CASH BOOKS AND DOUBLE ENTRY

System · February 2006

Hi,

I was wondering if anyone could offer me some assistance! I'm confused about cash books (payments side) and double entry. If you have a mix of credit payments for invoices and also cash purchase payments which include VAT, what are the double entries in the main ledger? I know that for credit payments the entry is CR cash book and DR Creditors Control. I know that for cash purchases you CR cash book, DR Purchases (net of VAT) and DR VAT. However do cash purchases also have to touh the Creditors Control? Can anyone help??? Thanks!!

System · February 2006

Re:CASH BOOKS AND DOUBLE ENTRY

I don't understand the main ledger VAT bit either. My tutor explained double entry in T Accounts and journals really well but not the main ledger control a/cs. can someone help me too?

Thanks

Gem

System · February 2006

Re:CASH BOOKS AND DOUBLE ENTRY

Hi Cathy,

I believe for cash purchases you will just CR Cash book(Gross) and DR Purchases (net) DR Vat

But i could be wrong, but its how i would do it if i had to answer a question like that.

Sam xx

System · February 2006

Re:CASH BOOKS AND DOUBLE ENTRY

That help me a lot, thank you!

Gem

System · February 2006

Re:CASH BOOKS AND DOUBLE ENTRY

Hi

Re your query

if you are paying a creditor you would

CR CASHBOOK
DR PURCHASE LEDGER SUBSIDIARY A/C*

FOR CASH PAYMENTS WHICH INCLUDE VAT (YOU MUST HAVE THE VAT RECEIPT)

CR CASHBOOK
DR THE NOMINAL CODE TO WHICH YOU ARE ALLOCATING THAT PAYMENT TO
DR VAT

*POSTING TO THE SUBSIDIARY WOULD BE REFLECTED IN THE CREDITORS CONTROL SO THEY WILL BALANCE.

Hope this helps.

Violet

System · February 2006

Re:CASH BOOKS AND DOUBLE ENTRY

Thanks for your help. I think I've got it sussed now! Cheers.

CASH BOOKS AND DOUBLE ENTRY

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