LEARNING UNIT 4 – DOUBLE ENTRY SYSTEM

Exercise 1
The following transactions relate to Sweets Traders for March 2018.

• The owner started the business on 1 March with a R60 000 cash capital contribution.
• On 2 March, the business purchased the following items cash:
o Motor vehicle, R20 000
o Inventory, R20 000
o Stationery, R500
• On 5 March, the business sold inventory with a selling price of R35 000 and a cost
price of R15 000 for cash.
• On 7 March, the business sold inventory with a selling price of R8 000 and a cost
price of R3 500 on credit.
• On 8 March, the business paid wages of R1 500 with a cheque.
• On 12 March, the business purchased office furniture on credit for R1 955.
• On 17 March, the business purchased inventory on credit for R72 700.
• On 18 March, the business sold inventory with a selling price of R42 000 and a cost
price of R18 200 on credit.

Required
Record all these transactions in the general ledger.

Exercise 2
The following transactions relate to Chips Traders for January 2018.

• The owner started the business on 1 January with a R150 000 cash capital
contribution.
• On 2 January, the business purchased the following items on credit:
o Inventory, R155 000
o Office furniture, R25 000
• On 7 January, the business sold inventory with a selling price of R25 000 and a cost
price of R15 000 on credit.
• On 9 January, the business paid wages of R2 500 with a cheque.
• On 11 January, the business sold inventory with a selling price of R35 000 and a cost
price of R21 000 for cash.
• On 13 January, the business purchased inventory cash for R10 500.
• On 15 January, the business received an invoice for R185 from a supplier for repairs
done.
• On 19 January, the business donated R15 to a local charity.
• On 23 January, the business paid R100 for advertising.
• On 28 January, the business received R25 000 from a debtor.

Required
Record all these transactions in the general ledger.
Exercise 3
The following transactions relate to Popcorn Traders for March 2018.
• The owner started the business on 1 March with a R80 000 cash capital contribution.
• On 4 March, the business purchased the following items on credit:
o Inventory, R50 000
o Machinery, R20 000
• On 7 March, the business sold inventory with a selling price of R10 000 and a cost
price of R4 000 on credit.
• On 10 March, the business paid wages of R1 763 with a cheque.
• On 15 March, the business purchased inventory on credit for R25 100.
• On 16 March, the business purchased computers on credit for R1 750.
• On 18 March, the business received R10 000 from a debtor.
• On 19 March, the business paid R40 000 to a creditor.
• On 23 March, the business received an invoice for R775 for shelving installed.
• On 25 March, the owner took R180 cash for personal use.
• On 27 March, the business paid for the following:
o Telephone, R156
o Municipal charges, R110
• On 30 March, the business paid R30 000 to a creditor.

Required
Record all these transactions in the general ledger.

Exercise 4
The following transactions relate to Pretzel Traders for January 2018.
• The owner started the business on 1 January with a R60 000 cash capital
contribution.
• On 2 January, the business purchased land and buildings for R58 000 cash.
• On 3 January, the business purchased equipment for R3 500 on credit.
• On 4 January, the owner took R2 500 cash for personal use.
• On 5 January, the business purchased inventory for R6 500 cash.
• On 6 January, the business sold inventory with a selling price of R600 and a cost
price of R400 on credit.
• On 7 January, the business purchased a vehicle for R12 500 on credit.
• On 8 January, the business purchased inventory for R2 400 on credit.
• On 9 January, the business sold inventory with a selling price of R1 200 and a cost
price of R800 cash.
• On 10 January, the business purchased inventory for R2 000 on credit.

Required
Record all these transactions in the general ledger.
Exercise 5
The following transactions relate to Candy Traders for July 2018.
• The owner started the business on 1 July with a R75 000 cash capital contribution.
• On 2 July, the business purchased land and buildings for R45 000 cash.
• On 4 July, the business purchased equipment for R12 500 on credit.
• On 5 July, the business purchased inventory for R6 000 on credit.
• On 6 July, the business sold inventory with a selling price of R100 and a cost price of
R80 for cash.
• On 7 July, the business paid R12 500 to accounts payable.
• On 8 July, the business paid R70 for an annual licence.
• On 9 July, the business sold inventory with a selling price of R400 and a cost price of
R320 on credit.

Required
Record all these transactions in the general ledger.

Exercise 6
The following transactions relate to Ice Cream Traders for January 2018.
• The owner started the business on 3 January with a R20 000 cash capital
contribution.
• On 7 January, the business purchased equipment for R10 000 cash.
• On 9 January, the business purchased inventory for R25 000 on credit.
• On 11 January, the business purchased computers for R5 000 cash.
• On 15 January, the business sold inventory with a selling price of R10 000 and a cost
price of R5 000 cash.
• On 20 January, the business paid salaries of R1 000 cash.
• On 22 January, the business purchased inventory for R6 000 cash.
• On 23 January, the business sold inventory with a selling price of R5 000 and a cost
price of R2 500 on credit.

Required
Record all these transactions in the general ledger.