Journal Entry In the attached question, kindly help in clarifying is it is necessary to create journal entries for assessts and liabilities established on 1 Sep 2021 or it is sufficient to create journal entries only for the unsure transactions. If journal entries for assessts and liabilities established on 1 Sep 2021 are to be created, kindly review if the attached answer is correct .
Journal Entry In the attached question, kindly help in clarifying is it is necessary to create journal entries for assessts and liabilities established on 1 Sep 2021 or it is sufficient to create journal entries only for the unsure transactions. If journal entries for assessts and liabilities established on 1 Sep 2021 are to be created, kindly review if the attached answer is correct .
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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In the attached question, kindly help in clarifying is it is necessary to create journal entries for assessts and liabilities established on 1 Sep 2021 or it is sufficient to create journal entries only for the unsure transactions.
If journal entries for assessts and liabilities established on 1 Sep 2021 are to be created, kindly review if the attached answer is correct .
![F Polk, after being in Bakery business for some years without keeping proper records, now decides
to keep a double entry set of books. On 1 September 2021 he establishes that his assets and
liabilities are as follows: Assets: Van £5,700, Fixtures £2,800, Stock £5,200, Debtors -P Mullen
£105, M Abel £311, Bank £1060, Cash £85. Liabilities: Creditors - Syme Ltd £229, A Hill £80.
(1)
He is not sure about Journal entries for the following transactions in September 2021 as follows:
Sep 1: A debt of £105 owing from P Mullen was written off as a bad debt
Sep 5: Office Fixtures originally bought by credit for £150 was returned to the supplier Syme Ltd., as
it was unsuitable. Full allowance will be given for this.
Sep 10: The business is owed £311 by M. Abel. He is declared bankrupt and we only received
£180 cash in full settlement of the debt.
Page | 9
Sep 18: Bought a Machinery from Brown Ltd. to use in the company. The total purchasing value of
the machine is £1,800. The owner paid £100 cash, £500 by issuing a cheque and rest of
the purchasing value would remain as credit.
Sep 26 The owner paid half of the machinery debt to Brown Ltd. by issuing a cheque.
Sep 28: The owner paid £130 an insurance bill via cheque thinking that it was in respect of the
business. We now discover that £70 of the amount paid was in fact insurance of our private
house.
Required:
You are required to show the Journal entries (only) (with narrative) necessary to record the items
which occur in Sep 2021.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Faf342599-70a5-4bae-a995-d8b56ea31523%2F46823aad-ac89-4bbe-a0e7-637e42c9bf2a%2Fuqemhbo_processed.jpeg&w=3840&q=75)
Transcribed Image Text:F Polk, after being in Bakery business for some years without keeping proper records, now decides
to keep a double entry set of books. On 1 September 2021 he establishes that his assets and
liabilities are as follows: Assets: Van £5,700, Fixtures £2,800, Stock £5,200, Debtors -P Mullen
£105, M Abel £311, Bank £1060, Cash £85. Liabilities: Creditors - Syme Ltd £229, A Hill £80.
(1)
He is not sure about Journal entries for the following transactions in September 2021 as follows:
Sep 1: A debt of £105 owing from P Mullen was written off as a bad debt
Sep 5: Office Fixtures originally bought by credit for £150 was returned to the supplier Syme Ltd., as
it was unsuitable. Full allowance will be given for this.
Sep 10: The business is owed £311 by M. Abel. He is declared bankrupt and we only received
£180 cash in full settlement of the debt.
Page | 9
Sep 18: Bought a Machinery from Brown Ltd. to use in the company. The total purchasing value of
the machine is £1,800. The owner paid £100 cash, £500 by issuing a cheque and rest of
the purchasing value would remain as credit.
Sep 26 The owner paid half of the machinery debt to Brown Ltd. by issuing a cheque.
Sep 28: The owner paid £130 an insurance bill via cheque thinking that it was in respect of the
business. We now discover that £70 of the amount paid was in fact insurance of our private
house.
Required:
You are required to show the Journal entries (only) (with narrative) necessary to record the items
which occur in Sep 2021.
![Jounal Entry
Date
Particular
Debit
Credit
01-Sep-21
Vehicle A/C
5700
Cash
5700
01-Sep-21
Fixtures
2800
Cash
2800
01-Sep-21
Stock
5200
Cash
5200
01-Sep-21
Accounts Receivable (P Mullen)
105
Debtors A/C
105
01-Sep-21
Accounts Receivable (M Abel)
311
Debtors A/C
311
01-Sep-21
Capital A/C
1080
Bank
1080
01-Sep-21
Capital A/C
85
Cash
85
01-Sep-21
Account Payable - Syme Ltd
229
Cash
229
01-Sep-21
Account Payable - A Hill
80
Cash
80
01-Sep-21
Allowance for Doubtful Accounts
£105
Accounts Receivable (P Mullen)
£105
To record written-off bad debt
Accounts Payable - Syme Ltd
05-Sep-21
£150
Purchase returns and allowances
£150
To record unsuitable office fixtures returned to supplier
10-Sep-21
Allowance for Doubtful Accounts
£311
Accounts Receivable (M. Abel)
£131
Cash
£180
To record write-off customer's account
Machinery A/C
Accounts Payable - Brown Ltd.
18-Sep-21
£1,800
£1,200
Bank
£500
Cash
£100
To record the purchase of machinery
Accounts Payable - Brown Ltd.
26-Sep-21
£600
Bank
£600
To record payment made to machinery supplier
28-Sep-21
Bank
Accounts Receivable - Insurance A/C
£60
£70
Bank
£130
To record payment made towards insurance bill
£18,686
£18,686](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Faf342599-70a5-4bae-a995-d8b56ea31523%2F46823aad-ac89-4bbe-a0e7-637e42c9bf2a%2Fpwf782k_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Jounal Entry
Date
Particular
Debit
Credit
01-Sep-21
Vehicle A/C
5700
Cash
5700
01-Sep-21
Fixtures
2800
Cash
2800
01-Sep-21
Stock
5200
Cash
5200
01-Sep-21
Accounts Receivable (P Mullen)
105
Debtors A/C
105
01-Sep-21
Accounts Receivable (M Abel)
311
Debtors A/C
311
01-Sep-21
Capital A/C
1080
Bank
1080
01-Sep-21
Capital A/C
85
Cash
85
01-Sep-21
Account Payable - Syme Ltd
229
Cash
229
01-Sep-21
Account Payable - A Hill
80
Cash
80
01-Sep-21
Allowance for Doubtful Accounts
£105
Accounts Receivable (P Mullen)
£105
To record written-off bad debt
Accounts Payable - Syme Ltd
05-Sep-21
£150
Purchase returns and allowances
£150
To record unsuitable office fixtures returned to supplier
10-Sep-21
Allowance for Doubtful Accounts
£311
Accounts Receivable (M. Abel)
£131
Cash
£180
To record write-off customer's account
Machinery A/C
Accounts Payable - Brown Ltd.
18-Sep-21
£1,800
£1,200
Bank
£500
Cash
£100
To record the purchase of machinery
Accounts Payable - Brown Ltd.
26-Sep-21
£600
Bank
£600
To record payment made to machinery supplier
28-Sep-21
Bank
Accounts Receivable - Insurance A/C
£60
£70
Bank
£130
To record payment made towards insurance bill
£18,686
£18,686
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