Question 2 Since Gullivers travels is growing rapidly there

Question 2 Since Gulliver\'s travels is growing rapidly there is a need for journalizing the financial cth that are taking place in the company. So you are required to ghve the journal entries following data that took place in the month of July. Make use of the following accounts: 010 Building 020 Equipment 040 Equity for the 041 Withdrawals 060 Mortgage 100 Cash 130 Accounts receivable 140 Accounts payable 180 VAT receivable 181 VAT payable 400 Advertising expenses 420 Interest expenses 430 Depreciation expenses 700 Inventories 800 Cost of goods sokd 820 Discounts given 840 Sales revenue 5,800 August 4: Sold: a trip to Hawai to Mr. D. Dekker for VAT 21% 7,018 Invcice V-26 sent. The purchase price of the trip was 4,060 1,100 August 10. Purchased: 2 office chairs for 1- VAT21% Invoice-25 received August 15: Purchased: booked hotel rooms in hotel Medclub in Nice for the summer 1,200 VAT 21% Invoice I- 26 received August 17: Sent back to Office Supply Ltd. 1 office chair 550 115 VAT 21% Credit invoice I -27 received August 21: According to B 35 Paid cash to creditors (suppliers) Paid for advertising expenses, (including 42 VAT) Received cash from debtors 5,400 242 3,100

Solution

Solution :

Journal Entries
Date	Doc	Account	Debit (€)	Credit (€)
4-Aug	V-26	Accounts Receivables Dr	7018
		To Sales Revenue		5800
		To VAT Payable		1218
		(Being Sales recorded )
4-Aug	V-26	Cost of Goods Sold Dr	4060.00
		To Inventories		4060.00
		(Being Inventory transferred to COGS)
10-Aug	I-25	Equipment Dr	1100
		VAT Receivable Dr	231
		To Accounts Payable		1331
		(Being office chair purchased)
15-Aug	I-26	Inventories Dr	1200
		VAT Receivable Dr	252
		To Accounts Payable		1452
		(Being Hotel room booked)
17-Aug	I-27	Accounts Payable Dr	665
		To Equipment		550
		To VAT Receivable		115
		(Being Chair returned)
21-Aug	B 35	Accounts Payable Dr	5400
		To Cash		5400
		(Being Cash paid to creditors)
21-Aug	B 35	Advertising Expenses Dr	200
		VAT Receivable Dr	42	242
		To Cash
		(Being Advertising Expense paid)
21-Aug	B 35	Cash Dr	3100
		To Accounts Receivable		3100
		(Being Cash received from debtors)
23-Aug	V 27	Discounts given Dr	300
		VAT Payable Dr	63
		To Accounts Receivable		363
		(Being discount given to customer)
31-Aug	D 12	Depreciation Expenses Dr	200
		To Equipment		200
		(Being depreciation charged on equiment)
31-Aug	B 36	Cash Dr	5000
		To Equity		5000
		(Being cash introduced in business by owner)