ACCOUNTING PRACTICES ACCOUNTING PRACTICES ASSIGNMENT
PART A - BLUE SURF LIMITED
This section is worth 25% of your final course mark.
On 1 January 2017 you, the owner of Blue Surf (Your name), decided to start using Xero accounting software to process your transactions. You sell three main types of inventory: Bodyboards, Surfboards, and SUPs (Stand-up Paddle Boards). You also offer a surfboard repair service.
Set up your company
- Start a new Trial Organisation
- Change the name to Blue Surf (Your name& ID number)
- Import the CSV Chart of Accounts file for Blue Surf (Your name) - CoA-bluesurf-student.csv
- Add the highlighted accounts in the trial balance and the additional accounts list below. Note for Capital and Drawings edit the account names to include your name.
The following additional accounts are required to be added to the imported Chart of Accounts file:
|
Code
|
Account Name
|
Account Type
|
Tax details
|
|
201
|
Bodyboard Sales
|
Sales
|
15% GST on income
|
|
202
|
Surfboard Sales
|
Sales
|
15% GST on income
|
|
203
|
SUP Sales
|
Sales
|
15% GST on income
|
|
211
|
Surfboard Repair Fees
|
Other Income
|
15% GST on income
|
|
301
|
Bodyboard COGS
|
Direct costs
|
No GST
|
|
302
|
Surfboard COGS
|
Direct costs
|
No GST
|
|
303
|
SUP COGS
|
Direct costs
|
No GST
|
|
601
|
Bodyboard Inventory
|
Inventory
|
15% GST on expenses
|
|
602
|
Surfboard Inventory
|
Inventory
|
15% GST on expenses
|
|
603
|
SUP Inventory
|
Inventory
|
15% GST on expenses
|
|
432
|
Bank Charges
|
Expense
|
No GST
|
|
434
|
Shop Insurance
|
Expense
|
15% GST on expenses
|
|
811
|
Total Engineering*
|
Current Liability
|
No GST
|
|
* The supplier, in this example, for the credit purchase of plant or equipment
|
Enter conversion balances as follows:
- Set the Conversion date to 1 January 2017
- Enter the opening/conversion balances from the trial balance at 31 December 2016.
- Complete the opening balance invoice for the accounts receivable and the opening balance bill for accounts payable.
Blue Surf (Your name) has the following balances (account type and tax details in brackets for accounts you need to add) on 31 December 2016:
Blue Surf (Your name) Trial Balance as at 31 December 2016
|
Code
|
Account Name
|
Debit
|
Credit
|
|
610
|
Accounts Receivable*
|
2,990
|
|
|
800
|
Accounts Payable**
|
|
2,294
|
|
621
|
Bank - Blue Surf (Xero bank account)
|
2,800
|
|
|
699
|
Inventory Adjustment
|
22,500
|
|
|
730
|
Shop Fittings
|
60,000
|
|
|
731
|
Accumulated Depreciation on Shop Fittings
|
|
13,400
|
|
740
|
Repair Equipment (Fixed Asset, 15% GST on expenses)
|
24,000
|
|
|
741
|
Accumulated Depreciation on Repair Equipment (Fixed Asset, No GST)
|
|
4,576
|
|
820
|
GST
|
|
1,020
|
|
905
|
Loan - MNZB
|
|
19,000
|
|
971
|
Capital - Your Name
|
|
72,000
|
|
|
|
112,290
|
112,290
|
|
* The Accounts Receivable represents $2,990 owed by Paddle Safe.
**The Accounts Payable represents $2,294 owed to Surf Co,
|
Add Inventory items as follows:
- Set up the following inventory items for (Your name) Blue Surf Ltd as tracked inventory
- Use separate inventory, cost of goods sold and sales accounts for each eg for Bodyboards use Bodyboards Inventory, Bodyboards COGS, and Bodyboards Sales
- Enter the quantity on hand for each inventory item using an Inventory Adjustment entry increasing the quantity
|
|
Bodyboards
|
Surfboards
|
SUPs
|
|
Cost price excluding GST
|
$42.00
|
$399.00
|
$684.00
|
|
Selling price excluding GST
|
$86.00
|
$746.00
|
$1,300.00
|
|
Quantity on hand
|
20
|
20
|
20
|
Required:
The following transactions occurred in the month of January, process the following transactions in Xero:
|
Date
2017
|
Transaction
All amounts include GST where relevant unless otherwise stated
All invoices and bills have a due date on 20 February 2017
|
|
Jan 4
|
Purchased 7 bodyboards and 5 SUPs on credit from Sea Gear.
|
|
Jan 4
|
Purchased 10 surfboards on credit from Surf Co.
|
|
Jan 7
|
Paid KiwiSurf for marketing $1,362.75 using online bill payment #7210.
|
|
Jan 7
|
Cash sales (EFTPOS): 6 bodyboards, 4 surfboards and 2 SUPs
|
|
Jan 7
|
Cash received for surfboard repairs (EFTPOS) $235.70
|
|
Jan 8
|
Sold 5 bodyboards and 8 surfboards to Raglan Surf School on credit. Gave them a 15% discount on the body boards and a 20% discount on the surfboards. Record each discount in the discount column of the invoice.
|
|
Jan 11
|
Sold 5 SUPs to Paddle Safe on credit.
|
|
Jan 12
|
Used the business EFTPOS card at The Warehouse, total $147.99. Of this $120.00 cash out was for personal expenses, the remainder was for business stationery. Business stationery is included in the Stationery Expense account.
|
|
Jan 14
|
Paddle Safe returned 1 SUP purchased on 11 January 2017
|
|
Jan 15
|
Returned 2 bodyboards purchased on 4 January 2017 to Sea Gear.
|
|
Jan 15
|
Paid B Kane $2,725.73 for wages by online bill payment #3100
|
|
Jan 16
|
Received $297.90 (EFTPOS) for surfboard repairs
|
|
Jan 16
|
Cash sales (EFTPOS): 3 SUPs
|
|
Jan 16
|
Paid monthly Xero account $55 by online bill payment #2001. The Xero account is included in Office Expenses.
|
|
Jan 21
|
Paid Surf Co $1,500 in part payment of the amount due on 31 December 2016. Bill payment #4100
|
|
Jan 21
|
Charged Sam Hewitt $100 for surfboard repairs.
|
|
Jan 22
|
Monthly cash drawings transferring $4,500 from the business bank account to your personal bank account.
|
|
Jan 25
|
Cash sales (EFTPOS): 5 Bodyboards, 3 Surfboards and 4 SUPs
|
|
Jan 28
|
Pacific Media charged $2,400 for advertising in NZ Surfing magazine. Advertising is included in the Marketing account.
|
|
Jan 28
|
Import the bank statement file BS-surf.csv and complete the bank reconciliation process
Note:
? Telco Direct Debit is for Phone & Website
? Max Energy Direct Debit is for Electricity
? A2 Property Direct Debit is for Shop Rent
? Direct credit from Paddle Safe is in full settlement of their
31 December 2016 balance
? Direct credit from Raglan Surf is in part payment of their invoice.
Other items should be self explanatory
|
|
Jan 30
|
You gave one SUP to your dad for his birthday.
|
|
Jan 31
|
Last month Accountancy fees of $253.20 was posted in error to office expense. Correct this error.
|
Required:
- View your journal report for 31 December to 31 January 2017 and export it to a PDF file. Save the file and submit on Canvas.
- View the Profit and Loss report for the period 1 January 2017- 31 January 2017 and export it to a PDF file. Save the file and submit on Canvas.
- View the Balance Sheet report for the period as at 31 January 2017 and export it to a PDF file. Save the file and submit on Canvas.
- View Bank Account Transactions report for the date range 31 Dec 2016 - 31 Jan 2017 and export it to a PDF file. Save the file and submit on Canvas.
PART B - PAPATOETOE MANUFACTURING CASH BUDGET
This section is worth 5% of your final course mark.
The following table shows the information provided by Papatoetoe Manufacturing for the purpose of preparing a monthly cash budget. Using the Excel spreadsheet that is saved on your exam drive, prepare a cash budget for the months of October, November and December 2017 and show the quarterly totals.
|
Estimated figures
|
October
|
November
|
December
|
|
Cash sales
|
45,000
|
58,000
|
80,000
|
|
Credit sales
|
120,000
|
95,000
|
110,000
|
|
|
|
|
|
|
Cash purchases
|
32,000
|
35,000
|
36,000
|
|
Credit purchases
|
45,000
|
48,000
|
59,000
|
|
Wages
|
15,000
|
18,000
|
16,000
|
|
Motor vehicle purchase
|
|
60,000
|
|
All figures are GST inclusive where applicable.
The following are additional notes on completing the cash budget:
- Actual cash sales in July, August and September 2017 were $38,000, $42,000 and $40,000 respectively
- Actual credit sales in July, August and September 2017 were $90,000, $100,000 and $95,000 respectively.
- Accounts receivable settle their accounts as follows: 75% in the month following sale and 25% two months following sale
- Commercial rent income is $6,000 per month for 2016
- Actual cash purchases in July, August and September 2017 were $29,000, $30,000 and $28,000 respectively.
- Actual credit purchases in July, August and September 2017 were $45,000, $65,000 and $49,000 respectively.
- Accounts payable are paid as follows: 100% in the month following the purchase
- Other operating expenses are $15,000 per month for 2016 which includes an amount of $2,000 per month for depreciation.
- GST is 15% on invoice basis and Net GST owing is paid in the month following after sales and purchases have been incurred
- Show totals for the quarter.
- Bank balance at 30th September was $8,000.
The company has a new policy starting from Oct 2016 where a minimum closing cash balance of $40,000 is required for every month. Any excess over $40,000will be used to pay back the loan. Assume that there is no borrowing at the end of September 2016.
Please ensure you use formulae to calculate your cash budget. Marks will be deducted for entering numbers when formulae can be used.
Required:
- Download the excel data file "Accounting Practices Assignment Q1 2017 PART B Cash budget data file.xls" from canvas.
- Save the file with your name and ID number as the file name.
- Complete the cash budget spreadsheet and submit.
Attachment:- Assignment Files.rar