AAT Level 2 - Bookkeeping Transactions (BTRN) - Part 1 - LSBF Live Revision 2018

AAT Level 2 – Bookkeeping Transactions (BTRN) – Part 1 – LSBF Live Revision 2018

hi everyone and welcome to LSPs TV a warm up to mrs. those of you for joining me today you can a they cry and they low in the common extraction oh no it's a very nice beeping yeah yeah it works food aah assessments produced by the eighties and ourselves and these assessments are related to make sure to be successful and succeed in their exams tasks very very slowly any weekly period as this will give you more confidence that you need to go away and can derive such questions yourself and allows you to your game and like introducing myself right my name is Rick Tyler I did and I wanted to choose an area at lsbf and I love city promotion accounting and this one book keep't in the transactions maybe so it's quite clear in the close my heart but question you know I'm going to do testing you on your skills but it also assesses students when their ability to kill count they made the OT amount you do to customers amounts due to sires so this is the first post at Lincoln which be dealing with that day so so this is tasks the my one and and it's a question based on sales invoices see females on scrap and it had a paper in the county later and then we can work through this topic together okay so assessing noise is being paired for good sir pride show me in her customer hello so you usually see if the examiner given you some information and it's if the examiner is giving you a cell invoice it's like although it could be that you have to check if the amounts shown themselves in resource and up correctly to what you would expect to receive now it's two tasks users don't do well in exams comments again that there are some weaknesses excuse of a space which we be a calculation of VAP and also dealing with promptly painless discounts so this is all one little task to clear any confusions that you are got so so we've got is this customer order JJ ABC limited limited number three Niner seven one and the customer has asked us to supply I don't win two units of product J bit360 each trade discount okay be careful ladies and gentlemen I've different raise discounts and you can watch our videos that we have created so you can earn the importance of relationship between you two and the exact accommodations that you need a game as many months as possible alright so any of the questions is for all marks am I able to to try and get four out of four because I need to ensure that easy bits I can get as many as possible challenging later my task is to like any many masters as I'm explaining these you I won't be in to do it as a sponsor I expect we could discuss these issues and we can we find out what they main weaknesses substitute as they face okay she's just a repeat of the question this is task number one we are going to be doing relationship amounts to be included in the invoice okay so we may need to not not actually just just little bit three pieces of it okay number one they met amount before discounts amount reach before the diskens this this is easily calculated I'm going to scroll back again so you can see my mouse the customer between two units and these are pioneer upstream past sixty so to find the net amount before this discount all you need you to do is take hundred between two minutes two times it by 360 nothing in the amount before calculating to the discount so let me write working yeah this is 120 units believe on Christ three pounds 60 to 100 which when you take times actually 60 if I grab your calculators or not there's really nice pink lime I've had from a very long time because I've had such a long time it's a one-off in bitsy pieces that will be the price before deducting any amount of discount so let me just nicely type that on here 432 there you go very nice very easy so make sure you answer the question don't do what you want to do make sure you do what the examiner wants you to do so we've got four marks and we've got four boxes as you can see on the screen and I need to I'm guessing probably you've got a mark for each requirement here in Part A so work through it carefully but quick enough so you're confident that you've got the full marks in this section right the second item is the net amount after discounts okay so the customer has been offered a 7.5% trade discount so what I need to take the amount before discount and then net off or take away 7.5% of that so if you guys know what would be the net amount after 7.5 percent can you please give me a value in the chat box below would you guys think so as we are calculating this we take 432 pounds every minus 7.5 percent of this so that's going to be 7.5 percent of four hundred and thirty-two pounds okay so make sure that if you're using your calculator you get the percentages correct as well instead of putting zero point seven you might accidentally do 7.5 when the actual amount should be set zero point zero seven five so and I'm sure that students are quite nervous in the exam but you need to show the examiner that you are brimming with confidence okay or you've got other functions here in this scientific calculator where you can just press seven point five and there is a percentage symbol you make sure that you understand the beauty of your calculator and how to work it because if you use a brand new calculator on the day of your exam it could mean that you're not familiar with the settings and you're gonna get frustrated and you waste much more time than anticipated so just try and be calm and collective and work through your calculator before they actually exam okay so anyways back to what I was saying 7.5% or four hundred and thirty two that's going to be 32 pounds and forty pence so 432 takeaway that discount gives me a net amount to be three ninety nine point six zero okay so let me just type my answer then three nine nine point six zero okay that is the net amount after deducting the discount now we are going to do the v80 amount well students find dealing with v80 quite tough because the weaker students will base v8 here on the amount before discount but as you would learn in your studies that the v80 is calculated after deducting the trade discount but before deducting the prompt payment discount so the amount after discount 3:9 9.60 must be multiplied by the tax rate now in your AAT assessments the tax rate that you should apply is twenty percent so let me grab my calculations first three nine nine point sixty many times it by 20 percent now the bits that I'm doing here are the calculations all the work ease you can be doing them from the scrap pieces of paper that you've got in front of you and you don't have to show the exam one of the workings because the assessment isn't a computer software form at all they want you to do is fill in the final answer and that's what you'll get your marks on the calculations the workings this should be done by yourself and this is just something that I have done to get you to understand that the calculations are like this or like that etc etc so 399 pounds 60 times 20% if I type that on the calculator I'm getting 79 pounds and 92 pence so let me just put that in there 79 pounds and 92 pence to finish it off the examiner wants the total amounts due from the customer well the customer is going to be paying me an amount after the discount plus they'll pay me the v80 or the sales tax amount so the total jus will simply be three nine nine one sixty plus the v80 amount of seventy nine dot ninety two so if we type that on the calculator three nine nine sixty plus seventy nine ninety two and it's in for seventy nine point five two four seven nine point five two there we go I'm typing it slowly just to make sure that I don't make any mistakes my task is to get the correct answer so I can gain as many marks as possible that's what I'm here to do to pass this assessment okay so ladies and gentlemen that is Part A of the exercise let's move on to Part B it says what will be the amount entered in the cells day book when the invoice in a has been prepared ah so you have to use your answer from Part A and enter the answers for Part B if your answers to Part A are wrong but you've entered the correct amounts in the relevant spaces then you can still get full marks in Part B okay so the sales day book record all the invoices that we have sent to credit customers and we'll have analysis columns the total amount you from the customer the v80 amount due and therefore the net amount so using the calculations from Part A the total amount due is 4/7 9.50 to the v80 amount is seventy nine point ninety two and the net amount is going to be 399 pounds sixty 399 pounds sixty and there you have it so here the examiner is testing you on your ability to understand that the total the customer will pay you will include the v80 but the net amount that will go to your sales accounts but the v80 will go to your sales tax control accounts because the amount that you've collected from the customer is due to HMRC or the tax authorities okay so there you have it guys pop be very nice very easy now allow us to move on to Part C of the exercise pottsy we're still carrying on with the customer Jay ABC it says a check for 1567 has been received from Jay ABC which they incorrectly okay so the examiner has mentioned this they have incorrectly stated that this is full settlement of the accounts at the 28th of February the customers account in the sales ledger is shown below so we know the customer paid us some money that this does not clear their accounts this is an incorrect amount that they have stated that will settle the account so when we look at the customers accounts in the subsidiary ledger or in the sales ledger or we've got the receivables ledger then we would see actually the amount due from the customer and if they've paid us 1567 we can then find out how much they are yet to pay us or how much they still owe us okay so we've got J a BC that's their customer accounts okay and Part C of the question you can see they're just their show which three okay show which three transactions are still outstanding by circling the relevant transactions below okay so we've got the individual customer accounts they've paid us some money but they haven't settled their account they still owe us some money so the examiner is asking which three transactions are outstanding by circling the relevant transactions so in the actual assessment software you'll be receiving boxes a tick and then these boxes can be antics if you're not happy with your final answer and I think once you click a box it to get shaded in a blue gray sort of term so that means that you have chosen this particular box but if you have changed your mind then you can unclick it and then you can start answering the question again so don't worry make sure before you sit the real exam you go on to the AAT website and you try their assessments there are two assessments that you can attempt and all of these will cover a range of things are all tested from the syllabus plus you've got the answers which is an excellent way to check if you've got it right or wrong need to make sure you're the confidence you are able to do such things in the real day anyways that's what we're discussing here which three transactions are still outstanding and therefore you need to circle the relevant transactions below if they've paid me 1567 I need to know how much they only is at the 28th of February so I will need to balance this customers individual account and if you remember how to balance accounts you are going to be very successful for any of the financial accounting papers especially at level two we've got here the calculation of the balance carried down okay how do you balance this account you will add down the debit column and the credit column choosing the higher total of the two so where ads on the credit column that's for 80 plus 86 9 plus 32 plus 110 that's given me 1491 but the 1349 plus 270 plus 1 to 0 8 plus 3 9 1 plus 3 4 20 that is 6 6 3 8 so clearly the debit side is higher than the credit side so I'm just going to place my totals here six six three eight six six three eight at the bottom of both columns now the difference between the credits total and the debits chote will give us the balance carried down so as at the 28th of February we have a balanced carry down of how much so you do 6 6 3 8 take away the totals from the credit side and that will give me 5 1 4 7 whoops five one four seven there you go five one four seven so as at the 28th of February the customer owes me 547 but the customer paid me 15 67 so clearly they owe me a little bit more money so how do I find out the amount the customer owes me or the amount that is outstanding as out the 20th of February okay well first of all let's just find out how much they owe me after the amount that they paid let's just start from there five one four seven is the amount that they only add up that's beneath the FIB then they paid me 1567 so if I do four five one four seven 10.15 67 I've got three five eight zero okay so the amount outstanding is three five eight zero so I need to knock out this customer individual account and find out how which three of these will add up to three five eight zero now I think I'll take a massive guest and I'll start choosing three four to zero because it's the 28th of February and it's likely that they haven't received a customer invoice yet and therefore they haven't paid us the amount June so let's just start by adding that three four to zero okay and then we can also assume that they haven't yet realized that we have sent or issue of them with a credit note so if we issue them with a credit note it means that they owe us 110 pounds less so I'm going to deduct that then a hundred and ten pounds less what's the net figure here three four two zero take 110 which means they are going to be still owing me three three one zero okay so I think that one there else do we have serve three three one zero how do I get from three three one zero two three five eight zero let's see three five eight zero take which three three one zero which gives me an outstanding figure of 270 okay so let me just explain this in a little bit more detail the customer still owes us 515 67 so the net amount they owe us is 35 80 and now I've put a dollar sign in there which is the wrong thing to do because we're working in pants there we go so the pounds about three three one zero okay if they haven't yet paid us for 3420 it means they still owe 34:20 and if they haven't acknowledged a receipt of this credit note it means well according to once they owe us a hundred ten pounds less which means the net amount at this point is three three one zero so according to our calculations they owe us that much but the three five eight zero is the amount outstanding after 1567 and the net figure that they owe us is 270 now looking at the customers individual accounts I can see that the only transaction that has the balance of 270 is invoice two one two two three so I'm assuming that there's probably a dispute with this invoice and they haven't yet paid us so if I add that now plus 270 I'm getting three five eight zero and they two gentlemen there you can see it so the three for twenty the hundred and ten and the two seventy all add up to the net amount three five eight zero so let me circle the correct answers invoice one two two three so that's one of the answers voice 1 2 H 1 that's the second answer and then quit it no 96 that's the third answer so I've just selected which three transactions are outstanding ok so there you have it guys that is a section C of this task let's move on to the final bits which is Part D of the question ok a quotation to supply goods for three thousand five hundred and fifty pounds plus V eighty has been sent to JDC limited offering a prompt payment discount of two percent for payment within 10 days Part D for two months what will be the amount J ABC pay if they purchase the goods and pay within ten days okay so the examiner here is testing the application of prompt payment discounts if the customer pays us some money they'll pay the net amount plus the v80 but minus any point payment discounts this is the knowledge that you've gained in your studies and now the examiners asking you to apply the knowledge so they can test you whether or not you've understood it so if the goods cost three five five zero I will add dat on to this okay so three five five zero at twenty percent of this that will give me three five five zero times twenty percent that will give me four two six zero four two six zero okay so that's the amount Jew including V 80 but the prompt payment discount is for two percent for payment with ten days and if the customer does pay within 10 days they'll pay us for six twenty four two six zero yeah four two two six zero take away a two percent discount so four two six zero take away two percent of that that gives me four one seven four point eight zero so four one seven four point eight zero and that is the amount that gay ABC will pay if they pay within ten days okay so let me just finalize the question before I talk about a weakness is that students would face here four one seven 4.80 there we go so I've completed the task and I've got full marks if the payment is paid within ten days then the amount that we've invoice would be different to the amount that they've paid so in the AAT studies what the student is expected to do is understand that the supplier will issue the customer with a credit note for the difference of the amount okay and if the customer does not pay within ten days than the amount that is due is simply four to six zero okay please remember here that's the v80 is adopted after trade discounts but not adjusted for prompt payment discounts from payment discounts are other known otherwise known as cash discount or early settlement discounts these are offered to customers as an incentive for them to pay the amount before the invoice date okay and the examiner did mention that the common errors were that they need to calculate or understand me a little bit more that the amount received will be the total amount and not the net amount okay and it's also advisable to students that the balancing of T accounts is absolutely necessary because this will allow you to identify how much is due from cost and find out any bits and pieces that are left over okay so ladies and gentlemen that will be the end of this assessment task allow me to emphasize what we've learned and recup the requirements for this okay so it's very important that you understand where your strengths and your weaknesses are if you believe that this is a question that you can get full marks on that I strongly advise that you do this question first there is no role that you must do each task in chronological order it's helpful if you go through each task within the first 10 minutes of the assessment and flagging the questions that you believe that you should do first because that's where you can get majority of the marks there will be other bits that can be challenging but you can come back to those later please make sure that you understand the difference between v80 and prompt payment discounts and filling in the most important books of prime entry examples would be the cash book sales day book and the purchases book thank you very much for joining me we wish you all the best with your studies here at LSBF TV take care guys

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