4.7 Transferring the auxiliary journals to the ledger  (Page 27/3)

Economic and management sciences

Grade 9

Business, consumer and financial knowledge and skills

Module 22

Transferring the auxilliary journals to the ledger

ACTIVITY 1:

To transfer the auxiliary journals to the ledger

[LO 3.3]

Once the entries in the auxiliary journals have been completed, all the information is transferred to the ledger.

The column totals of the CRJ are transferred on the last day of the month and the entries in the sundries column are transferred individually on the date of the entry.

Cash received by a service enterprise is transferred as follows to the CRJ:

1. Bank account – debit with the total cash received (Asset increases on the debit side).

2. Current Income account – credit with the total for the month (Ownership interest increases on the credit side).

3. Capital account – credit with the capital amount deposited (Ownership interest increases on the credit side).

The names of the other accounts involved appear in the “details” column of the ledger.

In the case of the bank account - capital and current income (total receipts)In the case of the capital account - bankIn the case of the current income account - bank

ASSIGNMENT 1: Transfer of the CRJ in a Service Enterprise

• Use the completed CRJ of Mzondi Plumbers (Activity 3.1 Assignment 1) and transfer the CRJ to the ledger. (Supply your own ledger paper to complete the activity.)

ASSIGNMENT 2: Transfer of the CRJ in a Commercial Enterprise

• Use the completed CRJ of Levubu Dealers (Activity 3.1 Assignment 2) and transfer the CRJ. (Supply your own ledger paper to complete the activity.)

• The same principles apply. The transfer is done as follows:

1. Bank account – debit with the total receipts for the month (Asset increases on the debit side.)

2. Capital account – credit with all capital deposited during the month(Ownership interest increases on the credit side.)

3. Sales account – credit with the sales for the month(Ownership interest increases on the credit side.)

4. Selling costs – debit with the amount for the month(Ownership interest decreases on the debit side.)

5. Trading inventory – credit with cost price of the sales amount(Asset decreases on the credit side.)

Bank account – Double entry is total receipts

Capital – Double entry is bank accountSales – Double entry is bank account

Selling costs – Double entry is trading inventory

ASSIGNMENT 3: transfer of the CPJ

• Use the completed journals of Levubu Dealers (Activity 3.1 Assignment 2) and transfer the CPJ. (Supply your own ledger paper.)

• The total of the bank column and all the other columns is transferred on the last day of the month. The entries in the sundries column are transferred as individual amounts to the specific account on the date of the entry.

• The transfer is done as follows:

1. Bank account – credit with the total payments for the month(Asset decreases on the credit side.)

2. Assets purchased for cash – debit every asset separately with the relevant amount(Assets increase on the debit side.)

3. Expenditure paid by cheque – debit each expenditure separately with the relevant amount(Ownership interest decreases on the debit side.)