SUPPLEMENTARY REVISION SOLUTIONS

QUESTION 3

DR TRUST CASH BOOK CR

EFT Adams 120 000 CIPC - Adams 500
Deposit Abel 500 000 Sec 86(4) Nedbank 500 000
Proforma Costs Abel 215 000 Transfer Duty - Abel 100 000
Sec 86(4) : Cap + Interest 505 000 To LPFF -Interest 250
Guarantee - Abel 1 500 000 To Abel Interest 4 750
To Adams - proceeds 2 000 000
Transfer to BCB 3 450
Transfer to BCB 115 000
To Adams -Refund 116 050

DR ADAMS TRUST LEDGER CR

TCB - CIPC 500 TCB EFT 120 000
TCB - Proceeds 2 000 000 From Abel 2 000 000
Value Transfer 3 450
From TCB - Refund 116 050

DR ABEL TRUST LEDGER CR

TCB - Transfer Duty 100 000 TCB Deposit 500 000
TCB -interest 4 750 TCB Proforma costs 215 000
To Adams 2 000 000 Sec 86(4) Interest 4 750
Value Transfer 115 000 TCB Guarantee 1 500 000

DR SECTION 86(4) NEDBANK - ABEL CR

TCB - Investment 500 000 TCB: Cap + Interest 505 000
LPFF - 5% interest 250
Abel - 95% interest 4 750

DR LPFF CR
TCB - interest 250 Sec 86(4) Interest 250
DR BUSINESS CASHBOOK CR
Capital 150 000 Rent 23 000
Transfer from TCB 3 450
Transfer from TCB 115 000

DR ADAMS BUSINESS LEDGER CR

Fee & Vat 3 450 Value Transfer 3 450

DR ABEL BUSINESS LEDGER CR

Fee & Vat 115 000 Value Transfer 115 000

DR FEE CR
Adam Business 3 000
Abel Business 100 000

DR VAT OUTPUT CR
Adam Business 450
Abel Business 15 000

DR RENT CR
BCB 20 000

DR VAT INPUT CR
BCB 3 000
FEE JOURNAL
Details Dr Cr
Adams Business 3 450
Fee 3 000
Vat Output 450
Company registration fee

FEE JOURNAL
Dr Cr
Abel business 115 000
Fee 100 000
Vat output 15 000
Conveyancing fee

TRUST JOURNAL
Dr Cr
ABEL TRUST 2 000 000
ADAM TRUST 2 000 000

Transfer of purchase price proceeds

TRANSFER JOURNAL
Dr Cr
ADAM TRUST 3 450
ADAM BUSINESS 3 450
Value transfer

TRANSFER JOURNAL
Dr Cr
ABEL TRUST 115 000
ABEL BUSINESS 115 000
Value transfer
QUESTION 1 INSTRUCTED CORRESPONDENT

DR TRUST CASH BOOK CR

Collection : Correspondent 12 000 Transfer to BCB 2 110
To Correspondent 9 890

DR CORRESPONDENT TRUST LEDGER CR

Value Transfer 2 110 TCB Collection 12 000
From TCB 9 890

DR BUSINESS CASH BOOK CR

Transfer from TCB 2 110 Sheriff: Correspondent 500

DR CORRESPONDENT BUSINESS LEDGER CR

Fee + Vat 1 035 Allowance 345
BCB Sheriff 500 Allowance 460
Fee + Vat 1 380 Value Transfer 2 110

DR FEE LEDGER CR
Allowance 300 Correspondent Business 900
Allowance 400 Correspondent Business 1 200

DR VAT OUTPUT LEDGER CR

Allowance 45 Correspondent Business 135
Allowance 60 Correspondent Business 180
FEE JOURNAL

DETAILS DR CR
Correspondent Business 1 035
Fee 900
Vat output 135
Letter of demand
Fee 300
Vat output 45
Correspondent Business 345
allowance granted
Correspondent Business 1 380
Fee 1 200
Vat output 180
Collection commission
Fee 400
Vat output 60
Correspondent Business 460
allowance granted

TRANSFER JOURNAL

Correspondent Trust 2 110

Correspondent Business 2 110
Value Transfer
QUESTION 2

2.2
2.2 Trust
Busin
Client 2.1 Trust - Business 2.1 Business -Trust Balance after
ess
transfer
Balan
Hafeez 5 000 0 10 000 0
Bumrah 10 000 0 0 8 000
Stokes 0 3 000 0 5 000
Keshav 0 0 0 7 000
KG 0 20 000 22 000 0
Steyn 0 0 12 000 0

2.3 Rule 54.14.11

Transfer an amount of R3 000 from the Business bank account to Trust Bank Account.
Immediately report in writing to the Legal Practice Council
report should include a written explanation of reason/s for the debit balance and proof of rectification.

Entries.
Dr Stokes Business Ledger - 3000
Cr Stokes Trust Ledger - 3000
(Via transfer journal)

Dr TCB - 3000
Cr BCB - 3000
QUESTION 4 INSTRUCTED CORRESPONDENT

DR TRUST CASH BOOK CR

Cash: Correspondent 15 000 Transfer to BCB 1 810
To Correspondent 13 190

DR CORRESPONDENT TRUST LEDGER CR

Value Transfer 1 810 TCB Cash 15 000
From TCB 13 190

DR BUSINESS CASH BOOK CR

Transfer from TCB 1 810 Sheriff: Correspondent 200

DR CORRESPONDENT BUSINESS LEDGER CR

Fee + Vat 690 Allowance 230
BCB Sheriff 200 Allowance 575
Fee + Vat 1 725 Value Transfer 1 810

DR FEE LEDGER CR
Allowance 200 Correspondent Business 600
Allowance 500 Correspondent Business 1 500

DR VAT OUTPUT LEDGER CR

Allowance 30 Correspondent Business 90
Allowance 75 Correspondent Business 225
FEE JOURNAL

DETAILS DR CR
Correspondent Business 690
Fee 600
Vat output 90
Letter of demand
Fee 200
Vat output 30
Correspondent Business 230
allowance granted
Correspondent Business 1 725
Fee 1 500
Vat output 225
Collection commission
Fee 500
Vat output 75
Correspondent Business 575
allowance granted

TRANSFER JOURNAL

Correspondent Trust 1 810

Correspondent Business 1 810
Value Transfer
QUESTION 5 : INSTRUCTING CORRESPONDENT: STEPS

DR TRUST CASH BOOK CR

Correspondent -T 13 190 To BCB 805
To David 12 385

DR CORRESPONDENT TRUST LEDGER CR

David - T 15 000 TCB 13 190
Value Transfer 805 David - T 2 615

DR DAVID TRUST LEDGER CR

Correspondent -T 2 615 Correspondent - T 15 000
From TCB 12 385

DR BUSINESS CASH BOOK CR

From TCB 805 Value transfer 805

DR CORRESPONDENT BUSINESS LEDGER CR

Fee + Vat 805

DR FEE LEDGER CR
Correspondent - B 700

DR VAT OUTPUT LEDGER CR

Correspondent - B 105
FEE JOURNAL

DETAILS DR CR
Correspondent Business 805
Fee 700
Vat output 105
Fees shared

TRANSFER JOURNAL

Correspondent Trust 805

Correspondent Business 805
Value Transfer

TRUST JOURNAL
DETAILS DR CR

Correspondent - T 15 000
David - T 15 000
Amount collected

David - T 2 615
Correspondent -T 2 615
Costs incurred

STEP 1 13 190
STEP 2 15 000
STEP 3 2 615
STEP 4 805
QUESTION 6

SUPPLEMENTARY CASHBOOK FOR FEBRUARY 2021

DR CR

Balance 25 000 Incorrect entry 18 629

Correct entry 18 269 Bank charges 500
Reverse post dated EFT 21 600 Interest on overdraft 1 200
EFT from client 15 100 Stop order 1 150
Debit order 20 000
Balance c/f 38 490
79 969 79 969

Balance b/d 38 490

BANK RECONCILIATION STATEMENT FOR FEBRUARY 2021

DETAILS DR CR

Balance per bank statement 15 000

Ountstanding EFT 38 500
Bank error - Trust payment 14 990
Balance per sup cashbook 38 490
53 490 53 490