Training Link Level 2 Bookkeeping Controls

Level 2 Bookkeeping Controls
Presented by – Mark Hempinstall

Who are Training Link?
26 Years of Distance Learning
Subject area specialists

• Accounting
• Bookkeeping
• Payroll
This is all we do.
And this niche approach keeps us focused on creating materials and delivering
support of the very highest quality.
What is a control account used
for?
A Control Account is used to bring information into one place from a number of
other accounts.
Examples include
• Receivables Control Account (SLCA/Debtors Control Account)

• Payables Control Account (PLCA/Creditors Control Account)
• Wages Control Account
• VAT Control Account
What is a control account used
for?
Control Accounts are used to bring information into one place from a number of
other accounts.
Examples include
• Receivables Control Account (SLCA/Debtors Control Account)

• Payables Control Account (PLCA/Creditors Control Account)
• Wages Control Account
• VAT Control Account
Recording Payroll Transactions
Using a Wages Control Account
Two main components of payroll costs to an employer
• Gross Wages – The amount earned by the employee
• Employer Contributions – Additional costs to the employer over and above Gross Wages
Gross Wages
Gross Wages - £30,000
Deductions £
Employees NI 3,000
PAYE (Income Tax) 3,500
Membership fees 200
Employees Pension 2,200
Total Deductions 8,900
Net Pay 21,100
Total 30,000
Gross Wages – Total Deductions = Net Pay
£30,000 - £8,900 = £21,100

Employers Contributions
Employers NI 3,300
Employers Pension 3,750
Total 7,050
Accounts used to record these transactions
Wages Expense Account

Wages Control Account
Pension (Liability) Account
HMRC Account
Membership Fees (Liability) Account
Bank Account
The Journal
Dr W a g e s Exp e n s e Ac c o u n t Cr
Gro s s W a g e s 30 ,0 0 0
Em p lo ye rs NI 3,30 0
Em p lo ye rs P e n s io n 3,750
Gro s s W a g e s 30 ,0 0 0
Dr W a g e s Co n t ro l Ac c o u n t Cr
Gro s s W a g e s 30 ,0 0 0
Gro s s W a g e s 30 ,0 0 0
J o u rn a l
Ac c o u n t Na m e Dr CR
Dr W a g e s Co n t ro l Ac c o u n t Cr W a g e s Exp e n s e A/c 37,0 50
Gro s s W a g e s 30 ,0 0 0 W a g e s Co n t ro l A/c 37,0 50
Em p lo ye rs P e n s io n 3,750 J o u rn a l t o re c o rd t h e w a g e s e xp e n s e
Gro s s W a g e s 30 ,0 0 0
Ne t P a y (B a n k A/c ) 21,10 0 Gro s s W a g e s 30 ,0 0 0
1. J o u rn a l
Ac c o u n t Na m e Dr Cr
W a g e s Co n t ro l A/c 21,10 0
Ba n k 21,10 0
En t rie s t o re c o rd p a ym e n t o f n e t w a g e s
1. J o u rn a l
Ba n k 21,10 0
Dr B a n k Ac c o u n t Cr En t rie s t o re c o rd p a ym e n t o f n e t w a g e s
Me m b e rs h ip Fe e s 20 0 Em p lo ye rs NI 3,30 0
2. J o u rn a l
W a g e s Co n t ro l A/c 20 0
Me m b e rs h ip fe e s A/c 20 0
En t rie s t o re c o rd s t a ff m e m b e rs h ip fe e
lia b ilit y
2. J o u rn a l
Dr Me m b e rs h ip Fe e s A/c Cr En t rie s t o re c o rd s t a ff m e m b e rs h ip fe e
W a g e s Co n t ro l A/c 20 0 lia b ilit y
Em p lo ye e s NI 3,0 0 0 Em p lo ye rs P e n s io n 3,750
P AYE (In c o m e Ta x) 3,50 0
Em p lo ye e s P e n s io n 2,20 0
Em p lo ye e s N I 3 ,0 0 0 Em p lo ye rs P e n s io n 3,750
3. J o u rn a l
W a g e s Co n t ro l A/c
HMRC
En t rie s t o re c o rd To t a l HMRC Lia b ilit y
Workings
Employees NI + Employers NI +PAYE
£3,000 + £3,300 + £3,500 = £9,800

3. J o u rn a l
W a g e s Co n t ro l A/c 9,8 0 0
HMRC 9,8 0 0
En t rie s t o re c o rd To t a l HMRC Lia b ilit y
Workings
Employees NI + Employers NI +PAYE
£3,000 + £3,300 + £3,500 = £9,800

3. J o u rn a l
HMRC 9,8 0 0
Dr HMRC Ac c o u n t Cr En t rie s t o re c o rd To t a l HMRC Lia b ilit y

4 . J o u rn a l
Em p lo ye rs P e n s io n 3,7 50
W a g e s Co n t ro l A/c 5,950
P e n s io n Lia b ilit y A/c 5,950
En t rie s t o re c o rd t h e p e n s io n s lia b ilit y

4 . J o u rn a l
Em p lo ye rs P e n s io n 3,7 50
Dr P e n s io n s Lia b ilit y A/c Cr
W a g e s Co n t ro l A/c 5,950 En t rie s t o re c o rd t h e p e n s io n s lia b ilit y
37,0 50 37,0 50
Gro s s W a g e s 30 ,0 0 0
Dr W a g e s Co n t ro l Ac c o u n t Cr Dr B a n k Ac c o u n t Cr
Ne t P a y (B a n k A/c ) 21,10 0 Gro s s W a g e s 30 ,0 0 0 W a g e s Co n t ro l A/c 21,10 0
Dr Me m b e rs h ip Fe e s A/c Cr
Em p lo ye e s P e n s io n 2,20 0 W a g e s Co n t ro l A/c 20 0
37,0 50 37,0 50
Dr HMRC Ac c o u n t Cr
Dr P e n s io n s Lia b ilit y A/c Cr

1. J o u rn a l
Ba n k 21,10 0
En t rie s t o re c o rd p a ym e n t o f n e t w a g e s
Dr W a g e s Co n t ro l Ac c o u n t Cr 2. J o u rn a l
Em p lo ye e s NI 3,0 0 0 Em p lo ye rs P e n s io n 3,750 En t rie s t o re c o rd s t a ff m e m b e rs h ip fe e
P AYE (In c o m e Ta x) 3,50 0 lia b ilit y
Em p lo ye rs NI 3,30 0 3. J o u rn a l
37,0 50 37,0 50
HMRC 9,8 0 0
En t rie s t o re c o rd t o t a l HMRC lia b ilit y
4 . J o u rn a l
En t rie s t o re c o rd t h e p e n s io n s lia b ilit y
Any questions ?
Recording VAT Entries
Using a VAT Control Account
Dr VAT Co n t ro l A/c Cr
Re c o rd s a d e c re a s e in t h e lia b ilit y Re c o rd s a n in c re a s e in t h e lia b ilit y

Am o u n t
Tra n s a c t io n £ Dr Cr
Ba la n c e o w in g t o HMRC a t s t a rt o f p e rio d 2,0 0 0
VAT fro m P u rc h a s e s D a yb o o k 2,90 0
VAT fro m Sa le s D a yb o o k 3,70 0
VAT fro m Sa le s Re t u rn s D a yb o o k 60 0
VAT fro m P u rc h a s e s Re t u n s D a yb o o k 800
VAT To t a l D is c o u n t Allo w e d D a yb o o k 750
VAT To t a l D is c o u n t Re c e ive d D a yb o o k 50 0
VAT re fu n d re c e ive d fro m HMRC 6,4 0 0
Am o u n t
Am o u n t
Am o u n t
Am o u n t
Am o u n t
Am o u n t
Am o u n t
Am o u n t
Am o u n t
Tra n s a c t io n £ Dr Cr Dr VAT Co n t ro l A/c Cr
Ba la n c e o w in g t o HMRC a t s t a rt o f p e rio d 2,0 0 0 P DB 2,90 0 B a l B /d 2,0 0 0

Sa le s Re t u rn s 60 0 SDB 3,70 0
Dis c Allo w e d Da yb o o k 750 P RDB 80 0
VAT fro m P u rc h a s e s Re t u n s D a yb o o k 800 Dis c Re c 'd Da yb o o k 50 0
VAT To t a l D is c o u n t Allo w e d D a yb o o k 750 Re fu n d Re c e ive d 6,4 0 0

Am o u n t
Tra n s a c t io n £ Dr Cr Dr VAT Co n t ro l A/c Cr
Ba la n c e o w in g t o HMRC a t s t a rt o f p e rio d 2,0 0 0 P DB 2,90 0 B a l B /d 2,0 0 0

Sa le s Re t u rn s 60 0 SDB 3,70 0
Dis c Allo w e d Da yb o o k 750 P RDB 80 0
VAT fro m P u rc h a s e s Re t u n s D a yb o o k 800 Dis c Re c 'd Da yb o o k 50 0
VAT To t a l D is c o u n t Allo w e d D a yb o o k 750 B a l C/d 9,150 Re fu n d Re c e ive d 6,4 0 0

VAT To t a l D is c o u n t Re c e ive d D a yb o o k 50 0 13,4 0 0 13,4 0 0

Any questions ?
Thank you for joining us.
For further details visit www.training-link.co.uk

Or call 0800 594 2822
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Training Link Level 2 Bookkeeping Controls

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Level 2 Bookkeeping Controls

Presented by – Mark Hempinstall

26 Years of Distance Learning

Subject area specialists

This is all we do.

• Receivables Control Account (SLCA/Debtors Control Account)

• Receivables Control Account (SLCA/Debtors Control Account)

Two main components of payroll costs to an employer

• Gross Wages – The amount earned by the employee

Gross Wages - £30,000

Gross Wages – Total Deductions = Net Pay

£30,000 - £8,900 = £21,100

Wages Expense Account

En t rie s t o re c o rd To t a l HMRC Lia b ilit y

Employees NI + Employers NI +PAYE

£3,000 + £3,300 + £3,500 = £9,800

En t rie s t o re c o rd To t a l HMRC Lia b ilit y

Employees NI + Employers NI +PAYE

£3,000 + £3,300 + £3,500 = £9,800

Dr HMRC Ac c o u n t Cr En t rie s t o re c o rd To t a l HMRC Lia b ilit y

En t rie s t o re c o rd t h e p e n s io n s lia b ilit y

Dr P e n s io n s Lia b ilit y A/c Cr

Re c o rd s a d e c re a s e in t h e lia b ilit y Re c o rd s a n in c re a s e in t h e lia b ilit y

Ba la n c e o w in g t o HMRC a t s t a rt o f p e rio d 2,0 0 0 P DB 2,90 0 B a l B /d 2,0 0 0

VAT To t a l D is c o u n t Allo w e d D a yb o o k 750 Re fu n d Re c e ive d 6,4 0 0

Ba la n c e o w in g t o HMRC a t s t a rt o f p e rio d 2,0 0 0 P DB 2,90 0 B a l B /d 2,0 0 0

VAT To t a l D is c o u n t Allo w e d D a yb o o k 750 B a l C/d 9,150 Re fu n d Re c e ive d 6,4 0 0

VAT re fu n d re c e ive d fro m HMRC 6,4 0 0

For further details visit www.training-link.co.uk

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