Answer:
a) Ledger Accounts:
1) Capital Account
Debit Credit Balance
Cash GH¢16,000 GH¢16,000
Cash Account
Date Debit Credit Balance
July 1 Capital GH¢16,000 GH¢16,000
July 2 Bank GH¢8,000 GH¢8,000
July 8 Stationery GH¢150 GH¢7,850
July 8 Purchases GH¢5,000 GH¢2,850
July 17 Insurance GH¢100 GH¢2,750
July 18 Sales GH¢2,500 GH¢5,250
July 20 Bank GH¢2,700 GH¢2,550
July 25 Motor Expenses GH¢300 GH¢2,250
3) Bank Account
Date Debit Credit Balance
July 2 Cash GH¢8,000 GH¢8,000
July 2 Purchases GH¢1,000 GH¢7,000
July 5 Motor Van GH¢4,000 GH¢3,000
July 20 Cash GH¢2,700 GH¢5,700
July 22 Drawing GH¢1,000 GH¢4,700
July 28 Sales GH¢5,400 GH¢10,100
4) Purchases Account
Date Debit Credit Balance
July 2 Bank GH¢1,000 GH¢1,000
July 8 Cash GH¢5,000 GH¢6,000
5) Furniture & Fittings Account
Date Debit Credit Balance
July 3 Accounts Payable GH¢5,000 GH¢5,000
6) Accounts Payable
Date Debit Credit Balance
July 3 Furniture & Fittings GH¢5,000 GH¢5,000
7) Motor Van
Date Debit Credit Balance
July 5 Bank GH¢4,000 GH¢4,000
8) Stationery
Date Debit Credit Balance
July 8 Cash GH¢150 GH¢150
9) Insurance
Date Debit Credit Balance
July 17 Cash GH¢100 GH¢100
10) Drawings
Date Debit Credit Balance
July 22 Bank GH¢1,000 GH¢1,000
11) Motor Expenses
Date Debit Credit Balance
July 25 Cash GH¢300 GH¢300
12) Sales Account
Date Debit Credit Balance
July 18 Cash GH¢2,500 GH¢2,500
July 28 Bank GH¢5,400 GH¢7,900
b) Trial Balance as at July 28, 2019:
Debit Credit GH¢ GH¢
Capital 16,000
Cash 2,250
Bank 10,100
Purchases 6,000
Fittings 5,000
Accounts Payable 5,000
Motor Van 4,000
Stationery 150
Insurance 100
Drawings 1,000
Motor Expenses 300
Sales 7,900
Total $28,900 $28,900
Explanation:
a) Ledger Accounts are the financial records of all classes of business transactions, which record the debit and credit sides and extracts balances for preparing the trial balance.
b) Trial Balance is a list of the balances extracted from the ledger. It is a tool for checking if the two sides of the accounts are in balance (equal). It is the basis for adjusting entries and the preparation of the financial statements for a period.
