Saira is a trader. The transactions below occurred in January 2023.
Jan 2 Rent received, $360, was paid straight into the bank account.
Jan 4 $343 was paid to Jai by telephone transfer after deducting 2% cash discount from the amount owed.
Jan 7 Cash of $33 was paid for motor expenses.
Jan 13 Cash sales of $395 were paid directly into the bank account.
Jan 17 $194 was paid to David by electronic transfer after deducting 3% cash discount from the amount owed.
Jan 20 A cheque for $388 was received from Ivan, settling a debt of $400 in full.
Jan 27 Cash of $150 was withdrawn from the bank for business use.
Jan 29 Wages of $124 were paid in cash.
(a)[13]
On the facing page, prepare Saira’s cash book. Balance the cash book and carry the balances down at 1 February 2023.
(b)[4]
Fill in the table by entering ‘increase’, ‘decrease’ or ‘no effect’ in every box to show the effect of recording the items listed, which appeared only on the bank statement. The first row has already been done for you as an example.
(c)[3]
State the reason each external user of the accounting statements would be interested in Saira’s business continuing indefinitely.
Worked solution & mark scheme
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