CHAPTER 4 Business transactions 1454.3 Nicholas Cash, owner of Advantage Tennis Coaching (ATC), commenced business in September
- Refer to illustrative examples 4.1, 4.4, 4.5, 4.6 and 4.7 for background information relating to
the operations of the business and transactions in the first month of trading, September 2016. The
following transactions occurred in October 2016.
2016October 2
7
10
12
18
22
25
26
27
28
30Received payment from Tennis Queensland for ATC invoice dated 4 September for $3000.
Paid this month’s rent $1000.
The business banked $5600 cash from coaching fees.
Nicholas withdrew $1500 for personal use.
Paid invoice for $1400 received from Office R Us for an office desk purchased last month.
Paid A Faff $4500 for performing coaching services at Indooroopilly Tennis Club.
Invoiced Indooroopilly Tennis Club $6900 for coaching services.
Banked cash $12 000 from coaching fees.
Received $3800 from TJB for services invoiced last month.
Paid casual coaching wages $2500.
Purchased coaching equipment for $48 800.Required
a. Prepare journal entries for the October transactions for Advantage Tennis Coaching.
b. Post journal entries to the general ledger accounts.
c. Prepare a trial balance for Advantage Tennis Coaching as at 31 October 2016. The trial balance will
include transactions from September 2016.
SOLUTION TO 4.3
a. Journal entries
Date Name of account Dr Cr
2/10 Cash
Accounts receivable — Tennis Queensland3 000
3 000
7/10 Rent expense
Cash1 000
1 000
10/10 Cash
Coaching fees5 600
5 600
12/10 Drawings — Nicholas Cash
Cash1 500
1 500
16/10 Stationery expense
Cash600
600
18/10 Accounts payable
Cash1 400
1 400
22/10 Wages expense
Cash4 500
4 500
25/10 Accounts receivable
Coaching fees6 900
6 900
26/10 Cash
Coaching fees12 000
12 000
27/10 Cash
Accounts receivable —TJB3 800
3 800
30/10 Wages expense
Cash2 500
2 500
30/10 Coaching equipment
Cash48 800
48 800