13. Organising the bookkeeping system Flashcards
Sales ledger
receivables/ debtors ledger
Separate account for each customer
Not the same as the sales T account
Purchase ledger
payables/ bought/ creditors ledger
Separate account for each supplier
Not the same as the purchases T account
Cash book
how much money we have in the bank
May have separate petty cash book
Nominal ledger
general ledger
Advantages of nominal ledger
individual accounts located more easily
workload can be shared
segregation of duties
books of prime entry
where transactions are first recorded
daybooks i.e. sales day book list of sales made on credit, purchases daybook list of purchases made on credit
daybook contents
most details from invoices i.e. invoice number & date name and address of supplier description price tax total discounts payment due date
Purchase daybook double entry
DR purchases
DR sales tax
CR payables
Sales daybook double entry
DR receivables
CR sales tax
CR sales account
Returns in daybook double entry
DR returns inwards
DR sales tax
CR receivables
Returns out daybook double entry
DR payables account
CR sales tax
CR returns outwards account
Petty cash
same as cash book but dealing with notes and coins
Imprest petty cash system
whats in the petty cash box reconciles back to a sum of money i.e. £100 imprest, withdraw £10 on coffee = £90 cash + £10 coffee receipt. End of day value of receipts written up in petty cash book and receipts value replaced with cash
The Journal
Where you note transactions that don’t naturally fall into the normal books of prime entry i.e. year end adjustments, bad and doubtful debts, accruals and prepayments, inventory
Layout of the journal
Date, account name, debit, credit, explaination
