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My Dear Tutor, I have a question relating to Pedantic and Paradigm with strata
1st example
Pedantic with sophistic
Trial balance 30 September 20×8
Current assets(16000+6600-200-400)
Cash in transit-200Trade payable(8200+4700-400)
Note 4.Sophistic’s trade receivables at 30 September 20×8 include $600000 due from Pedantic which did not agree with Pedantic’s corresponding trade payable.This was due to cash in transit 0f $200000 from Pedantic to Sophistic.
Here is Sophistic
debit cash in transit-200
credit trade receivable -200pedantic-Debit trade payable-400
sophistic-Credit trade receivable -4002nd example
paradigm with strata
Trial balance at 31 MArch 20×3
TR(14800+9000-900-2800)
Bank(5100+900 Cash in transit)
TP(17600+13000-2800)Note 3.Stata’s current account balance with paradigm at 31 march 20×3 was $2.8 million which did not agree with Paradigm’s equivalent receivable due to a payment of $900000 made by strata on 28 MArch 20×3 which was not received by paradigm untill 3 April 20×3
Paradigm
Debit cash in transit-900
credit-trade receivable-900strata Debit trade payable-2800
paradigm-credit trade receivable-2800If is has cash in transit why it has not been recorded 1900 like in the 1st example such as 400?
Also why in the first example 200 and 4oo deducted and added 200 as cash in transit but only 400 deducted from Trade payable but in the second example 900 and 2800 deducted from trade receivable and again 900 added as cash in transit but 2800 deducted from trade payable?
My question i did it like thatsuch as in the first example but it does not give me correct result because i
Debit cash-900
credit trade receivable-900
debit trade payable-1900
credit trade receivable-19002nd example
paradigm with strata
Trial balance at 31 MArch 20×3
TR(14800+9000-900-1900)
Bank(5100+900 Cash in transit)
TP(17600+13000-1900)its note same as each other and i do not know why it is not correct.
I understood first example cancelling process but i applied it for the second but it is not correct. need second example’s explanation?also maybe it has been recorded like that because the cash was not received by paradigm untill April 20×3 ?am i right?
Get two separate pieces of paper and head the first up as follows:
PARADIGM’S records
Strata Current Account Receivable
And then draw a BIG capital letter T on that page
Same for the second piece of paper but head this one up as:
STRATA’S records
Paradigm Current Account Payable
And draw a BIG capital letter T on this page
For this second question, put in the figures that you KNOW are correct:
According to Strata there is an amount payable to Paradigm of $2,800,000 so put that figure in the credit side of the Paradigm Current Account Payable in Strata’s records
And we know that that balance is after Strata has recorded the payment of $900,000 cash paid that has not yet been received by Paradigm
So accelerate that $900,000 into Paradigm’s records with the double entry:
Dr Cash $900,000
Cr Strata Current Account Receivable $900,000And now these two current accounts agree so carry down in this Strata Current Account Receivable the agreed balance of $2,800,000 from the credit side above the line to the debit side below the line
And now you can balance off the Strata Current Account Receivable to find out what the unadjusted balance WAS in the Paradigm records
You should be able to take it from there through to the end of the exercise
Ok?
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