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SOURCE DOCUMENTS: CONTINUED, ANSWERS TO ASSIGNMENT # 2 AND ASSIGNMENT# 3


LEARNING OUTCOMES:

 THE STUDENTS SHALL BE ABLE TO UNDERSTAND THE SOURCE DOCUMENTS:
DONE IN THE PREVIOUS CLASS
* CASH MEMO
*INVOICE OR BILL
*RECEIPT
*PAY-IN -SLIP
*CHEQUE

 TO BE DONE TODAY

 *DEBIT NOTE
*CREDIT NOTE

 VOUCHERS - MEANING

 ANSWERS TO ASSIGNMENT # 2 AND # 3


TASK # 2

 SOURCE DOCUMENTS CONTINUED

1) Debit Note:

 when we return goods to a supplier, we prepare a debit note and send it to the supplier with the returned goods. Debit note is a document which indicates that suppliers account is being debited. It is a source document which contains the date of transaction, the name of account which is debited, the amount and the reasons for debit.








(2) Credit Note: 

When goods are received back from a customer a Credit note is sent to him indicating that the customer's account has been credited in our books.




Vouchers- Meaning

A voucher is a written document that acts as an evidence of any business transaction. All source documents are vouchers. For examples, cash memos, invoice or bill, receipt and pay-in-slips, etc.
TASK #3

 WATCH THE INTERESTING VIDEO ON SOURCE DOCUMENTS






TASK # 4

 PLEASE DO CHECK THE ANSWERS AND TRY TO UNDERSTAND THE CONCEPTS



ANSWERS TO ASSIGNMENT # 2


 QUESTION 1.
Fill in the Blanks: 

1. Amount which the proprietor has invested in a business is known as____.

2.  Amount which the firm owes to the outsiders is known as ______.

3. _____ is the cost incurred in producing goods and services.

4. Revenue means the income of a _____ nature. 

5. The term 'sales' is used only for the sales of ______ and is never used for the sale of ______.

6. The persons who still owe some amount to the business are termed as ______.

7. The persons to whom money is owing by the firm are termed as ______.

8. Assets held for continued use in the business and not meant for resale are termed as ______.

9. ______ are those assets which have a physical existence and which have been which can be seen or felt.

10. ______ refer to those liabilities which are to be paid normally within one year.

PLEASE CHECK THE ANSWERS:

1 Capital
2 Liabilities
3 Expense
4 Regular or recurring
5 Goods, Assets
6 Debtors
7 Creditors
8 Fixed assets
9 Tangible assets
10 Current liabilities



QUESTION 2.


READ THE BUSINESS TRANSACTIONS OF ' PARAG & COMPANY'  GIVEN BELOW



Mr. PARAG commenced business in electronic goods with a initial capital of Rs.1500000.

Out of the said Rs.1500000 he paid Rs.1000000 towards purchase of goods. 

He further spent Rs.200000 on furnishing the shop and Rs.35000 for purchase of computer and printer. 
Rs.10000 in yet to paid to the supplier of computer.

He sold goods costing Rs.500000 for Rs.700000 in cash and
 goods costing Rs.250000 for Rs.310000 on credit. 

Goods sold on credit for Rs.25000 were returned being defective. 

These goods costing Rs.20000 were returned to the supplier.

Looking into the response he decided to trade in home appliances for Rs.800000 out of which purchases of Rs.200000 were on credit.

Due to earthquake 2 LCD Television costing Rs.50000 were completely destroyed.

Mr.Parag received an insurance claim of Rs.30000.

A Customer purchased goods costing Rs.225000 for Rs.300000 and was allowed a discount of Rs.15000.
He was further allowed discount of Rs.5000 for payment within agreed time.

He paid salary to shyam of Rs.55000, Rs.5000 yet to be paid.

He insured the goods and paid insurance premium of Rs.10000 out of this Rs.5000 are for the next year.

Mr Parag withdrew Rs.30000 for his personal use.

You are required to answer the following questions.

01. What is the amount of the capital?

02. What is the amount of the fixed assets?

03. What is the amount of purchases?

04. What is the amount of long term liabilities?

05. What is the amount current liabilities?

06. How much expenses incur during the year?

07. What is the amount of prepaid expenses?

08. What is the amount of outstanding expenses?

09. What is the amount due from debtors?

10. What is the amount due to creditors?

11. What is the value closing stock?

12. What is the amount of trade discount?

13. What is the amount of cash discount?

14. What is the amount of drawings?

15. What is the amount of sales return?

16. What is the amount of purchase return?



PLEASE CHECK THE ANSWERS:

Answers
(1) Opening Capital = 15,00,000

(2) Fixed Assets = Building (Shop)+Computer & Printers

          = 2,00,000 + 35,000 = 2,35,000

(3) Purchases = Purchases(total) - Purchase Returns - Loss of purchases by Earthquake

        = 10,00,000 + 8,00,000 - 20,000 - 50,000 = 17,30,000

(4) Long Term Liabilities = Nil

(5) Current Liabilities = Supplier of Computer and Printers+ Creditors(Net)

              = 10,000 + 1,80,000(2,00,000 - 20,000)

               = 1,90,000

(6) Expenses = Discount Allowed + Salary + Insurance Expenses + Loss by Earthquake (Net)

        =  5,000 + 60,000 + 5,000 + 20,000 (50,000 - 30,000)

        = 90,000

(7) Prepaid Expenses = Prepaid Insurance

              = 10,000

(8) Outstanding Expenses = Outstanding Salary

                = 5,000

(9) Debtors = 3,10,000 + 2,85,000 - 25,000 = 5,70,000

(10) Creditors = 2,00,000 - 20,000 = 1,80,000

(11) Closing Stock = Opening Stock + Purchases(Net) - Sales(Net)

            = 0 + 17,30,000 - 12,70,000(7,00,000+3,10,000+2,85,000-25,000) 

            = 4,60,000

(12) Trade Discount = 15,000

(13) Cash Discount = 5,000

(14) Drawings = 30,000

(15) Sales Return = 25,000

(16) Purchases Return = 20,000 


ASSIGNMENT # 3


1.According to the ____principle, the stock is valued at lower of cost or net realizable value.

2.According to______ personal transactions of the owner are kept separate from the business.

3. Accounting records only those transactions, which can be measured in terms of _____.

4. All transactions are recorded in the books from the _____ point of you.

5. Recognition of expenses in the same period as associated revenues is called ________concept.

6. The accounting concept that refers to the tendency of accountants to resolve uncertainty and doubt in favour of understanding assets and revenues and overstating liabilities and expenses is known as ______.

7. The fact that business is separate and indistinguishable from its owner is best exemplified by the______ concept.

8. Everything a firm owns, it also owes out to somebody. This co-incidence is explained by the_______ concept.

9. If a firm believes that some of its debtors may default, it should act on this by making sure that all possible losses are recorded in the books. This is an example of the_____ concept.

10. The management of a firm is remarkably incompetent, but the firms accountants cannot take this into account while preparing book of accounts because of______ concept.
PLEASE CHECK THE ANSWERS TO ASSIGNMENT # 3

1 Prudence
2 Business entity
3 Money measurement
4 Business
5. Matching
6. Conservatism
7. Business entity
8. Dual aspect
9. Conservatism
10. Money measurement









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