Typical Transaction 19
Example: New unit sale price 60,000
TT19 and TT20 are related. TT19 recognise the sale of licenses at the new unit price while TT20 recognise the payment for the sale in TT19.
Accounting procedure is as follows:
> First, in TT19 enter “New Price”: 60,000
> Second, click “Apply Change”
Accounting procedure is as follows:
> First, in TT19 enter “New Price”: 60,000
> Second, click “Apply Change”
The entries for this transaction in the Accounting System can be seen here, in the AccountingLab and in the Accounting System, Operation O46, Q2:
| Recognise Revenue from Sale of Licenses | Increase in Debtors (+) |
|---|---|
| Increase in Retained Earnings (+) |
> Enter new addition to Debtors and Prepayments: 120,000
> Double entry: Debit entry Debtors and Prepayments balance augments by 120,000
> Retained Earnings augments by 120,000
> Values in red show Balance Sheet values before and after changes
> Double entry: Debit entry Debtors and Prepayments balance augments by 120,000
> Retained Earnings augments by 120,000
> Values in red show Balance Sheet values before and after changes
Typical Transaction 20
Example: New unit sale price 60,000. Total value of sale 120,000
Accounting procedure is as follows:
> First, in TT19 enter “New Price”: 60,000
> Second, click “Apply Change” Second, click “Apply Change”. The screen of TT19 will appear
> Third, go to TT20 click in list of transactions on the left.
> Fourth, the screen of TT20 with the new balance sheet will appear with changes linked to TT19.
> First, in TT19 enter “New Price”: 60,000
> Second, click “Apply Change” Second, click “Apply Change”. The screen of TT19 will appear
> Third, go to TT20 click in list of transactions on the left.
> Fourth, the screen of TT20 with the new balance sheet will appear with changes linked to TT19.
The entries for this transaction in the Accounting System can be seen here, in the AccountingLab and in the Accounting System, Operation O50, Q2:
| Recognise Revenue from Sale of Licenses | Increase in Cash at Bank (+) |
|---|---|
| Decrease in Debtors (-) |
> Double entry: Credit entry Debtors and Prepayments balance decreases by 120,000
> Debit entry Cash at bank increases by 120,000
> Values in red show Balance Sheet values before and after changes
> Debit entry Cash at bank increases by 120,000
> Values in red show Balance Sheet values before and after changes
| Balance Sheet | |||
|---|---|---|---|
| Original | After Changes TT19 | After Changes TT20 | |
| Assets | |||
| Current Assets | 767,850 | 887,850 | 887,850 |
| Bank | 758,550 | 758,550 | 878,550 |
| Debtors and Prepayments | 9,300 | 129,300 | 9,300 |
| Other Current Assets (Stock) | 0 | 0 | 0 |
| Fixed Assets | 44,000 | 44,000 | 44,000 |
| TOTAL ASSETS | 811,850 | 931,850 | 931,850 |
| Liabilities | |||
| Current Liabilities | 44,300 | 44,300 | 44,300 |
| Creditors | 44,000 | 44,000 | 44,000 |
| Accruals | 300 | 300 | 300 |
| Long Term Liabilities | 0 | 0 | 0 |
| Long Term Loan | 0 | 0 | 0 |
| Equity | 767,550 | 887,550 | 887,550 |
| Shareholders’ Equity | 800,000 | 800,000 | 800,000 |
| Income Statement | -32,450 | 87,550 | 87,550 |
| TOTAL Liabilities + Equity + Retained Earnings | 811,850 | 931,850 | 931,850 |