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24 Cards in this Set
- Front
- Back
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What 4 things is a journal used for? |
write off bad debts enter opening balances in a new set of ledgers record payroll transactions correct errors |
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when a journal entry is made in the journal book of a digital accounting system, using the relevant nominal ledger codes, is anything automatically updated? |
yes. the affected nominal ledger balances |
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when a digital accounting system is used, are certain processes automated? |
yes. assuming its coded correctly. |
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in a digital accounting system, will a journal entry that doesnt balance be processed? |
no. |
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what is a journal entry? |
a written instruction to the bookkeeper to enter the transaction in the ledger |
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what does a journal entry include? |
the journal number date authorised by account of supplier or customer ledger account names debit and credit amounts |
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Is a journal used to create accounting records for a new business? |
yes. |
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When using journals to open a new business, what steps do you take? |
create a journal and post balances as credits and debits, and the amounts. next, post the journal entries to to a new nominal ledger |
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when entering a new business's assets, liabilities and capital into a journal, what is credit and what is debit? |
assets are debits, liabilities and capital are credit |
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What are the entries in the accounting system that are made in respect of salaries and wages known as? |
Payroll transactions |
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What is gross pay? |
the total amount that the employer owes the employee before any deductions have been made |
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what are statatory deductions? |
deducations taken from an employees pay because the law requires it |
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what statatory deductions are there? |
income tax and employees national insurance contributions (NIC) |
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When recording gross pay, which accounts are debited and credited? |
Debit wages expense, credit wages control |
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When recording net pay, which accounts are debited and credited? |
debit waged control, credit bank |
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when recording income tax and employees NIC to HMRC, which accounts are debited and credited? |
debit wages control, credit HMRC |
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when entering emplotees pension contributions, which accounts are debited and credited? |
debit wages control, credit pension |
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when recording employers NIC, which accounts are debited and credited? |
debit wages expense, credit wages control |
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when employees NIC is transferred to the HMRC account, which accounts are debited and credited? |
debit wages control, credit HMRC |
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when recording employers pension contributions, which accounts are debited and credited? |
debit wages expense, credit wages control |
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when transferring employers pension contributions to the pensions account, which accounts are debited and credited? |
debit wages control, credit pension |
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when accounting for payroll you should ________ the wages expense with the total cost |
debit |
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when accounting for payroll you should _________ the wages control account with the liability |
credit |
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the last step when accounting for payroll is to? |
reallocate amounts owed from the wages control account to the relevant liability accounts and transfer the net pay to the individual (bank) |
