Lcci Passport to Sucess Level 1 Book-Keeping Answer

Level 1 Book-saving Solutions Booklet For additional data reach us: Tel. +44 (0) 8707 202909 Email. [email protected] com www. lcci. organization. uk London Chamber of Commerce and Industry (LCCI) International Qualifications are given by EDI, a main worldwide granting body. Identification to Success Level 1 Book-keeping Solutions Booklet The initials LCCI and the words LONDON CHAMBER OF COMMERCE AND INDUSTRY are enlisted trademarks having a place with the London Chamber of Commerce and Industry and are utilized under licence.Every exertion has been made to follow all copyright holders, yet on the off chance that any have been incidentally ignored the Publishers will be satisfied to make the essential game plans at the main chance. © EDI 2008 First distributed in 2008. All rights held. Aside from any utilization allowed under UK copyright law, no piece of this distribution might be repeated or transmitted in any structure or using any and all means, electronic or mechanical, includi ng copying and recording, or held inside any data stockpiling and recovery framework, without consent recorded as a hard copy from the distributer or under permit from the Copyright Licensing Agency Limited.Further subtleties of such licenses (for reprographic proliferation) might be acquired from the Copyright Licensing Agency Limited, Saffron House, 610 Kirby Street, London EC1N 8TS. Spread photograph: www. fotolia. com TABLE OF CONTENTS 1. 2. 3. 4. The Accounting Equation and the Balance Sheet Double passage framework for resources, liabilities and capital Recording twofold section for stock The twofold passage framework for Expenses and Revenues and the Effect of Profit (or misfortune) and drawings upon capital 1 4 7 11 5. 6. 7. 8. 9.Balancing records and the Trial Balance Trading and Profit ( whether increment or diminishing) and afterward apply the twofold passage leads as underneath: To build a benefit, DEBIT the record To diminish an advantage, CREDIT the record To expand an obligation or capital, CREDIT the record To diminish a risk or capital, DEBIT the record 4 Question 4 Bank ? 20X2 6 000 July 15 July 29 20X2 July 01 Capital Office Machinery Elstead Garage ? 420 2 900 Capital 20X2 July 01 Bank ? 6 000 20X2 July 06Motor Vehicle ? Elstead Garage 2 800 20X2 July 29 Bank Elstead Garage ? 20X2 2 800 July 06 Motor vehicle ? 2 800 20X2 July 15 Bank Office Machinery ? 420 20X2 July 23 Office Equipment ? Longmore when the borrower pays for the merchandise his record is credited and the bank/money is charged. Question 3 (a) (b) (c) (d) (e) (f) Sold merchandise using a credit card to F. Winter N. Protection returns products to You settle a banks account with a money order F. Winter pays his record You pay Grange Garages with a money order the sum due on the conveyance vehicle recently bought You return merchandise to B. Savvy Debit F Winter Returns Inwards Creditor Bank Grange Garages B Smart Credit Sales N Armor Bank F Winter Bank Returns Outwards Question 4 20X7 March 01 Capital March 30 B Wright Bank ? 20X7 10 000 March 03 Office Furniture 70 March 23 Scales Motors March 26 T Hunt ? 460 3 600 320 Capital 20X7 March 01 Bank ? 10 000 20X7 March 03 Bank Office Furniture ? 460 20X7 March 05 Purchases ? 375 T Hunt 20X7 ? Walk 08 Returns Outwards 55 March 05 March 26 Bank 320 Purchases ? 375 Returns Outwards 20X7 March 08 T Hunt ? 55 20X7 March 12 Sales B Wright 20X7 ? 156 March 19 March 30 Returns Inwards Bank ? 26 70 Sales 20X7 March 12 B Wright ? 56 8 20X7 March 15 Scales MotorsMotor Vehicle ? 3 600 20X7 March 23 Bank Scales Motors ? 20X7 3 600 March 15 Motor Vehicle ? 3 600 20X7 March 19 B Wright Returns Inwards ? 26 Question 5 20X7 October 01 Capital October 17 Cash 20X7 ? 8 600 October 02 80 October 07 ? 8 000 179 Bank Purchases Capital 20X7 October 01 Cash ? 8 600 20X7 October 02 Cash October 23 Loan R Nandha October 31 J Durrant Bank ? 20X7 8 000 October 21 October 29 1 200 303 Motor Vehicle M Price ? 1 990 100 20X7 October 03 Octo ber 07 M Price Cash Purchases ? 250 179 20X7 October 13 Returns Outwards October 29 Bank M Price ? 0X7 October 03 32 100 Purchases ? 250 9 Fixtures this is the equalization at the last date of the bookkeeping time frame (e. g. a month). The Ëœbalance b/d is the sum moved (cut down or presented) from a past bookkeeping period to the present one; this is the parity at the main date of the bookkeeping time frame. (d) The twofold lines are important to show that the record has been adjusted and that the aggregates are last figures. e) Accounts are cut off when there is no equalization on the record toward the finish of the bookkeeping time frame. Movement 5. 2 20X9 July 01 July 04 July 09 July 13 July 15 July 19 July 22 July 24 July 29 Capital Equipment Wages Sales Computers Wages Sales Motor vehicles Wages Debit ? 55 000 Credit ? 5 000 900 Balance ? 55 000 50 000 49 100 58 650 50 650 49 750 53 630 47 630 46 530 9 550 8 000 900 3 880 6 000 1 100 16 Solutions to Target Practice Questions Question 1 E. Appleby 20X6 ? 650 October 07 Returns Inwards 276 October 18 Bank 190 October 31 Balance c/d 1 116 506 0X6 October 03 Sales October 12 Sales October 24 Sales November 01 Balance b/d ? 120 490 506 1 116 Answer There is a charge parity of ? 506. Question 2 N Small ? 145 215 185 ___ 545 365 20X3 March 04 March 18 March 23 Sales 20X3 March 13 March 26 March 30 March 31 Returns Inwards Returns Inwards Bank Balance c/d ? 20 35 125 365 545 April 01 Balance b/d 20X3 March 21 March 31 Bank A Smith 20X3 ? 70 March 10 290 360 Purchases ? 360 ___ 360 20X3 March 07 March 28 March 31 T Dove 20X3 ? Returns Outwards 35 March 02 Bank 235 March 15 Balance c/d 310 580 April 01 Purchases PurchasesBalance b/d ? 270 310 ___ 580 310 N Small is a borrower and T Dove is a loan boss. A Smith is not one or the other. 17 Question 3 T Dove 20X3 March 02 March 07 March 15 March 28 Purchases Returns Outwards Purchases Bank Debit ? 35 310 235 Credit ? 270 Balance ? 270 Cr 235 Cr 545 Cr 310 Cr N Smal l 20X3 March 04 March 13 March 18 March 23 March 26 March 30 Sales Returns Inwards Sales Returns Inwards Bank Debit ? 145 215 185 35 125 Credit ? 20 Balance ? 145 Dr 125 Dr 340 Dr 525 Dr 490 Dr 365 Dr A Smith 20X3 March 10 March 21 March 31 Purchases Bank Debit ? 70 290 Credit ? 360 Balance ? 360 Cr 290 Cr NILQuestion 4 (a) 20X5 January 01 January 23 January 26 January 31 Capital Cash S Lee Capital Bank ? 20X5 25 000 January 01 6 000 January 25 5 500 January 29 5 000 January 30 January 30 January 31 _____ January 31 41 500 23 000 ? Lease 2 000 Cash 500 Midland Motors 4 000 D. Terry 8 000 E. Appleby 2 000 Electricity 2 000 Balance c/d 23 000 41 500 February 01 Balance b/d 20X5 January 31 Balance b/d Capital ? 20X5 30 000 January 1 Bank .. ¦ ¦. January 31 Bank 30 000 February 01 Balance c/d ? 25 000 5 000 30 000 30 000 18 20X5 January 1 Bank February 01 Balance b/d Rent 20X5 ? 2 000 January 31 2 000 2 000Balance c/d ? 2 000 2 000 20X5 January 03 January 05 January 15 D Terry E Appleb y D Terry February 01 Balance b/d Purchases ? 20X5 5 000 January 31 3 000 10 000 18 000 18 000 Balance c/d ? 18 000 ¦ ¦ ¦. 18 000 20X5 January 22 January 30 January 31 Returns Outwards Bank Balance c/D Terry 20X5 ? January 03 Purchases 2 000 January 15 Purchases 8 000 5 000 15 000 February 01 Balance b/d ? 5 000 10 000 _____ 15 000 5 000 Motor Car 20X5 ? January 04 Midland Motors 4 000 January 31 February 01 Balance b/d 4 000 Balance c/d ? 4 000 20X5 January 29 Bank Midland Motors 20X5 ? 4 000 January 4 000 Motor Car 4 000 4 000 20X5 January 30 January 31 Bank Balance c/d E Appleby 20X5 ? Buys 2 000 January 5 1 000 3 000 February 01 Balance b/d ? 3 000 ¦ ¦.. 3 000 1 000 19 20X5 January 10 January 25 Sales Bank February 01 Balance b/d Cash 20X5 ? 6 000 January 23 500 January 28 ¦ ¦.. January 31 6 500 250 Bank Office costs Balance c/d ? 6 000 250 6 500 20X5 January 31 Balance c/d Sales 20X5 ? 14 000 January 10 Cash ¦ ¦ ¦ January 20 S Lee 14 000 February 01 Balance b/d ? 6 000 8 00 0 14 000 14 000 20X5 January 20 Sales February 01 Balance b/d S Lee 20X5 ? 8 000 January 24 January 25 ¦ ¦.. January 31 8 000 1 500Returns Inwards Bank Balance c/d ? 1 000 5 500 1 500 8 000 20X5 January 31 Balance c/d Returns Outwards 20X5 ? 2 000 January 22 D Terry 2 000 February 01 Balance b/d ? 2 000 2 000 2 000 20X5 January 24 S Lee February 01 Balance b/d Returns Inwards 20X5 ? 1 000 January 31 1 000 1 000 Balance c/d ? 1 000 1 000 20 Office Expenses 20X5 ? Money 250 January 31 250 February 01 Balance b/d 250 20X5 January 28 Balance c/d ? 250 20X5 January 31 Bank February 01 Balance b/d Electricity 20X5 ? 2 000 January 31 2 000 2 000 Balance c/d ? 2 000 2 000 (b) Steve Trial Balance at 31January 20X5 DR CR ? Bank Capital Rent Purchases D Terry Motor Car E Appleby Cash Sales S Lee Returns Outwards Returns Inwards Office Expenses Electricity 23 000 30 000 2 000 18 000 5 000 4 000 1 000 250 14 000 1 500 2 000 1 000 250 2 000 52 000 _____ 52 000 Question 5 Bank 20X8 ? 5 000 May 16 700 May 27 May 30 ¦ ¦.. May 31 5 700 1 300 20X8 May 01 May 18 Balance b/d Bank Dodd Delivery Van Cash Balance c/d ? 2 900 1 200 300 1 300 5 700 June 01 Balance b/d 21 20X8 May 31 Balance c/d Capital 20X8 ? 20 000 May 01 20 000 June 01 Balance b/d Balance b/d ? 20 000 20 000 20 000 20X8 May 01 May 04 May 30 June 01 Balance b/d Sales Bank Balance b/d Cash 20X8 ? 000 May 07 2 000 May 23 300 May 31 3 300 900 Purchases Office Expenses Balance c/d ? 1 500 900 3 300 20X8 May 16 May 31 Bank Balance c/d Dodd 20X8 ? 2 900 May 01 2 100 May 02 5 000 June 01 Balance b/d Purchases Balance b/d ? 2 000 3 000 5 000 2 100 20X8 May 01 May 10 June 01 Balance b/d Sales Balance c/d Fish ? 20X8 6 000 May 18 5 000 May 31 11 000 10 300 ? Bank Balance b/d 700 10 300 11 000 20X8 May 01 June 01 Balance b/d Balance b/d Furniture ? 20X8 10 000 May 31 10 000 10 000 Balance c/d ? 10 000 10 000 20X8 May 02 May 07 June 01 Dodd Cash Balance b/d Purchases 20X8 ? 3 000 May 31 1 500 4 500 4 500 Balance c/d 4 500 ¦ ¦. . 4 500 22 20X8 May 31 Balance c/d Sales 20X8 ? 7 000 May 04 ____ May 10 7 000 June 01 Cash Fish Bala