Please kindly assist with this question. As at 31 July 20.7, compare the account of GH Entity, as it appears in the records of AC Entity, with the statement received from GH Entity, and:a) If it appears that the account of GH Entity (in the records of AC Entity) is incomplete or contains errors:(i) Journalise the necessary entries in the records of AC Entity; and (ii) Open GH Entity’s account (in the records of AC Entity) with the credit balance of R290 700 and post the journals of a(i) to this account. The account must be provided in the formal column format. Note: Journal narrations and the effect on the accounting equation are not required.b) If it appears that the statement from GH Entity is incomplete or contains errors:(i) Prepare a payables reconciliation as at 31 July 20.7 56On 29 July 20.7, AC Entity returned some of the merchandise purchased on 14 July 20.7 toGH Entity due to latent defects.AC Entity and GH Entity are both registered as vendors in accordance with the VAT-Act.REQUIRED:As at 31 July 20.7, compare the account of GH Entity, as it appears in the records of AC Entity, withthe statement received from GH Entity, and: AC Entity's recordsK87 Payable GH12Date320.71 Jul3 Jul7 Jul14 Jul16 Jul22 Jul25 Jul4Date1 Jul2 Jul2 Jul3 Jul9 Jul14 Jul16 JulContra accounts23 Jul31 JulBalance bdInventories and VAT-inputBankInventories and VAT-inputInventories and VAT-inputBankInventories and VAT-inputADDITIONAL INFORMATION:On 3 August 20.7, the following statement was received electronically from Payable GH:GH EntityStreet address Postal address Telephone Fax e-mailContra accountsBalance bdReversal of incorrect debitDocumentBankSales and VAT-outputBankSales and VAT-outputSales and VAT-outputBankReturns (in) and VAT-outputGH 1080EFT 181GH 1109GH 1121Statement of AC Entity31 July 20.7EFT 199GK 602DocumentGH 1070EFT 167GH 1080EFT 181GH 1109GH 1121EFT 199GH/KN 89DrPayables reconciliation as at 30 June 20.720.730 Jun30 Jun30 Jun115 300Balance as per statementPayment not accounted for - EFT 167Incorrect debit Invoice GH1070137 826Dr393 300136 80085 215141 360Cr115 300129 960Dr393 30085 215137 82675 525Cr96 900181 100115 300137 82613 794CrBalance181 10096 900115 300245 260129 960215 175353 001The following information represents the reconciliation, as at 30 June 20.7, between theaccount for Payable GH with the statement for June 20.7 received from Payable GH:215 175290 700Balance393 300296 400115 300252 100136 800222 015363 375225 549211 755Balance393 300212 200115 300Invoice GH 1080 reflects inter alia the following amounts: A listed price of R120 000 andtrade discount of R6 000 (both amounts exclude VAT).Invoice GH 1121 reflects inter alia the following amounts: A listed price of R124 000(excluding VAT). Furthermore, a settlement discount of 2.5% will be granted if payment isreceived within 10 days from the date of the invoice (16 July 20.7). AC Entity's paymenthistory indicates that the entity usually makes use of the settlement discount.Invoice GK 602 does not relate to Payable GH, but relates to Payable GK.

Given in the question: In the books of AC Entity Balance as on July 25 of GH Payable is 290,700 In…

Answered: As at 31 July 20.7, compare the account…

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Please kindly assist with this question.

As at 31 July 20.7, compare the account of GH Entity, as it appears in the records of AC Entity, with
the statement received from GH Entity, and:
a) If it appears that the account of GH Entity (in the records of AC Entity) is incomplete or contains
errors:
(i) Journalise the necessary entries in the records of AC Entity; and
(ii) Open GH Entity’s account (in the records of AC Entity) with the credit balance of R290 700
and post the journals of a(i) to this account. The account must be provided in the formal
column format.
Note: Journal narrations and the effect on the accounting equation are not required.
b) If it appears that the statement from GH Entity is incomplete or contains errors:
(i) Prepare a payables reconciliation as at 31 July 20.7

5
6
On 29 July 20.7, AC Entity returned some of the merchandise purchased on 14 July 20.7 to
GH Entity due to latent defects.
AC Entity and GH Entity are both registered as vendors in accordance with the VAT-Act.
REQUIRED:
As at 31 July 20.7, compare the account of GH Entity, as it appears in the records of AC Entity, with
the statement received from GH Entity, and:

AC Entity's records
K87 Payable GH
1
2
Date
3
20.7
1 Jul
3 Jul
7 Jul
14 Jul
16 Jul
22 Jul
25 Jul
4
Date
1 Jul
2 Jul
2 Jul
3 Jul
9 Jul
14 Jul
16 Jul
Contra accounts
23 Jul
31 Jul
Balance bd
Inventories and VAT-input
Bank
Inventories and VAT-input
Inventories and VAT-input
Bank
Inventories and VAT-input
ADDITIONAL INFORMATION:
On 3 August 20.7, the following statement was received electronically from Payable GH:
GH Entity
Street address Postal address Telephone Fax e-mail
Contra accounts
Balance bd
Reversal of incorrect debit
Document
Bank
Sales and VAT-output
Bank
Sales and VAT-output
Sales and VAT-output
Bank
Returns (in) and VAT-output
GH 1080
EFT 181
GH 1109
GH 1121
Statement of AC Entity
31 July 20.7
EFT 199
GK 602
Document
GH 1070
EFT 167
GH 1080
EFT 181
GH 1109
GH 1121
EFT 199
GH/KN 89
Dr
Payables reconciliation as at 30 June 20.7
20.7
30 Jun
30 Jun
30 Jun
115 300
Balance as per statement
Payment not accounted for - EFT 167
Incorrect debit Invoice GH1070
137 826
Dr
393 300
136 800
85 215
141 360
Cr
115 300
129 960
Dr
393 300
85 215
137 826
75 525
Cr
96 900
181 100
115 300
137 826
13 794
Cr
Balance
181 100
96 900
115 300
245 260
129 960
215 175
353 001
The following information represents the reconciliation, as at 30 June 20.7, between the
account for Payable GH with the statement for June 20.7 received from Payable GH:
215 175
290 700
Balance
393 300
296 400
115 300
252 100
136 800
222 015
363 375
225 549
211 755
Balance
393 300
212 200
115 300
Invoice GH 1080 reflects inter alia the following amounts: A listed price of R120 000 and
trade discount of R6 000 (both amounts exclude VAT).
Invoice GH 1121 reflects inter alia the following amounts: A listed price of R124 000
(excluding VAT). Furthermore, a settlement discount of 2.5% will be granted if payment is
received within 10 days from the date of the invoice (16 July 20.7). AC Entity's payment
history indicates that the entity usually makes use of the settlement discount.
Invoice GK 602 does not relate to Payable GH, but relates to Payable GK.

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