting Cycle
5
z
BAFS Compulsory Part
Learning and Teaching Example
On July 2 of Year 1, BF Co. purchased a
van for $50,000 in cash.
Accounts
Types of
Accounts
Increase /
decrease
Entry in the
account
Van
Asset
Increase
Debit
Cash
Asset
Decrease
Credit
Topic C06
The Accounting Cycle
6
BAFS Compulsory Part
Learning and Teaching Example
Before we move on, let’s have a quick review on the double entry system.
Firstly, make sure students are able to identify different types of accounts,
namely, assets, capital, liabilities, stocks, revenue or expenses.
Then, explain the rules of double entry for assets, capital and liabilities.
See next 4 slides for examples.
5
6
Example
Example
z
Van
Year 1
July 1
Cash
$
50,000
Cash
Year 1
July 1
Topic C06
The Accounting Cycle
7
Van
$
50,000
BAFS Compulsory Part
Learning and Teaching Example
On July 15 of Year 1, BF Co. bought
fixtures for $30,000 from BD Ltd on credit.
Accounts
Types of
Accounts
Increase /
decrease
Entry in the
account
Fixtures
?
?
?
BD Ltd
?
?
?
Topic C06
The Accounting Cycle
Using T-accounts to illustrate the entries.
8
BAFS Compulsory Part
Learning and Teaching Example
Ask the class to fill in the blanks.
See next slide for the answer.
7
8
Answer
z
Example
On July 15 of Year 1, BF Co. bought
fixtures for $30,000 from BD Ltd on credit.
$
Year 1
July
Accounts
Types of
Accounts
Increase /
decrease
Entry in the
account
Fixtures
Asset
Increase
Debit
BD Ltd
Liability
Increase
Credit
$
Year 1
July
Topic C06
The Accounting Cycle
9
BAFS Compulsory Part
Learning and Teaching Example
$
Year 1
July
Topic C06
The Accounting Cycle
Year 1
$
July
10
BAFS Compulsory Part
Learning and Teaching Example
Ask the class to name the T-accounts and input the correct entries.
See next slide for the answer.
9
10
Double Entry System:
Stocks
Answer
Types of
accounts
Fixtures
Year 1
July 15 BD Ltd
$
30,000
$
Year 1
July
Purchases
Sales
BD Ltd
Year 1
$
July
Year 1
$
July 15 Fixtures 30,000
Returns inwards
Returns outwards
Topic C06
The Accounting Cycle
11
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
To record
An increase
A decrease
An increase
A decrease
An increase
A decrease
An increase
A decrease
12
Entry in the
account
Debit
Credit
Credit
Debit
Debit
Credit
Credit
Debit
BAFS Compulsory Part
Learning and Teaching Example
Explain to the class the rules of double entry for the treatment of stocks.
See next 8 slides for examples.
11
12
Example
z
Example
On July 8 of Year 1, BF Co. sold goods for
$10,000 to M Chan on credit.
M Chan
Year 1
July 8
Accounts
Types of
Accounts
Increase /
decrease
Entry in the
account
M Chan
Asset
Increase
Debit
Sales
Sales
Increase
Credit
Sales
$
10,000
Sales
Year 1
Topic C06
The Accounting Cycle
13
July 8 M Chan
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
14
$
10,000
BAFS Compulsory Part
Learning and Teaching Example
Using T-accounts to illustrate the entries.
13
14
Example
z
Example
On July 22 of Year 1, M Chan refunded
goods he bought for $1,000.
Returns Inwards
Year 1
July 22 M Chan
Accounts
Types of
Accounts
Increase /
decrease
Entry in the
account
Returns
Inwards
Returns
Inwards
Increase
Debit
M Chan
Topic C06
The Accounting Cycle
$
1,000
M Chan
$
Year 1
Asset
Decrease
15
July 22 Returns
Inwards
Credit
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
16
1,000
BAFS Compulsory Part
Learning and Teaching Example
Using T-accounts to illustrate the entries.
15
16
Example
z
Answer
On July 6 of Year 1, BF Co. purchased
goods for $9,000 from F Li on credit.
Accounts
Types of
Accounts
Increase /
decrease
Entry in the
account
Purchases
?
?
?
F Li
?
?
?
Topic C06
The Accounting Cycle
17
z
On July 6 of Year 1, BF Co. purchased
goods for $9,000 from F Li on credit.
Accounts
Types of
Accounts
Purchases Purchases
F Li
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
Liability
18
Increase /
decrease
Entry in the
account
Increase
Debit
Increase
Credit
BAFS Compulsory Part
Learning and Teaching Example
Ask the class to fill in the blanks.
See next slide for the answer.
17
18
Example
Answer
Purchases
$
Year 1
July
$
Year 1
$
Year 1
9,000 July
Year 1
July
July 6 F Li
$
F Li
$
Year
July
Topic C06
The Accounting Cycle
$
Year 1
19
$
Year 1
July
July
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
20
Year 1
July 6 Purchases
$
9,000
BAFS Compulsory Part
Learning and Teaching Example
Ask the class to name the T-accounts and input the correct entries.
See next slide for the answer.
19
20
Example
z
Answer
On July 27 of Year 1, BF Co. returned
goods previously bought from F Li for
$800.
z
On July 27 of Year 1, BF Co. returned
goods previously bought from F Li for
$800.
Accounts
Types of
Accounts
Increase /
decrease
Entry in the
account
Accounts
Types of
Accounts
Increase /
decrease
Entry in the
account
F Li
?
?
?
F Li
Liability
Decrease
Debit
Returns
Outwards
?
?
?
Returns
Outwards
Returns
outwards
Increase
Credit
Topic C06
The Accounting Cycle
21
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
22
BAFS Compulsory Part
Learning and Teaching Example
Ask the class to fill in the blanks.
See next slide for the answer.
21
22
Example
Answer
F Li
$
Year 1
July
$
Year 1
$
Year 1
July
July 27 Returns
Outwards
$
Year 1
July
800
Returns outwards
$
Year 1
July
Topic C06
The Accounting Cycle
$
Year 1
23
$
Year 1
July
July
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
Year 1
July 27 F Li
24
$
800
BAFS Compulsory Part
Learning and Teaching Example
Ask the class to name the T-accounts and input the correct entries.
See next slide for the answer.
23
24
Double Entry System:
Revenue and Expenses
Example
Types of
Accounts
Examples
To record
Entry in the
account
Revenue
Commission
received, etc.
An increase
A decrease
Credit
Debit
Expense
Rent,
government
rates, motor
expense, salary,
etc.
Topic C06
The Accounting Cycle
An increase
A decrease
25
z
Debit
Credit
BAFS Compulsory Part
Learning and Teaching Example
On 28 July of Year 1, BF Co. paid motor
expenses for $3,500 by cheque.
Accounts
Types of
Accounts
Increase /
decrease
Entry in the
account
Motor
Expenses
Expense
Increase
Debit
Bank
Asset
Decrease
Credit
Topic C06
The Accounting Cycle
26
BAFS Compulsory Part
Learning and Teaching Example
Explain to the class the rules of double entry for revenue and expenses.
See next 4 slides for examples.
25
26
Example
Example
z
Motor Expenses
Year 1
July 28
Bank
$
3,500
Accounts
Types of
Accounts
Increase /
decrease
Entry in the
account
?
?
?
$
Rent
Expenses
3,500
Cash
?
?
?
Bank
Year 1
July 28 Motor
expenses
Topic C06
The Accounting Cycle
27
On July 3 of Year 1, BF Co. paid rent
expenses for $15,300 by cash.
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
Using T-accounts to illustrate the entries.
28
BAFS Compulsory Part
Learning and Teaching Example
Ask the class to fill in the blanks.
See next slide for answer.
27
28
Answer
z
Example
On July 3 of Year 1, BF Co. paid rent
expenses for $15,300 by cash.
$
Year 1
July
Accounts
Types of
Accounts
Increase /
decrease
Entry in the
account
Rent
Expenses
Expense
Increase
Debit
Cash
Topic C06
The Accounting Cycle
$
Year 1
Asset
Decrease
29
July
Credit
BAFS Compulsory Part
Learning and Teaching Example
$
Year 1
July
Topic C06
The Accounting Cycle
$
Year 1
July
30
BAFS Compulsory Part
Learning and Teaching Example
Ask the class to name the T-accounts and input the correct entries.
See next slide for the answer.
29
30
Double Entry System:
Drawings
Answer
Rent expense
$
Year 1
15,300 July
Year 1
July 3 Cash
$
Type of
Account
To record
Entry in the
account
Drawings
An increase
A decrease
Debit
Credit
Cash
$
Year 1
July
Topic C06
The Accounting Cycle
$
Year 1
July 3 Rent
Expense
31
15,300
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
32
BAFS Compulsory Part
Learning and Teaching Example
Explain the rules of double entry for sole proprietor’s drawings.
See next 4 slides for example.
31
32
Example
z
Example
On July 20 of Year 1, owner of BF Co.
drew cash for $5,000.
Drawings
Year 1
July 20 Cash
Accounts
Types of
Accounts
Increase /
decrease
Entry in the
account
Drawings
Drawings
Increase
Debit
Cash
Asset
Decrease
Credit
Topic C06
The Accounting Cycle
33
$
5,000
Cash
Year 1
July 20 Drawings
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
34
$
5,000
BAFS Compulsory Part
Learning and Teaching Example
Using T-accounts to illustrate the entries.
33
34
Example
z
Example
On July 28 of Year 1, owner of BF Co.
took away goods of $3,000.
Accounts
Types of
Accounts
Increase /
decrease
Entry in the
account
Drawings
Drawings
Increase
Debit
Purchases
Purchases
Decrease
Credit
Topic C06
The Accounting Cycle
35
Drawings
$
July 28 Purchases 3,000
Year 1
Purchases
Year 1
July 28 Drawings
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
36
$
3,000
BAFS Compulsory Part
Learning and Teaching Example
Using T-accounts to illustrate the entries.
35
36
Journalise Transactions
z
z
Open the Books
Transactions are classified and entered
into books of original entry.
Books of original entry include:
z
z
z
z
z
z
z
Sales journal
Purchase journal
Returns inwards journal
Returns outwards journal
Cash book
General journal
Topic C06
The Accounting Cycle
37
BAFS Compulsory Part
Learning and Teaching Example
Open a general journal to record the
assets, liabilities and capital of Beauty Full
Co based on the background information
given.
Topic C06
The Accounting Cycle
Review original entry in books and explain how to journalise transactions.
Transactions are first recorded, or journalised, according to the original
entry in books. Original entry, credit sales are recorded in the sales journal.
Credit purchases are recorded in the purchases journal, etc. These entries
then can be posted to respective ledger accounts based on double entry
rules.
38
BAFS Compulsory Part
Learning and Teaching Example
Ask students to open and record the assets, liabilities and capital of Beauty
Full Co in the general journal.
See next slide for example.
37
38
Example
Topic C06
The Accounting Cycle
39
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
40
BAFS Compulsory Part
Learning and Teaching Example
Teacher can invite a volunteer to show his/her entries to the class for
checking.
39
40
Sales Journals
z
Record credit sales transactions in the
sales journal.
Topic C06
The Accounting Cycle
41
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
Ask students to record credit sales transactions in the sales journal.
42
BAFS Compulsory Part
Learning and Teaching Example
Teacher can invite a volunteer to show his/her entries to the class for
checking.
There are eight credit sales transactions with invoices from no. 103362 to
103369.
41
42
Returns Inwards Journal
z
Record the sales returns to the returns
inwards journal.
Topic C06
The Accounting Cycle
43
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
Ask students to record the sales returns in the returns inwards journal.
There are two credit notes evidencing sales returns from Francis Au and
Rose Ltd.
44
BAFS Compulsory Part
Learning and Teaching Example
Teacher can invite a volunteer to show his/her entries to the class for
checking.
43
44
Purchase Journal
z
Record credit purchases transactions in
the purchases journal.
Topic C06
The Accounting Cycle
45
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
Ask students to record credit purchases transactions in the purchases
journal.
46
BAFS Compulsory Part
Learning and Teaching Example
Teacher can invite a volunteer to show his/her entries to the class for
checking.
There are six purchase transactions with different suppliers.
45
46
Returns Outwards Journal
z
Record the purchases returns to the
returns outwards journal.
Topic C06
The Accounting Cycle
47
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
Ask students to record the purchases returns in the returns outwards journal.
A debit note for the purchases returns has been sent to Billy Woo.
48
BAFS Compulsory Part
Learning and Teaching Example
Teacher can invite a volunteer to show his/her entries to the class for
checking.
End of Lesson 1
47
48
General Journal & Cash Book
z
Example – Rent Payment
Make use of the bank statement,
copies of cheques issued and
received, cash vouchers and
invoice and record the respective
transactions in the general journal
and cash book.
Topic C06
The Accounting Cycle
49
To record an
increase in expense,
entry made in the
debit side
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
Lesson 2
To record a decrease
in asset (bank balance),
entry50 made in the credit side BAFS Compulsory Part
Learning and Teaching Example
Show how to record the rent payment in the general journal and the cash
book (see next slide).
Ask the class to record transactions other than sales, returns inwards,
purchases and returns outwards in the general journal or the cash book
based on the information from the bank statement, copies of cheques, cash
vouchers and invoices.
See next 4 slides for examples.
49
50
Example – Rent Payment
Example – Debtor Repayment
5% cash discount if paid
within 60 days
Also record the payment
by cheque on the right-hand
side (credit) of the cash book
Topic C06
The Accounting Cycle
51
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
52
BAFS Compulsory Part
Learning and Teaching Example
Show how to record a debtor repayment in the general journal and cash
book (see next slide).
Tell students to be careful with the handling of the 5% cash discount for
sales if paid within 60 days.
Check the answers with the class.
51
52
Example – Debtor Repayment
Example – Creditor Settlement
5% cash discount if paid
within 60 days
Topic C06
The Accounting Cycle
53
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
Entry made in the cash book.
54
BAFS Compulsory Part
Learning and Teaching Example
Show how to record a payment to creditor in the general journal and cash
book (see next slide).
Tell students to be careful with the handling of the 5% cash discount for
purchases if paid within 60 days.
Check the answers with the class.
53
54
Example – Creditor Settlement
Topic C06
The Accounting Cycle
55
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
Entry made in the cash book.
56
BAFS Compulsory Part
Learning and Teaching Example
Check the answers with students after they have finished recording the
transactions in the general journal and cash book (see next slide).
55
56
Post Entries to Ledger
Accounts
z
Set up the following ledger accounts for
Beauty Full Co:
z
z
z
Topic C06
The Accounting Cycle
57
BAFS Compulsory Part
Learning and Teaching Example
General ledger
Accounts receivable ledger
Accounts payable ledger
Topic C06
The Accounting Cycle
58
BAFS Compulsory Part
Learning and Teaching Example
Ask students to set up ledger accounts for Beauty Full Co, including the
general, accounts receivable and accounts payable ledgers. Based on the
journal entries completed earlier, ask students to post entries to the
respective ledger accounts.
See following slides for examples.
57
58
Example
– Posting to General Ledger
Example – Posting to Accounts
Receivable Ledger
Topic C06
The Accounting Cycle
Topic C06
The Accounting Cycle
59
BAFS Compulsory Part
Learning and Teaching Example
Example of posting the entry of premises from the general journal to the
premises account in the general ledger.
60
BAFS Compulsory Part
Learning and Teaching Example
Example of posting the entry of debtor from the general journal to the
corresponding accounts receivable ledger account.
59
60
Example – Posting to Accounts
Payable Ledger
Example
– Posting to General Ledger
Posted to
cash book
Topic C06
The Accounting Cycle
61
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
Example of posting the entry of creditor from the general journal to the
corresponding accounts payable ledger account.
62
BAFS Compulsory Part
Learning and Teaching Example
Example of posting the entry of rent expense from the general journal to the
rent expense account in the general ledger. Note that the entry in the cash
book should have been input already.
61
62
Example
– Posting to General Ledger
Example – Posting to Accounts
Receivable Ledger
①
Topic C06
The Accounting Cycle
②
63
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
Example of posting the entry of credit sales from the sales journal to the
sales account in the general ledger. The posting to the account receivable
ledger is shown on the next slide.
64
BAFS Compulsory Part
Learning and Teaching Example
Example of posting the entry of credit sales from the sales journal to the
accounts receivable ledger account.
63
64
Example – Posting to Accounts
Receivable Ledger
Example – Posting to Accounts
Payable Ledger
Post to cash book
Post to cash sales
discount account
Topic C06
The Accounting Cycle
65
①
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
Example of posting the entry of repayment from the general journal to the
corresponding accounts receivable ledger account. Note that the other two
postings to cash book and cash sales discount account are not shown here.
66
BAFS Compulsory Part
Learning and Teaching Example
Example of posting the entry of credit purchases from the purchases journal
to the general ledger purchases account. The posting to the account
payable ledger is shown on the next slide.
65
66
Example – Posting to Accounts
Payable Ledger
Example – Posting to Accounts
Payable Ledger
Post to cash
purchases
discount account
②
Topic C06
The Accounting Cycle
Post to cash book
67
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
Example of posting the entry of credit purchases from the purchases journal
to the accounts payable ledger account.
68
BAFS Compulsory Part
Learning and Teaching Example
Example of posting the entry of settlement from the general journal to the
corresponding accounts payable ledger account. Note that the other two
postings to cash book and cash purchases discount account are not shown
here.
End of Lesson 2
67
68
Steps to Prepare Trial
Balance
Uses of Trial Balance
z
Checking the accuracy of double entry records:
z
z
z
z
z
Under the double entry system, total debit balances
and total credit balances are equal.
If they are not equal, it means error(s) have been
made.
There could still be errors even if trial balance
balances.
z
z
Used as a basis for preparing the income
statement and the balance sheet.
z
Topic C06
The Accounting Cycle
69
BAFS Compulsory Part
Learning and Teaching Example
Balance off all the ledger accounts and the
cash book.
List all balances, either debit or credit, of
all accounts in the trial balance separately.
Add up all the debit and credit balances
correspondingly and check whether the
totals of debit side and credit side are
equal.
Check for errors if they are not equal.
Topic C06
The Accounting Cycle
Lesson 3
70
BAFS Compulsory Part
Learning and Teaching Example
Ask students to balance off all the ledger accounts and the cash book, write
down the debit balances and the credit balances of all accounts in the trial
balance sheet (see next slide for example). Then add up all the debit and
credit balances correspondingly and check whether the totals even out. Ask
them to check for errors if they are not equal.
Explain the uses of trial balance.
Point out that even the trial balance balances, there could still be errors. For
example, $12,000 was recorded as $1,200 on both debit and credit entries,
correction should be made if errors are found.
69
70
Balance Off an Account
Input $400,000 to the
credit side of the
Premises account to
balance it off. The
balance is then transfer
to next month.
Topic C06
The Accounting Cycle
71
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
Example of balancing off the premises account and the posting of it to the
trial balance.
72
BAFS Compulsory Part
Learning and Teaching Example
Check the answers with the class.
71
72
Prepare Financial
Statements
z
Income Statement
Two most important financial statements
are:
z
z
Sales
Sales
Less
Income statement
Balance sheet
Topic C06
The Accounting Cycle
BAFS Compulsory Part
Learning and Teaching Example
Add
Other
Other incomes
incomes
Less
Expenses
Expenses
List
Listall
allexpenses
expenses
=
Net
Net Profit
Profit
Topic C06
The Accounting Cycle
Remind students that based on the trial balance, the two most important
financial statements, i.e. income statement and balance sheet can be
prepared.
Cost
Cost of
of good
good sold
sold
Calculate
Calculatefrom
fromopening
opening
stock,
stock,purchase,
purchase,cash
cash
Purchase
Purchasediscount,
discount,
Returns
Returnsoutwards
outwards&&
closing
closingstock
stock
=
73
Less
Lesscash
cashsales
salesdiscount
discount
&&returns
returnsinwards
inwards
Gross
Gross profit
profit
74
BAFS Compulsory Part
Learning and Teaching Example
Describe the format of a vertical style income statement and ask the class
to create an income statement of Beauty Full Co for the month of July in
Year 1.
73
74
Balance Sheet
Fixed
Fixed Assets
Assets
+
Current
Current Assets
Assets
Topic C06
The Accounting Cycle
75
Net
Net Current
Current
Assets
Assets
Less
Less Current
Current Liabilities
Liabilities
Long-term Liabilities
Long
Long-term
Liabilities
=
Financed
Financed by:
by:
Capital
Capital
BAFS Compulsory Part
Learning and Teaching Example
Topic C06
The Accounting Cycle
Check the answers with the class.
76
BAFS Compulsory Part
Learning and Teaching Example
Briefly explain the format of the vertical style balance sheet and ask the
class to create a balance sheet for Beauty Full Co as at July 31 of Year 1.
75
76
Conclusions
z
Accounting helps us to
z
z
z
z
z
Topic C06
The Accounting Cycle
77
BAFS Compulsory Part
Learning and Teaching Example
Record, classify and summarise data
Communicate information
Calculate profit and loss
Have a better control of the financial
resources
Enhance effective operations
Topic C06
The Accounting Cycle
Check the answers with the class.
78
BAFS Compulsory Part
Learning and Teaching Example
Conclude the lesson by highlighting the importance and significance of
accounting.
77
78
The End
Topic C06
The Accounting Cycle
79
BAFS Compulsory Part
Learning and Teaching Example
End of Lesson 3
79
Topic C06: The Accounting Cycle
Student Worksheet p. 1
BAFS Compulsory Part - Introduction to Accounting
Topic C06: The Accounting Cycle
Beauty Full Co
An Accounting
Practice Set
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 2
Beauty Full Co
Background
Mr Bobby Fu, a sole proprietor, started his own business “Beauty Full Co” on June 1
of Year 1. He has little knowledge of accounting. His accounting records are kept on a
single entry basis. The balances as at July 1 of Year 1 are extracted as follows:
Assets:
Premises $400,000; van $90,000; fixtures $120,000; stock $257,800;
Bank $250,800; cash in hand $9,000
Debtors: Alan Fung $8,000; Candy Chan $36,000
Liabilities:
Creditors: Thomas Liu $12,000; Mandy Hui $40,000
He decides to keep a double entry accounting record starting from July 1 of Year 1.
You are required to open the books via the journal to record assets, liabilities, and
capital, and then record the daily transactions for the month of July in the books of
original entry and the ledgers. A trial balance and financial statements need to be
prepared as at 31 July of Year 1.
Note:
Inventory as at 31 July of Year 1 is $270,000.
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 3
基滙銀行有限公司
STATEMENT OF ACCOUNT WITH
BIZ BANK LIMITED
月結單
分行
Branch:
賬戶號碼
Central
Account No.:
012-455-467861-003
Beauty Full Company
日期
摘要
存入金額(CR) / 支出金額
港幣結餘
Date
Details
Deposit (CR) / Withdrawals
Balance in HK Dollars
Year 1
July
1
Balance brought forward
1
801211
3,000
247,800 CR
16
Deposit
7,600 CR
255,400 CR
Deposit
41,800 CR
297,200 CR
Deposit
7,600 CR
304,800 CR
Deposit
15,200 CR
320,000 CR
801212
15,200
304,800 CR
801213
38,000
266,800 CR
801214
11,400
255,400 CR
801215
11,200
244,200 CR
801216
13,200
231,000 CR
801217
60,000
171,000 CR
24
存入
Deposits:
結餘
72,200
支出
Withdrawals:
250,800 CR
152,000
Balance: 171,000 CR
其他賬戶結餘列入
透支
Other net balances
Overdraft = OD
交來票據收妥作實，倘有錯漏或更改地址時，請即通知往來存款部主任為荷。
E&OE
Local cheques etc. Although passed to credit are accepted for collection only and will not be available until cleared.
Any exception, error, or change of address should be promptly advised to the officer in change of Current
Accounts Department.
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 4
基滙銀行有限公司
Biz Bank Limited
Hong Kong SAR 香港特別行政區
1 July Year 1
Day 日
Pay
祈付 HANDSON PROPERTY
HK dollars
港幣
THREE THOUSAND ONLY
Month 月
Year 年
or bearer
或持票人
HK$3,000.--
BEAUTY FULL CO.
801211
012
455
467861
003
Note: Rent payment
基滙銀行有限公司
Biz Bank Limited
Hong Kong SAR 香港特別行政區
24 July Year 1
Day 日
Pay
祈付 MR THOMAS LIU
HK dollars
港幣
FIFTEEN THOUSAND AND TWO
HUNDRED ONLY
Month 月
Year 年
or bearer
或持票人
HK$15,200.--
BEAUTY FULL CO.
801212
012
455
467861
003
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 5
基滙銀行有限公司
Biz Bank Limited
Hong Kong SAR 香港特別行政區
24 July Year 1
Day 日
Pay
祈付 MS MANDY HUI
HK dollars
港幣
THIRTY EIGHT THOUSAND ONLY
Month 月
Year 年
or bearer
或持票人
HK$38,000.--
BEAUTY FULL CO.
801213
012
455
467861
003
基滙銀行有限公司
Biz Bank Limited
Hong Kong SAR 香港特別行政區
24 July Year 1
Day 日
Pay
祈付 MR BILLY WOO
HK dollars
港幣
ELEVEN THOUSAND AND FOUR
HUNDRED ONLY
Month 月
Year 年
or bearer
或持票人
HK$11,400.--
BEAUTY FULL CO.
801214
012
455
467861
003
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 6
基滙銀行有限公司
Biz Bank Limited
Hong Kong SAR 香港特別行政區
30 July Year 1
Day 日
Pay
祈付 MS AMY CHAN
HK dollars
港幣
ELEVEN THOUSAND AND TWO
Month 月
Year 年
or bearer
或持票人
HK$11,200.--
HUNDRED ONLY
BEAUTY FULL CO.
801215
012
455
467861
003
Note: Paid for salaries
基滙銀行有限公司
Biz Bank Limited
Hong Kong SAR 香港特別行政區
30 July Year 1
Day 日
Pay
祈付 HK SAR GOVERNMENT
HK dollars
港幣
THIRTEEN THOUSAND AND TWO
HUNDRED ONLY
Month 月
Year 年
or bearer
或持票人
HK$13,200.--
BEAUTY FULL CO.
801216
012
455
467861
003
Note: Government rates
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 7
基滙銀行有限公司
Biz Bank Limited
Hong Kong SAR 香港特別行政區
31 July Year 1
Day 日
Pay
祈付 EXCELLENT MOTORS
HK dollars
港幣
SIXTY THOUSAND ONLY
Month 月
Year 年
or bearer
或持票人
HK$60,000.--
BEAUTY FULL CO.
801217
012
455
467861
003
Note: Settlement – Purchase of car on credit on 14 July of Year 1.
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 8
Eastern Bank Limited
Hong Kong SAR
東方銀行有限公司
香港特別行政區
16/7/Year 1
Day 日
Pay
祈付 BEAUTY FULL CO,
HK dollars
港幣
SEVEN THOUSAND & SIX HUNDRED
ONLY
Month 月
Year 年
or bearer
或持票人
HK$7,600.--
MR ALAN FUNG
704532
001
345
003780
002
Southern Bank Limited
Hong Kong SAR
南方銀行有限公司
香港特別行政區
16/7/Year 1
Day 日
Pay
祈付 BEAUTY FULL CO,
HK dollars
港幣
FORTY ONE THOUSAND & EIGHT
HUNDRED ONLY
Month 月
Year 年
or bearer
或持票人
HK$41,800.--
MISS CANDY CHAN
354622
002
455
132046
008
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 9
Western Bank Limited
Hong Kong SAR
西方銀行有限公司
香港特別行政區
16/7/Year 1
Day 日
Pay
祈付 BEAUTY FULL CO,
HK dollars
港幣
SEVEN THOUSAND & SIX HUNDRED
ONLY
Month 月
Year 年
or bearer
或持票人
HK$7,600.--
MR FRANCIS AU
285546
005
431
265763
007
Northern Bank Limited
Hong Kong SAR
北方銀行有限公司
香港特別行政區
16/7/Year 1
Day 日
Pay
祈付 Beauty Full Co.
HK dollars
港幣
FIFTEEN THOUSAND & TWO
HUNDRED ONLY
Month 月
Year 年
or bearer
或持票人
HK$15,200.--
ROSE LTD
400055
022
354
467812
006
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 10
Beauty Full Co
Rm 1111, 24 Tin Tin Road
Kowloon
Tel.: 7633 1124
Item No
A001
Qty
280
Description
SALES INVOICE
Date: 3 July Year 1
Invoice No.: 103362
Customer: Francis Au
Unit Price
Pink Blouse
50
Discount
Total
20
$
11,200
Order Total Amount
$ 11,200
Terms: 5% cash discount if paid within 60 days
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 11
Beauty Full Co
Rm 1111, 24 Tin Tin Road
Kowloon
Tel.: 7633 1124
Item No
A117
Qty
400
SALES INVOICE
Date: 3 July Year 1
Invoice No.: 103363
Customer: Una Shum
Description
Unit Price
Earring
40
Discount
Total
2.5
$
15,600
Order Total Amount
$ 15,600
Terms: 5% cash discount if paid within 60 days
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 12
Beauty Full Co
Rm 1111, 24 Tin Tin Road
Kowloon
Tel.: 7633 1124
Item No
B006
Qty
490
Description
SALES INVOICE
Date: 5 July Year 1
Invoice No.: 103364
Customer: Rose Ltd
Unit Price
White Blouse
40
Discount
Total
0
$
19,600
Order Total Amount
$ 19,600
Terms: 5% cash discount if paid within 60 days
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 13
Beauty Full Co
Rm 1111, 24 Tin Tin Road
Kowloon
Tel.: 7633 1124
Item No
C007
Qty
30
Description
Yellow shirts
SALES INVOICE
Date: 6 July Year 1
Invoice No.: 103365
Customer: Lily Man
Unit Price
320
Discount
Total
0
$
9,600
Order Total Amount
$ 9,600
Terms: 5% cash discount if paid within 60 days
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 14
Beauty Full Co
Rm 1111, 24 Tin Tin Road
Kowloon
Tel.: 7633 1124
Item No
B034
Qty
590
SALES INVOICE
Date: 8 July Year 1
Invoice No.: 103366
Customer: Olivia Pau
Description
Unit Price
Suits
40
Discount
Total
0
$
23,600
Order Total Amount
$ 23,600
Terms: 5% cash discount if paid within 60 days
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 15
Beauty Full Co
Rm 1111, 24 Tin Tin Road
Kowloon
Tel.: 7633 1124
Item No
A115
Qty
1000
SALES INVOICE
Date: 8 July Year 1
Invoice No.: 103367
Customer: Candy Chan
Description
Red Shoes
Unit Price
100
Discount
Total
20
$
8,000
Order Total Amount
$ 8,000
Terms: 5% cash discount if paid within 60 days
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 16
Beauty Full Co
Rm 1111, 24 Tin Tin Road
Kowloon
Tel.: 7633 1124
Item No
B034
Qty
110
SALES INVOICE
Date: 9 July Year 1
Invoice No.: 103368
Customer: Una Shum
Description
Unit Price
Suits
50
Discount
Total
20
$
4,400
Order Total Amount
$ 4,400
Terms: 5% cash discount if paid within 60 days
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 17
Beauty Full Co
Rm 1111, 24 Tin Tin Road
Kowloon
Tel.: 7633 1124
Item No
D300
Qty
268
SALES INVOICE
Date: 9 July Year 1
Invoice No.: 103369
Customer: Queenie Chiu
Description
Unit Price
Necklace
50
Discount
Total
0
$
13,400
Order Total Amount
$ 13,400
Terms: 5% cash discount if paid within 60 days
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 18
Thomas Liu
30 Ng Fong Street, Kwai Chung
Invoice: 11700
Date: 2 July Year 1
To: Beauty Full Co
Rm 1111, 24 Tin Tin Road, Kowloon
Quantity
100
Description
Discount
“Roots” Sandals
%
20
Order
Unit price
Total
4810
$
50
$
4000
4000
Terms: 5% cash discount if paid within 60 days
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 19
Ellen Li
80 Kimberley Road, Tsimshatsui
Invoice No: 19-200
Date: 2 July Year 1
Customer:
Order
4910
Beauty Full Co
Rm 1111, 24, Tin Tin Road, Kowloon
Description
“Analyst” – T shirts
Quantity
Price/unit
Total
20
$
560
$
11200
11200
Terms: 5% cash discount if paid within 60 days
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 20
Denise Hung
7/F Kaiser Estate, Tokwawan
77 SHENG HEUNG ROAD, TOKWAWAN, KOWLOON
Invoice: 876 5432
Date: 2 July Year 1
QUANTITY DESCRIPTION DISCOUNT
200
“Barker”
Ladies Jean
%
5
ORDER
PRICE/UNIT
TOTAL
4813
$
40
$
7600
7600
Customer :
Beauty Full Co
Rm 1111, 24 Tin Tin Road, Kowloon
Terms: 5% cash discount if paid within 60 days
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 21
Billy Woo
30 Catherine Street, Kowloon
2 July Year 1
INVOICE X374
QUANTITY
69
DESCRIPTION
1009 Suits
ORDER
PRICE/UNIT
TOTAL
4809
$
200
$
13,800
13,800
Beauty Full Co
Rm 1111, 24 Tin Tin Road,
Kowloon
Terms: 5% cash discount if
paid within 60 days
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 22
Ellis Wang
30 Ng Fong Street, Kwai Chung
Invoice: 11700
Date 22 July Year 1
Beauty Full co
Rm 1111, 24 Tin Tin Road, Kowloon
Quantity
400
Description
“Cat” Sandals
Order
Unit price
Total
4821
$
44.50
$
17,800
17,800
Terms: 5% cash discount if paid
within 60 days
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 23
Ocean Co.
80 Kimberley Road, Tsimshatsui
Invoice No.: 19-200
22 July Year 1
Customer:
Order
4910
Beauty Full Co
Rm 1111, 24 Tin Tin Road, Kowloon
Description
“Cat” – T shirts
Quantity
Price/unit
Total
360
$
40
$
14,400
_______
Terms: 5% cash discount if paid
within 60 days
14,400
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 24
Beauty Full Co.
Rm 1111, 24 Tin Tin Road
Kowloon
11 July Year 1
To: Francis Au
334 Martha Road
Kowloon
Credit Note No. 4/01
80 Pink Blouses
Less: 20% trade discount
Per Unit
Total
$
50
10
$
4,000
800
3,200
Beauty Full Co.
Rm 1111, 24 Tin Tin Road
Kowloon
11 July Year 1
To: Rose Ltd
1 Lagune Road
Kowloon
Credit Note No. 334/01
90 White Blouses
Per Unit
Total
$
$
40
3,600
3,600
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 25
Beauty Full Co.
Rm 1111, 24 Tin Tin Road
Kowloon
19 July Year 1
To: Billy Woo,
30 Catherine Street,
Kowloon
Debit Note No. 3674/01
9 Suits
Per Unit
Total
$
$
200
1,800
1,800
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 26
No
Cash Voucher
Date
0211-01
4/7/Year 1
AMOUNT
For what required
$
Motor expenses
¢
2,600
2,600
Signature _______________________________________
Passed by ________________________
Cash Voucher
For what required
Drawings
No
Date
0212-01
7/7/Year 1
AMOUNT
$
¢
4,000
4,000
Signature _______________________________________
Passed by ________________________
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 27
Excellent Motors
22 Maple Street, Kowloon
Tel: 2366 5488
Invoice: 223/01
Date: 14 July Year 1
To: Beauty Full Co
Rm 1111, 24 Tin Tin Road, Kowloon
$
Motor Van
60,000
Payment Due Date: 31 August Year 1
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 28
GENERAL JOURNAL – JULY
Date
Year 1
Description
Page 1
Post.
Ref.
Debit
Credit
$
$
July
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 29
GENERAL JOURNAL – JULY
Date
Year 1
Description
Page 2
Post.
Ref.
Debit
Credit
$
$
July
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 30
GENERAL JOURNAL – JULY
Date
Year 1
Description
Page 3
Post.
Ref.
Debit
Credit
$
$
July
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 31
SALES JOURNAL – JULY
Date
Invoice
Number
Account Debited
Page 1
Post.
Ref.
Amount
Year 1
$
July
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 32
RETURNS INWARDS – JULY
Date
Invoice
Number
Account Credited
Page 1
Post.
Ref.
Amount
Year 1
$
July
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 33
PURCHASES JOURNAL – JULY
Date
Purchase
Order No.
Account Debited
Page 1
Post.
Ref.
Amount
Year 1
$
July
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 34
RETURNS OUTWARDS – JULY
Date
Purchase
Order No.
Account Debited
Page 1
Post.
Ref.
Amount
Year 1
$
July
BAFS Learning and Teaching Example
As at April 2009
To p ic
C06:
The
Accounting
Cycle
Student
Wo r k sh e e t
CASH BOOK – JULY
Date
Year 1
July
Description
Post.
Ref.
Discount
Cash
Bank
Date
$
$
$
Year 1
p.
35
Page 1
Description
Post.
Ref.
Discount
Cash
Bank
$
$
$
July
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 36
ACCOUNTS RECEIVABLE LEDGER
NAME
Page 1
ADDRESS
ACC. No.
Year 1
Explanation
Post.
Ref.
$
July
Year 1
Explanation
Post.
Ref.
$
July
NAME
Page 2
ADDRESS
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
Year 1
Explanation
Post.
Ref.
July
BAFS Learning and Teaching Example
As at April 2009
$
Topic C06: The Accounting Cycle
Student Worksheet p. 37
ACCOUNTS RECEIVABLE LEDGER
NAME
Page 3
ADDRESS
ACC. No.
Year 1
Explanation
Post.
Ref.
$
July
Year 1
Explanation
Post.
Ref.
$
July
NAME
Page 4
ADDRESS
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
Year 1
Explanation
Post.
Ref.
July
BAFS Learning and Teaching Example
As at April 2009
$
Topic C06: The Accounting Cycle
Student Worksheet p. 38
ACCOUNTS RECEIVABLE LEDGER
NAME
Page 5
ADDRESS
ACC. No.
Year 1
Explanation
Post.
Ref.
$
July
Year 1
Explanation
Post.
Ref.
$
July
NAME
Page 6
ADDRESS
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
Year 1
Explanation
Post.
Ref.
July
BAFS Learning and Teaching Example
As at April 2009
$
Topic C06: The Accounting Cycle
Student Worksheet p. 39
ACCOUNTS RECEIVABLE LEDGER
NAME
Page 7
ADDRESS
ACC. No.
Year 1
Explanation
Post.
Ref.
$
July
Year 1
Explanation
Post.
Ref.
$
July
NAME
Page 8
ADDRESS
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
Year 1
Explanation
Post.
Ref.
July
BAFS Learning and Teaching Example
As at April 2009
$
Topic C06: The Accounting Cycle
Student Worksheet p. 40
ACCOUNTS PAYABLE LEDGER
NAME
Page 1
ADDRESS
ACC. No.
Year 1
Explanation
Post.
Ref.
$
July
Year 1
Explanation
Post.
Ref.
$
July
NAME
Page 2
ADDRESS
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
Year 1
Explanation
Post.
Ref.
July
BAFS Learning and Teaching Example
As at April 2009
$
Topic C06: The Accounting Cycle
Student Worksheet p. 41
ACCOUNTS PAYABLE LEDGER
NAME
Page 3
ADDRESS
ACC. No.
Year 1
Explanation
Post.
Ref.
$
July
Year 1
Explanation
Post.
Ref.
$
July
NAME
Page 4
ADDRESS
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
Year 1
Explanation
Post.
Ref.
July
BAFS Learning and Teaching Example
As at April 2009
$
Topic C06: The Accounting Cycle
Student Worksheet p. 42
ACCOUNTS PAYABLE LEDGER
NAME
Page 5
ADDRESS
ACC. No.
Year 1
Explanation
Post.
Ref.
$
July
Year 1
Explanation
Post.
Ref.
$
July
NAME
Page 6
ADDRESS
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
Year 1
Explanation
Post.
Ref.
July
BAFS Learning and Teaching Example
As at April 2009
$
Topic C06: The Accounting Cycle
Student Worksheet p. 43
ACCOUNTS PAYABLE LEDGER
NAME
Page 7
ADDRESS
ACC. No.
Year 1
Explanation
Post.
Ref.
$
July
Year 1
Explanation
Post.
Ref.
$
July
NAME
Page 8
ADDRESS
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
Year 1
Explanation
Post.
Ref.
July
BAFS Learning and Teaching Example
As at April 2009
$
Topic C06: The Accounting Cycle
Student Worksheet p. 44
GENERAL LEDGER
NAME
Page 1
ACC. No.
Year 1
Explanation
Post.
Ref.
$
July
Year 1
Explanation
Post.
Ref.
$
July
NAME
Page 2
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
Year 1
Explanation
Post.
Ref.
July
BAFS Learning and Teaching Example
As at April 2009
$
Topic C06: The Accounting Cycle
Student Worksheet p. 45
GENERAL LEDGER
NAME
Page 3
ACC. No.
Year 1
Explanation
Post.
Ref.
$
July
Year 1
Explanation
Post.
Ref.
$
July
NAME
Page 4
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
Year 1
Explanation
Post.
Ref.
July
BAFS Learning and Teaching Example
As at April 2009
$
Topic C06: The Accounting Cycle
Student Worksheet p. 46
GENERAL LEDGER
NAME
Page 5
ACC. No.
Year 1
Explanation
Post.
Ref.
$
July
Year 1
Explanation
Post.
Ref.
$
July
NAME
Page 6
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
Year 1
Explanation
Post.
Ref.
July
BAFS Learning and Teaching Example
As at April 2009
$
Topic C06: The Accounting Cycle
Student Worksheet p. 47
GENERAL LEDGER
NAME
Page 7
ACC. No.
Year 1
Explanation
Post.
Ref.
$
July
Year 1
Explanation
Post.
Ref.
$
July
NAME
Page 8
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
Year 1
Explanation
Post.
Ref.
July
BAFS Learning and Teaching Example
As at April 2009
$
Topic C06: The Accounting Cycle
Student Worksheet p. 48
GENERAL LEDGER
NAME
Page 9
ACC. No.
Year 1
Explanation
Post.
Ref.
$
July
Year 1
Explanation
Post.
Ref.
$
July
NAME
Page 10
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
Year 1
Explanation
Post.
Ref.
July
BAFS Learning and Teaching Example
As at April 2009
$
Topic C06: The Accounting Cycle
Student Worksheet p. 49
GENERAL LEDGER
NAME
Page 11
ACC. No.
Year 1
Explanation
Post.
Ref.
$
July
Year 1
Explanation
Post.
Ref.
$
July
NAME
Page 12
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
Year 1
Explanation
Post.
Ref.
July
BAFS Learning and Teaching Example
As at April 2009
$
Topic C06: The Accounting Cycle
Student Worksheet p. 50
GENERAL LEDGER
NAME
Page 13
ACC. No.
Year 1
Explanation
Post.
Ref.
$
July
Year 1
Explanation
Post.
Ref.
$
July
NAME
Page 14
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
Year 1
Explanation
Post.
Ref.
July
BAFS Learning and Teaching Example
As at April 2009
$
Topic C06: The Accounting Cycle
Student Worksheet p. 51
GENERAL LEDGER
NAME
Page 15
ACC. No.
Year 1
Explanation
Post.
Ref.
$
July
Year 1
Explanation
Post.
Ref.
$
July
NAME
Page 16
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
Year 1
Explanation
Post.
Ref.
July
BAFS Learning and Teaching Example
As at April 2009
$
Topic C06: The Accounting Cycle
Student Worksheet p. 52
Beauty Full Co.
Trial Balance
as at 31 July Year 1
Acc. No.
Account
Balances
Debit
Credit
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 53
Beauty Full Co.
INCOME STATEMENT
for the month ended 31 July Year 1
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet p. 54
Beauty Full Co.
BALANCE SHEET
as at 31 July Year 1
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.1
GENERAL JOURNAL – JULY
Date
Page 1
Post.
Ref.
Description
Year 1
July
1
Debit
Credit
$
$
Premises
GL01
400,000
Van
GL02
90,000
Fixtures
GL03
120,000
Inventory
GLO4
257,800
Accounts Receivable: Alan Fung
AR01
8,000
AR02
36,000
Bank
CB01
250,800
Cash
CB01
9,000
Candy Chan
Account Payable: Thomas Liu
Mandy Hui
Capital
AP01
12,000
AP02
40,000
GL05
1,119,600
Being assets, liabilities and capital as
1,171,600
1,171,600
at this date entered to open the books
1
Rent expense
GL12
Bank
CB01
3,000
3,000
Being rent expense paid for the month
4
Motor expense
GL13
Cash in hand
2,600
CB01
2,600
Being motor expense paid for the month
7
Drawings – Bobby Fu
GL14
Cash in hand
CB01
4,000
4,000
Being cash drawings made by sole proprietor
14
Van
GL03
Other Accounts Payable – Excellent Motor
60,000
AP08
60,000
Being motor van acquired on credit
16
Bank
CB01
7,600
Discount Allowed
GL07
400
Account Receivable – Alan Fung
AR01
Being Accounts Receivable – Alan Fung
repaid
BAFS Learning and Teaching Example
As at April 2009
8,000
Topic C06: The Accounting Cycle
Student Worksheet Answer p.2
GENERAL JOURNAL – JULY
Date
Page 2
Post.
Ref.
Description
Year 1
July
16
Debit
Credit
$
$
Bank
CB01
41,800
Discount Allowed
GL07
2,200
Accounts Receivable – Candy Chan
AR02
44,000
Being Accounts Receivable – Candy Chan
repaid
16
Bank
CB01
7,600
Discount Allowed
GL07
400
Accounts Receivable – Francis Au
AR03
8,000
Being Accounts Receivable – Francis Au
repaid
16
Bank
CB01
15,200
Discount Allowed
GL07
800
Accounts Receivable – Rose Ltd
AR05
16,000
Being Accounts Receivable – Rose Ltd repaid
24
Accounts Payable – Thomas Liu
AP03
16,000
Discount Received
GL10
800
Bank
CB01
15,200
Being Accounts Payable – Thomas Liu settled
24
Accounts Payable – Mandy Hui
AP02
40,000
Discount Received
GL10
2,000
Bank
CB01
38,000
Being Accounts Payable – Mandy Hui settled
24
Accounts Payable – Billy Woo
AP06
12,000
Discount Received
GL10
600
Bank
CB01
11,400
Being Accounts Payable – Billy Woo settled
30
Salaries expense
GL15
Bank
11,200
CB01
Being salaries expense paid to Amy Chan for
the month
BAFS Learning and Teaching Example
As at April 2009
11,200
Topic C06: The Accounting Cycle
Student Worksheet Answer p.3
GENERAL JOURNAL – JULY
Date
Page 3
Post.
Ref.
Description
Year 1
July
30
Government rates
GL16
Bank
Debit
Credit
$
$
13,200
CB01
13,200
Being government rates for the month
settled
31
Other Accounts Payable – Excellent Motor
GL15
Bank
60,000
CB01
60,000
Being motor van payment settled
31
Trading
GL04
257,800
Stock
257,800
Being Opening stock transferred to Trading
account
31
Stock
GL04
270,000
Trading
270,000
Being Closing stock transferred to Trading
account
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.4
SALES JOURNAL – JULY
Invoice
Number
Date
Account Debited
Page 1
Post.
Ref.
Amount
Year 1
July
$
3
103362
Francis Au
GL06
11,200
3
103363
Una Shum
GL06
15,600
5
103364
Rose Ltd.
GL06
19,600
6
103365
Lily Man
GL06
9,600
8
103366
Olivia Pau
GL06
23,600
8
103367
Candy Chan
GL06
8,000
9
103368
Una Shum
GL06
4,400
9
103369
Queenie Chiu
GL06
13,400
105,400
Total for the month
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.5
RETURNS INWARDS – JULY
Invoice
Number
Date
Account Credited
Page 1
Post.
Ref.
Amount
Year 1
July
$
11
103362
Francis Au
GL08
3,200
11
103364
Rose Ltd.
GL08
3,600
Total for the month
6,800
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.6
PURCHASES JOURNAL – JULY
Purchase
Order No.
Date
Account Debited
Page 1
Post.
Ref.
Amount
Year 1
July
$
2
4810
Thomas Liu
GL09
4,000
2
4910
Ellen Li
GL09
11,200
2
4813
Denise Hung
GL09
7,600
2
4809
Billy Woo
GL09
13,800
22
4821
Ellis Wang
GL09
17,800
22
4910
Ocean Co.
GL09
14,400
Total for the month
68,800
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.7
RETURNS OUTWARDS – JULY
Purchase
Order No.
Date
Account Debited
Page 1
Post.
Ref.
Amount
Year 1
July
19
$
4809
Billy Woo
GL10
Total for the month
1,800
1,800
BAFS Learning and Teaching Example
As at April 2009
Topic
C06:
The
Accounting
Cycle
Student
Worksh ee t
CASH BOOK – JULY
Date
Description
Post.
Ref.
Year 1
July
1
16
16
16
16
Balance b/f
Accounts Receivable Alan Fung
Accounts Receivable Candy Chan
Accounts Receivable Francis Au
Accounts Receivable Rose Ltd.
Discount
Cash
Bank
Date
$
$
$
Year 1
GJ01
9,000
250,800
July
Answer
Page 1
Description
Post.
Ref.
1
Rent expense
GJ01
Discount
Cash
Bank
$
$
$
3,000
GJ01
400
7,600
4
Motor expenses
GJ01
2,600
GJ02
2,200
41,800
7
Drawings
GJ01
4,000
GJ02
400
7,600
24
GJ02
800
15,200
24
24
3,800
9,000
323,000
p.8
Accounts Payable Thomas Liu
Accounts Payable Mandy Hui
Accounts Payable Billy Woo
GJ02
800
15,200
GJ02
2,000
38,000
GJ02
600
11,400
30
Salaries - Amy Chan
GJ02
11,200
30
Government rates
GJ03
13,200
31
Van
GJ03
60,000
31
Balance c/f
3,400
2,400
171,000
9,000
323,000
BAFS Learning and Teaching Example
As at April 2009
Topic
C06:
The
Accounting
Cycle
Student
Worksh ee t
Answer
p.9
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.10
ACCOUNTS RECEIVABLE LEDGER
Alan Fung
NAME
Page 1
ADDRESS
ACC. No.
Year 1
July
Explanation
1
Balance b/f
Post.
Ref.
GJ01
$
8,000
Year 1
July
Explanation
16
Bank
Discount Allowed
Post.
$
Ref.
GJ01
7,600
CB1
400
8,000
8,000
Candy Chan
NAME
Page 2
ADDRESS
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
1
Balance b/f
GJ01
36,000
8
Sales
SJ01
8,000
44,000
Year 1
July
Explanation
16
Bank
Discount Allowed
Post.
$
Ref.
GJ02
41,800
CB1
2,200
44,000
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.11
ACCOUNTS RECEIVABLE LEDGER
NAME
Francis Au
ADDRESS
334 Martha Road, Kowloon
Page 3
ACC. No.
Year 1
Explanation
3
July
Sales
Post.
Ref.
SJ01
$
11,200
Year 1
July
Explanation
Post.
$
Ref.
11
Returns inwards
RI01
3,200
16
Bank
GJ02
7,600
Discount
CB1
400
Allowed
11,200
11,200
Una Shum
NAME
Page 4
ADDRESS
ACC. No.
Year 1
July
Aug
Explanation
Post.
Ref.
$
Year 1
Explanation
$
Ref.
3
Sales
SJ01
15,600
9
Sales
SJ01
4,400
______
20,000
20,000
1
Balance b/f
July
31
Post.
Balance c/d
20,000
20,000
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.12
ACCOUNTS RECEIVABLE LEDGER
NAME
Rose Ltd.
ADDRESS
1 Lagune Road, Kowloon
Page 5
ACC. No.
Year 1
July
Explanation
5
Sales
Post.
Ref.
SJ01
$
19,600
Year 1
July
Explanation
Post.
$
Ref.
11
Returns Inwards
RI01
3,600
16
Bank
GJ02
15,200
Discount
CB1
800
Allowed
19,600
19,600
Lily Man
NAME
Page 6
ADDRESS
ACC. No.
Year 1
Explanation
July
6
Sales
Aug
1
Balance b/f
Post.
Ref.
SJ01
$
9,600
Year 1
July
Explanation
31
Post.
Ref.
Balance c/d
9,600
BAFS Learning and Teaching Example
As at April 2009
$
9,600
Topic C06: The Accounting Cycle
Student Worksheet Answer p.13
ACCOUNTS RECEIVABLE LEDGER
Olivia Pau
NAME
Page 7
ADDRESS
ACC. No.
Year 1
Explanation
July
8
Aug
1
Sales
Post.
Ref.
SJ01
Balance b/f
$
23,600
Year 1
July
Explanation
31
Post.
$
Ref.
Balance c/d
23,600
23,600
Queenie Chiu
NAME
Page 8
ADDRESS
ACC. No.
Year 1
Explanation
July
9
Sales
Aug
1
Balance b/f
Post.
Ref.
SJ01
$
13,400
Year 1
July
Explanation
31
Balance c/d
Post.
$
Ref.
13,400
13,400
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.14
ACCOUNTS PAYABLE LEDGER
NAME
Thomas Liu
ADDRESS
30 Ng Fong Street, Kwai Chung
Page 1
ACC. No.
Year 1
July
24
Explanation
Bank
Post.
Ref.
GJ01
$
15,200
Year 1
July
Discount
Receivable
Explanation
Post.
$
Ref.
1
Balance b/f
GJ01
12,000
2
Purchases
PJ01
4,000
800
16,000
16,000
Mandy Hui
NAME
Page 2
ADDRESS
ACC. No.
Year 1
July
24
Explanation
Post.
Ref.
$
Bank
GJ01
38,000
Discount
CB1
2,000
Year 1
July
Explanation
1
Balance b/f
Post.
$
Ref.
Gj01
40,000
Receivable
40,000
40,000
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.15
ACCOUNTS PAYABLE LEDGER
NAME
Ellen Li
ADDRESS
80 Kimberley Road, Tsimshatsui
Page 3
ACC. No.
Year 1
July
31
Explanation
Post.
Ref.
Balance c/d
$
11,200
Year 1
Post.
Explanation
July
3
Purchases
Aug
1
Balance b/f
$
Ref.
PJ01
11,200
11,200
NAME
Denise Hung
ADDRESS
7/F Kaiser Estate, 77 Sheung Heung Road, Tokawanwan
Page 4
ACC. No.
Year 1
July
31
Explanation
Balance c/d
Post.
Ref.
$
7,600
Year 1
Explanation
July
2
Purchases
Aug
1
Balance b/f
Post.
Ref.
PJ01
BAFS Learning and Teaching Example
As at April 2009
$
7,600
7,600
Topic C06: The Accounting Cycle
Student Worksheet Answer p.16
ACCOUNTS PAYABLE LEDGER
NAME
Billy Woo
ADDRESS
30 Catherine Street, Kowloon
Page 5
ACC. No.
Year 1
July
Explanation
Post.
Ref.
$
RO01
1,800
Bank
GJ02
11,400
Discount
CB1
600
19
Returns Outwards
24
Year 1
July
Explanation
2
Purchases
Post.
$
Ref.
PJ01
13,800
Receivable
13,800
13,800
NAME
Ellis Wang
ADDRESS
30 Ng Fong Street, Kwai Chung
Page 6
ACC. No.
Year 1
July
31
Explanation
Balance c/d
Post.
Ref.
$
17,800
Year 1
Explanation
July
22
Aug
1
Purchases
Balance b/f
Post.
$
Ref.
PJ01
17,800
17,800
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.17
ACCOUNTS PAYABLE LEDGER
NAME
Ocean Co.
ADDRESS
80 Kimberley Road, Tsimshatsui
Page 7
ACC. No.
Year 1
July
31
Explanation
Balance c/d
Post.
Ref.
$
14,400
Year 1
Explanation
July
22
Aug
1
Purchases
Balance b/f
Post.
$
Ref.
PJ01
14,400
14,400
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.18
GENERAL LEDGER
NAME
Premises
ACC. No.
001
Year 1
Explanation
July
1
Balance b/f
Aug
1
Balance b/d
NAME
Van
ACC. No.
002
Year 1
July
Explanation
Page 1
Post.
Ref.
GJ01
$
400,000
Post.
Ref.
$
Balance b/d
GJ01
90,000
14
Excellent Motor
GJ01
60,000
Balance b/d
31
Post.
$
Ref.
Balance c/d
400,000
Page 2
1
1
July
Explanation
400,000
150,000
Aug
Year 1
Year 1
July
Explanation
31
Balance c/d
Post.
$
Ref.
150,000
150,000
150,000
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.19
GENERAL LEDGER
NAME
Fixtures
ACC. No.
003
Year 1
Explanation
July
1
Balance b/f
Aug
1
Balance b/d
NAME
Stock
ACC. No.
004
Year 1
July
Explanation
1
Balance b/f
Page 3
Post.
Ref.
GJ01
$
120,000
Year 1
July
Explanation
31
Post.
$
Ref.
Balance c/d
120,000
120,000
Page 4
Post.
Ref.
GJ01
$
Year 1
Explanation
Post.
$
Ref.
257,800
July
31
Trading
257,800
July
31
Balance c/d
270,000
July
31
Trading
270,000
Aug
1
Balance b/d
270,000
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.20
GENERAL LEDGER
NAME
Capital
ACC. No.
005
Year 1
July
Explanation
31
Drawings
31
Balance c/d
Page 5
Post.
Ref.
GL14
$
4,000
Year 1
July
Explanation
1
31
1,129,000
Balance b/f
Post.
GJ01
13,400
1,133,000
Aug
Sales
ACC. No.
006
Year 1
July
31
Explanation
Trading
1,119,600
Net profit for the month
1,133,000
NAME
$
Ref.
1
Balance b/d
1,129,000
Page 6
Post.
Ref.
$
105,400
105,400
Year 1
July
Explanation
Post.
$
Ref.
3
Francis Au
SJ01
11,200
3
Una Shum
SJ01
15,600
5
Rose Ltd
SJ01
19,600
6
Lily Man
SJ01
9,600
8
Olivia Pau
SJ01
23,600
8
Candy Chan
SJ01
8,000
9
Una Shum
SJ01
4,400
9
Queenie Chiu
SJ01
13,400
31
105,400
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.21
GENERAL LEDGER
NAME
Discount Allowed
ACC. No.
007
Year 1
16
Explanation
Accounts
Post.
Ref.
Page 7
$
Year 1
400
GJ01
Receivable -
July
Explanation
31
Post.
Ref.
Profit & loss
$
3,800
July
AF
16
Accounts
GJ01
2,200
GJ01
400
GJ01
800
Receivable CC
16
Accounts
Receivable –
FA
16
Accounts
Receivable RL
3,800
NAME
Returns inwards
ACC. No.
008
Year 1
July
Explanation
Post.
Ref.
3,800
Page 8
$
11
Francis Au
RI01
3,200
11
Rose Ltd
RI01
3,600
Year 1
July
Explanation
31
Post.
Ref.
Trading
6,800
$
6,800
6,800
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.22
GENERAL LEDGER
NAME
Purchases
ACC. No.
009
Year 1
Explanation
Page 9
Post.
Ref.
$
2
Thomas Liu
PJ01
4,000
2
Ellen Li
PJ01
11,200
2
Denise Hung PJ01
7,600
2
Billy Woo
PJ01
13,800
22
Ellis Wang
PJ01
17,800
22
Ocean Co
PJ01
14,400
July
Year 1
July
Explanation
31
Post.
Trading
68,800
68,800
NAME
Discount Received
ACC. No.
010
Year 1
July
31
Explanation
Profit & loss
Post.
Ref.
$
Ref.
68,800
Page 10
$
3,400
Year 1
July
Explanation
24
Accounts
Post.
Ref.
GJ02
$
800
Payable-TL
24
Accounts
GJ02
2,000
GJ02
600
Payable -MH
24
Accounts
Payable-BW
3,400
3,400
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.23
GENERAL LEDGER
NAME
Returns outwards
ACC. No.
011
Year 1
July
Explanation
31
Rent expense
ACC. No.
012
July
Explanation
1
Ref.
Trading
NAME
Year 1
Post.
Bank
Page 11
$
1,800
Year 1
July
Explanation
19
Billy Woo
Post.
Ref.
RO01
$
1,800
Page 12
Post.
Ref.
GJ01
$
3,000
Year 1
July
Explanation
31
Post.
Ref.
Profit & loss
BAFS Learning and Teaching Example
As at April 2009
$
3,000
Topic C06: The Accounting Cycle
Student Worksheet Answer p.24
GENERAL LEDGER
NAME
Motor expenses
ACC. No.
013
Year 1
July
Explanation
31
Bank
NAME
Drawings
ACC. No.
014
Year 1
July
Explanation
7
Drawings
Page 13
Post.
Ref.
GJ01
$
2,600
Year 1
July
Explanation
31
Post.
Ref.
Profit & loss
$
2,600
Page 14
Post.
Ref.
GJ02
$
4,000
Year 1
July
Explanation
31
Post.
Ref.
Capital
BAFS Learning and Teaching Example
As at April 2009
$
4,000
Topic C06: The Accounting Cycle
Student Worksheet Answer p.25
GENERAL LEDGER
NAME
Salaries expense
ACC. No.
015
Year 1
July
30
Explanation
Bank
Post.
Ref.
GJ02
NAME
Government rates
ACC. No.
016
Year 1
July
30
Explanation
Bank
Post.
Ref.
GJ03
Page 15
$
11,200
Year 1
July
Explanation
31
Post.
$
Ref.
Profit & loss
11,200
Page 16
$
13,200
NAME
Excellent Motor
ADDRESS
22 Maple Street, Kowloon
Year 1
July
Explanation
31
Post.
$
Ref.
Profit & loss
13,200
Page 8
ACC. No.
Year 1
July
31
Explanation
Bank
Post.
Ref.
GJ03
$
60,000
Year 1
July
Explanation
14
Van
Post.
$
Ref.
GJ01
60,000
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.26
Beauty Full Co.
Trial Balance
as at 31 July Year 1
Acc. No.
Account
Balances
Debit
Credit
$
$
001
Premises
400,000
002
Van
150,000
003
Fixtures
120,000
004
Inventory as at 1 July Year 1
257,800
017
Cash in hand
018
Bank
019
Accounts receivable Accounts Receivable
020
Accounts payable - Accounts
Payable
005
Capital
006
Sales
007
Discount Allowed
3,800
008
Returns inwards
6,800
009
Purchases
010
Discount Received
3,400
011
Returns outwards
1,800
012
Rent expense
3,000
013
Motor expenses
2,600
014
Drawings
4,000
015
Salary expense
11,200
016
Government rates
13,200
2,400
171,000
66,600
51,000
1,119,600
105,400
68,800
1,281,200
1,281,200
Note: Inventory as at 31 July of Year 1 is $270,000
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.27
Beauty Full Co.
INCOME STATEMENT
for the month ended 31 July Year 1
$
$
Sales
$
105,400
Less Returns inwards
6,800
98,600
Less Cost of goods sold:
Opening stock
Purchases
Less Returns outwards
257,800
68,800
1,800
67,000
324,800
Less Closing Stock
270,000
Gross profit
54,800
43,800
Add Revenue:
Discount Received
3,400
47,200
Less Expenses:
Discount Allowed
3,800
Rent expense
3,000
Motor expense
2,600
Salaries expense
11,200
Government rates
13,200
Net profit for the month
33,800
13,400
BAFS Learning and Teaching Example
As at April 2009
Topic C06: The Accounting Cycle
Student Worksheet Answer p.28
Beauty Full Co.
BALANCE SHEET
as at 31 July Year 1
$
$
Fixed Assets
Premises
400,000
Van
150,000
Fixtures
120,000
670,000
Current Assets
Inventory
Accounts receivable
Bank
Cash in hand
270,000
66,600
2,400
171,000
510,000
Less Current Liabilities
Accounts payable
Net current assets
Less Long-term Liabilities
1,000
459,000
0
1,129,000
Financed by:
Capital as at 1 July Year 1
Add Net profit for the month
1,119,600
13,400
1,133,000
Less Drawings
4,000
1,129,000
BAFS Learning and Teaching Example
As at April 2009