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Chapter 7
Example 4
ZAD had a favourable balance of $216 in its business bank account as at the
start of business on 1 May 20X8. The following is a list of bank transactions for
the week ending 7 May 20X8:
2 May Paid an insurance premium of $130 by cheque.
3 May Paid an invoice for $99 from GDS after deducting 10% for prompt
payment.
4 May Received a cheque for $314 from FRD, a credit customer. FRD was
settling an invoice for $320 and had been entitled to a $6 discount.
6 May Paid employees their week’s wages of $182 by cheque.
Required:
Record these transactions in the cash books of ZAD.
Example 4: Solution
Cash receipts book:
Bank Sales ledger Discounts
Date Details $ $ allow. $
Cash payments book:
Bank Insurance Wages Purchase Discount
Date Details $ $ $ ledger $ rec $
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