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4.9       What is meant by the ‘concept of duality’? Provide an illustration involving test bank a business transaction where the business purchases office furniture on credit.

The concept of duality means that every business transaction will have a dual effect on the accounting equation. The equation always stays balanced. For example the purchase of office furniture on credit will mean that the office furniture will be increased and the supplier (accounts payable) will be increased.

4.10     Both the journal and the ledger can be used to record a large number of transactions. Differentiate between financial recordkeeping in the journal and the ledger for test bank.

A journal is a book which records each business transaction shown on the source documents in chronological order. An entity may record their transactions in separate journals for transactions that occur frequently. For example: entities which deal mainly in cash will have a cash receipts journal and cash payments journal. An entity dealing with credit will also have a credit sales and credit purchases journal for test bnk is also available.

A ledger is an account that accumulates all the information about one item in the accounting reports, e.g. sales, cash. It is often prepared using the summarised information from the journals. For example: if you used special journals to record similar transactions such as cash receipts or cash payments then you would post the totals from these journals to the ledger accounts. There will be a separate ledger account for each item affected by the transactiontextbook solutions is available for

and each account will have a debit side and a credit side. The advantage of recording in the ledger is that it summarises all the transactions affecting one account e.g. Wages.

4.11     Discuss the purpose of a double-entry bookkeeping system.

A double-entry bookkeeping system accounts for a large number of transactions and involves the dual effect of the transaction being recorded as a debit entry and a credit entry. A debit entry will increase assets and decrease liabilities and equity and textbook solutions. For this reason, debits (which are often abbreviated to Dr) are entered on the left-hand side of a ledger account. The credit entry will increase liabilities and equity and decrease assets. For this reason, credits (which are often abbreviated to Cr) are entered on the right-hand side of a ledger account.

4.12     Summarise the procedures you would undertake if an accounting worksheet does not balance.

The initial step that you would take if the accounting worksheet does not balance would be to double-check every transaction entered and ensure that the duality rules have been applied. Then all the arithmetic should be rechecked. The bookkeeper should also check for transposition errors (where figures may have been transposed). For examples the owner withdraws cash of $ 2400 and this is entered as negative cash $2400 and negative equity as $4200 textbook solutions also available.

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