Accounts by BPP Learning Media

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Such records are made in books of prime entry. Definition Books of prime entry are books in which we first record transactions. The main books of prime entry are as follows. (a) (b) (c) (d) (e) (f) (g) Sales day book Purchase day book Sales returns day book Purchases returns day book Journal (described in the next chapter) Cash book Petty cash book It is worth bearing in mind that, for convenience, this chapter describes books of prime entry as if they are actual books. Nowadays, books of prime entry are not books at all, but rather files hidden in the memory of a computer.

She decides to take out drawings of £240 for her week's work. She also pays Bianca £40 in cash. She decides to make the interest payment to her Uncle Felix the next time she sees him. (f) We shall ignore any van expenses for the week, for the sake of relative simplicity. Required (a) State the business equation: (i) After Courtney and Uncle Felix have put more money into the business and after the purchase of the van. (ii) After the sale of goods to Uncle Grant. (iii) After the purchase of goods for the weekly market.

B) The cash received in the day amounted to £3,470. Added to the £900 opening balance at the start of the day, this comes to £4,370. But this is not the amount to be shown on the closing balance to the next day, because first we have to subtract all the payments made during 1 September. 37 Part A: Basic Accounting NOTES The payments part of the cash book for 1 September would look like this. CASH BOOK (PAYMENTS) Date Narrative Reference Total 20X7 1 Sept £ Creditor: Kew 120 Creditor: Hare 310 Telephone 400 Gas bill 280 Petty cash 100 Machinery purchase 1,500 Closing balance c/d 1,660 4,370 As you can see, this is very similar to the receipts part of the cash book.

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