Any bookkeeper/Sage 50 experts here?

[mollymoo]

If I enter the batch invoice with the original net amount and discounted VAT amount what happens when i process the payment for said invoice when the customer does take up the discount? The amount he pays wont tally with the amount on the invoice since Sage doesn't "know" there is a discount.

You would pay through bank > supplier payments, and this should have a discount column, (can't remember if this is just customer payments), in which you would put what's left over after payment of the discounted amount, this should then credit the rest of the invoice off automatically. If not then you would post the amount paid and then manually credit the outstanding amount, reference adjust and description see inv ? settlement discount.

 

[Goose]

Could use a wee bit more advice please guys.

I have a task that reads "Cash Sales of £775.00 for art books were made during a promotion at a local college. The amount was banked in full and then Carla drew £200.00 as drawings using cheque numbered 112."

Should Cash Sales be processed via a Journal Entry or a Bank Receipts entry?
Similarly, should Drawings be posted via Journal Entry or Bank Payments entry?

Thanks again.

 

[Freakbro]

I would use Batch Invoice (or Sales Order Processing and update to the S/L) to raise the invoice on Cash Sales a/c then Customer Receipts (Bank Receipts)

I would just use Bank Payments for the Drawings chq transaction

I wouldn't use Journals for either.

 

[Goose]

Apologies but I have yet more questions. I'm getting increasingly aggrivated by how poorly we've been prepared for this assignment. I'm having to google certain sage functions since they're completely new to me.

I have the following task to complete;

For the loan itself I was under the impression that these were always Journal entries but the text says to process it as a receipt and I wanted to clarify whether or not this mean using the Bank Receipt tool rather than the Journal. If using the Journal would I be debiting the current account 10,000 and crediting the Loan account (n/c 2300) 10,000?

For the repayments I am assuming I need to use the recurring payments as shown below;

The Standing Order is for £325 per month as capital repayment but this figure does divide in to £10,000 evenly. 30 repayments would be £9,750 whereas 31 repayments would be £10,075 so I am unsure how to proceed in setting up the recurring payment.

Lastly, should I be setting up two separate recurring entries, one for the capital repayment and one for the interest or is combining them in to one payment sufficient?

If I set up two separate entries would i be right in thinking i'd be using different ledgers for each one?

For example, would I be using the Loan account (n/c 2300) for the £325 payment so that it eventually balances with the 10,000 in there from the loan itself?

Then a second entry for the £100 interest going to the Bank Interest Paid account (n/c 7900)?

I hope this all makes sense to you, because it doesn't to me

 

[Freakbro]

Apologies but I have yet more questions. I'm getting increasingly aggrivated by how poorly we've been prepared for this assignment. I'm having to google certain sage functions since they're completely new to me.

I have the following task to complete;

For the loan itself I was under the impression that these were always Journal entries but the text says to process it as a receipt and I wanted to clarify whether or not this mean using the Bank Receipt tool rather than the Journal. If using the Journal would I be debiting the current account 10,000 and crediting the Loan account (n/c 2300) 10,000?

Personally I would use the bank receipt function and post it to the loan a/c 2300 (this is exactly the same as doing it via a journal)

For the repayments I am assuming I need to use the recurring payments as shown below;

The Standing Order is for £325 per month as capital repayment but this figure does divide in to £10,000 evenly. 30 repayments would be £9,750 whereas 31 repayments would be £10,075 so I am unsure how to proceed in setting up the recurring payment.

Yea, that's a bit odd it doesn't balance out exactly. Usually in exam world they make everything nice and balanced

In the real world I would set up the recurring payment for 30 months and manually do the first or last one...don't know if that's correct for the assignment though.

Lastly, should I be setting up two separate recurring entries, one for the capital repayment and one for the interest or is combining them in to one payment sufficient?

I would do them as one transaction if possible

If I set up two separate entries would i be right in thinking i'd be using different ledgers for each one?

For example, would I be using the Loan account (n/c 2300) for the £325 payment so that it eventually balances with the 10,000 in there from the loan itself?

Then a second entry for the £100 interest going to the Bank Interest Paid account (n/c 7900)?

I hope this all makes sense to you, because it doesn't to me

There's more than 1 way to do things in accounts, and what you have said above is correct.

You could either post the full £425 to the loan account and journal out the £100 interest or do it in 1 transaction and post the £325 to loan and £100 to interest paid (as you said).

Don't fret, you do seem to be understanding it fine

 

[Goose]

Thanks very much for you reply dude.

The final part of the assignment is processing wages which I have just completed but after looking through all the different ledgers I think I may have simplified it too much.

All I did was process a Bank Payment for wages in the amount of £1700 to the Net Wages account (n/c 2220) and then Journal Entries to P.A.Y.E (n/c 2210) for £387.56, National Insurance (n/c 2211) for £154.76 and then Employer's N.I (7006) for £189.23.

The reason I now think I've done it wrong is that there are additional ledgers called 'Gross Wages' (n/c 7000) and 'Wages - Regular' (n/c 7004) which I feel like I should be doing something with. I phoned my tutor who rather unhelpfully said that people often make mistakes with the Wages section and that I should read the task carefully.

Well, i've done that but i cant for life of me figure out how it's all meant to piece together. Could anyone give me some pointers?

Cheers.

 

[mollymoo]

Debit employers nic (700?)£189.23 (ERSNIC)
Debit gross wages (7000) £542.32 (PAYE & EESNIC)

credit HMRC (2210) £731.55 (ERS + EES NIC & PAYE)
or in your case
credit PAYE (2210) £387.56 (PAYE)
credit National insurance (2211) 343.99 (ERS + EESNIC
However I would put NIC and PAYE into one nominal called HMRC as these will be paid together in one go.

 

[Freakbro]

Wages are easy to deal with, you do all the following in 1 Journal :-

Cr 2220 Net Wages - 1,700
Cr 2210 PAYE - 387.56
Cr 2211 NI - 343.99 **
Dr 7xxx Gross Wages - 2431.55

That's it.

Then when you post the bank payment for net wage of 1,700 to 2220 it cancels out the journal entry - thus showing it's paid. Same when you post the bank payment for HMRC, it cancels out what is showing.


** NI can be put in the separate nominal code, even separate lines for ER and EE if you want, or I just put it in with the tax in 2210 for ease. Accountants like the split when directors are involved as directors wages & NI are reported separately in audited accounts.

 

[mollymoo]

I'm not sure the question asked for the net wages to be posted as a journal, just show the BACS payment, or as usual I'm just getting confused. AAT questions were way better explained

 

[Goose]

Thanks guys.

The bit about BACS confused me as well. I dont know if that means its something other than a journal entry or Bank Payments.

Also, is gross wages the sum of all 4 figures or would Emplyers NIC not be included?


Does this look at all correct?

To perfectly honest I was guessing at which entries should be the debits and which ones should be the credits.

 

[Freakbro]

Thanks guys.

The bit about BACS confused me as well. I dont know if that means its something other than a journal entry or Bank Payments.

Also, is gross wages the sum of all 4 figures or would Emplyers NIC not be included?

In the real world I've always just had 1 expense code for wages which includes Er NI, but what you have done above is correct and probably right for the assignment

Does this look at all correct?

Spot on

To perfectly honest I was guessing at which entries should be the debits and which ones should be the credits.

If it's an expense then it will be a Debit, so therefore the other side is a Credit.

If it's posting to a Bank A/C code, then if it's receiving money it will be a Debit, if it's paying money it will be a Credit (then just the opposite for the other side of the double entry)

HTH

 

[Goose]

Thanks dude.

With what i've done previously with the journal would also need to do a Bank Payment for 1700 to the Net Wages account or is it unnecessary since the debits and credits were balanced in the journal entries?

With the way the assignment is worded it sounds as though Net Wages were paid and therefore the Bank Current Account ledger needs to credited £1700?

I've been struggling to figure out where the Bank Current Account fits in to all this since the Net Wages were paid 30/09 and the rest to be paid on 15/10.

 

[Freakbro]

Thanks dude.

With what i've done previously with the journal would also need to do a Bank Payment for 1700 to the Net Wages account or is it unnecessary since the debits and credits were balanced in the journal entries?

With the way the assignment is worded it sounds as though Net Wages were paid and therefore the Bank Current Account ledger needs to credited £1700?

It's very necessary. The journal balanced (as it always will) but all it does is post the wages as an expense in the profit & loss (7xxx codes) and put the other side on the balance sheet (22xx codes) as an outstanding liability.

It's when you actually make the payment (Cr bank Dr 22xx code) you post it to the 22xx code, that code should then be 0, and it shows you have cleared the liability.

The same happens later the next month when you pay the HMRC the Tax & NI.

 

[Freakbro]

I've been struggling to figure out where the Bank Current Account fits in to all this since the Net Wages were paid 30/09 and the rest to be paid on 15/10.

It's just a 2 step process.

You could post the wages directly to expense account, it's the same result in the end, but it doesn't work like that with wages because you want the expense in the right month, so if you only posted direct to the expense account when you made the payment, then the Tax & NI would be in the wrong month - as it's paid later. And you also want to show outstanding liabilities on the balance sheet for month end reports.

So you use the journal to post all the expenses in the right month and show liabilities and then follow it up when actually paying by posting the bank payment to clear the liability on the balance sheet.

Whereas when making a direct expense payment, say like bank charges, you would just post directly to the 7xxx code.

I hope that's clear...after all these years it's a lot easier just doing it than trying to explain it!

 

[Goose]

Thanks so much for your help mate, you've probably taught me more in a few posts than my training provider has in 3 months