Computerised Accounting

Chapter(1)

Getting Started and Set up Sole Trader Company

MYOB software allows businesses to keep track of what is happening to their business

from all aspects – debtors, creditors, sales, purchases, inventory, banking financial

and Management report.MYOB software is developed for the use of both accountants

and non-accountants.
Getting Start

Welcome to MYOB Premier Dialogue box appears.

The following options:

Open- Open an existing company file

Create- Create a company file for your business

Explore- Experiment with a sample company’s data and learn how to use

your MYOB software

What’s new- Learn about the new features in the version of MYOB software

Exit- close your MYOB software.

Creating a new Company Data file

Transaction: Create a new company data file for Crown Computer Company, a new

stationery company established by Mr. Thomas White

• Company Name – Crown Computer Company

• Address- 256 SKY Street

• Phone Number- 62234455

• Fax Number- 62234477

• E-mail Address [email protected]

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Enter the above transaction and click next button.

Enter the accounting year information about your accounting year and click next button.

Transaction

For Crown Computer Company ,its financial year starts in July and ends in June the
following calendar year .The company commences business on 1 July 2008.

1. Current Financial Year-12month time frame used to define your accounting

(2009)Year.

2. Last month of Financial Year- This is the month in which your financial year
end.(June)

3. Conversion Month-Select the month you want to start making day to day

entries. You must have the opening balances up to the beginning of this

month.(July)

4. Number of Accounting Period-Most Companies use only 12 accounting

Period.eg (Twelve)

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Please Confirm your accounting information . Next – Continue. Back to correct

the information.

You must select the accounting list(iii)to build your own account list and click next.
1. I would like to start with one of the lists provided by MYOB Premier.

2. I would like to import a list of accounts provided by my accountant after I’m

done creating my company file.

3. I would like to build my own accounts list once I begin using Premier.

• Save your company Click Change button to change the name and location of your
company file.

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• Click the next button. When the Set Up is competed you will see the congratulatory

message.

Exit from MYOB

Click file I Exit

Assignment!

Mr Benny started a sole trade company called Blue Sky Computer Accessories
Company January 2009. The company buys the stationery accessories from supplier,

and sells in the local market. The company adopts the standard 12 months financial

Period, commencing from January 2009.

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Chapter (2)

Setting the Accounts List , Modifying , Deleting and Printing the Account List
• Every account must be assigned a classification before it can be used to track

your company’s financial activity.

• There are eight different account classifications.

Account
Code Nature of Accounts Description
Type
Assets 1 Items of value owned by Cash, inventory, Motor, buildings,
the business. furniture, Account Receivable, Deposited
Funds
Liabilities 2 Obligation or debts due Loans, Accountable Payable, mortgage,
to other parties. sale tax , payroll tax, customer deposit,
import duty payable
Equity 3 The owner’s share in Owner/Shareholder’s Capital, owner
the business. /shareholder’s drawing , retained earnings,
current year earnings
Income 4 Money earned from Sales, services, freight collected, late fees
core business. collected
Cost of 5 Cost incurred with Purchase , Discount Given ,freight inward,
Sales producing Products /Services. raw materials, labour cost
Expenses 6 Cost incurred while Legal & professional fees, bank charges,
generating income office supplies, discount taken, freight
paid, late fees paid , office cleaning,
telephone , utilities, rent, motor
Other 8 Income that does not Interest income, Recovery of bad debts
Income form part of the core
business transactions
Other 9 Cost incurred other Interest expense, income tax expense
Expense than those daily
operating expense
Opening the Company File

• Launch the MYOB software

• When Welcome to MYOB Premier Dialogue Box appears , choose Open Your

Company File option box.

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• Choose your destination where the company files stores, choose the file and

click open.

Creating a Header Account

• At the MYOB Command center, choose Account icon, followed by Accounts List.

• When account list window display, decide what type of account you want to

create ( Asset, Liability, etc ) Eg Click Asset tab

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• At the account List Window New button to create additional accounts for your

company.

• When the Edit accounts window will be displayed, click Header account option.

Account Type Eg Asset

Account Number 4 digits Eg.0030

Account Name Eg. Office Equipment

Opening Balance $0.00

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• Click OK to the Account list Window

Creating a New Detail Account

• At the account list window , click the New button and choose the Detail account

type.

• Enter1-0031 as Account Number and Office Equipment as Account Name

(Detail Account) and click OK.

Modifying and Existing Account

• Click Auto feed ( ) arrow of account 1-0031 Account now.

• Change Account Name – office Equipment At cost and Click OK

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Deleting an Existing Account.

• Click Auto feed ( ) arrow of account-Eg 2.4000 Accruals

• Click Edit/ Delete Account

• Note-Can delete an account from the Account List if the account.

1.is not a prefixed header account eg 1.0000 Assets

2.has a zero balance

3.has no recurring transactions that is associate to it.

4.is not linked to any transaction type.

Printing Account List

• Click the drop -down arrow of Reports and select Accounts.

• Select Account list Summary as report name.

• Click customise button Under Advanced Fillers tab, Select Level.4 for Report Level.

• Under the finishing tab, ticks include Account Numbers.

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• Click Display button

• Click Print if you want to print.

Converted Report to different formats

• All the reports in MYOB can be converted to different formats,.

• Theses formats are Microsoft excel, E Mail, Fax, PDF, HTML, Tex files format.

• In Report view, click Send to button and then select the appropriate format
required.

• Change to directory and click save button to save with PDF format.

Account Opening Balance

Account Balance brought forward from previous year / month.

Record this Account Opening Balance

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• Open Company Data File

• Check the amount Account list Window (eg. Office Equipment at Cost)
• Click Set Up Menu> Balances> Account Opening Balances.

• Opening Balance Box appears.

• Enter the balance of your account as you type.

▪ Eg. 1-0035 Office Furniture at cost $2000

• Enter all Balance as positive number

• click OK

• Check the Account list window.(eg Office Furniture at cost)

• If you delete the opening balance amount.

• Set up> Balance > Account Opening Balance

• Click the amount you want to delete Press delete key.

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Chapter-3

Banking – Receive Money & Spend Money

Banking – Receive Money

The Banking Command Centre

Received Money
• To record receipt of money (Customer, capital, interest earned)
• Click received money to start record cash receipt.

Transaction

There is capital contribution of$50,000 on01/07/2008by the owner of the company

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Mr Thomas White to start Crown Company.

Payor (Click drop down button)

Window will be displayed. (List New button)

Card Type Employee

Designation Individual

Last Name White

First Name Mr Thomas

Click OK

Click Payor field again

Payor Mr Thomas White

Amount $ 50000

Payment Method Cheque

Memo Capital Contribution from

Mr Thomas White Record.

Exercise

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03/07/2008 Received another cheque for $50000 from Mr Thomas White for

additional capital construction, This cheque is banked into the 1-

1110 General Cheque Account .

31/7/2008 Received another cheque for $100 from bank for interest income.

This Cheque is banked into the 1-1110 General Cheque Account.

Banking Spend Money

Banking Command Centre

The spend Money feature is used to record office expenses and purchases of fixed asset.

Click Spend Money.

Transaction

To record a payment for the purchase of office equipment from the supplier, Fast

Computers Ltd. A cheque eg for $20000 was issued on 07/03/2008.

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Account- 1-1110 General Chequed

Card- New ( fast computer ltd )

Memo- Purchase of Office Equipment
Date- 03-07-08

Amount - $20,000/Click Record

Exercise
05/07/2008 Cash purchase for drinking water from the supplier ,Star Office Ltd.

A cheque (Ref#330101)for $120 was issued. harge this purchase to

6-3900 Misc Office Expense acct.

15/7/2008 $212.40 payment to Quick Telecom for telecommunication and

telephone expense,cheque#330102)

Checking Transcation use to Transation Journal

Banking Command Centre

Click - Transaction Journal

Click – Disbursements tab (or) Receipts tab.

Press Enter to check

(eg 1-7-2008- 31-7-2008)

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Bank Register

Banking Command Centre

Click- Bank Register

Enter 01-07-08 Date form and 31-07-08 in To.

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Chapter(4)

Petty Cash and Bank Reconciliation

Creating Petty Cash Account

Most business establish a petty cash account to detail with small amounts of cash

payments. Account list “ 1-2140Petty Cash Account (Bank Type)”

Transfer money Between accounts

Account command centre select Transfer Money.

Transfer Money From 1-1110 General Chegue Account

Transfer Money to 1-2140 Petty Cash

Account $ 1,000
Transfer Date 7/7/2008

Memo Money Transfer to Petty Cash Account

Click Record Button

Using the Petty Cash Account

Transaction
20/7/2008 Mrs Thomas White , makes a claim for Local Transport charges

incurred.$45.50 was issued to him in cash from the petty cash

account.

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Banking command centre Select Spend Money

Account 1-2140 Petty Cash Account

Cheque NO. 1

Date 20-7-2008

Amount $45.5

Acct # 6-3300 Local Transport

Record

Perform bank reconciliation

Banking Command Centre

Click Reconcile Accounts

Transaction

You received the bank statement on 3/8/2008 and the bank balance on 31/7/2008

shows $79,090.As of 31/7/2008, there is an unpresented cheque for star office Ltd

and Quick Telecom. There is also a monthly bank charge of $10.00 on 31/7/2008.
• Select account 1-1110 General Cheque Account.

• Enter the Bank Statement Date as 31/7/08 and New Statement Balance as

$79090 out of balance amount of $ 79,090 appears.

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• Tick next to the cheques that have been cleared. (Star Office Ltd and Quick Telecom.)

• Click Action button and choose Bank Entry.

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• Enter Amount as 10.00 bank charges as of 31/7/08

• Record button when done.

• If check the amount of out of Balance is $0.00 then click Reconcile button when

done.

Imprest System

Business will usually replenish the float at the end of the month or when the petty
cash float runs out, which ever is earlier.

01/08/2008 Mr Thomas White decides to increase the petty cash float by $500.

Determine the cash shortfall under the imprest system and the transer # TR 02 was

issued for this purpose.

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• Check the amount in the 1-2140 Petty Cash Account.

• At the Account command centre, select Transfer money.

• In the transfer money from field Click in Card and select the account form which

the funds will be paid. (eg1-1110 General Cheque Account)

• In the transfer money to field Click in card and select the account from which

the funds will be paid.(eg1-2140 petty cash account)

• Type Transfer # (TR02) Date (01/08/2008),Amount (545.50). Memo (Increase

the Petty Cash -Imprest(System)

• Choose Payee ( Cash), 1-2140 (Acct #),Name (Petty Cash) and Amount (545.50).

• Click Record
Exercise

Record the following August 2008 transaction for the ABC Stationery Company.

2-8-2008 The Company engaged No Problem Cleaning Company for monthly

office cleaning at $500 per month , The first payment is paid by cheque

#330105.Create a new expense account 6-3700 Office Cleaning to

record this.

6-8-2008 $150 was drawn our in cash from the Petty Cash account to pay for the

purchase of laser toner and printer ink.(Hint : Use “Cash” as the payee)

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16-8-2008 Mr Thomas White contributed additional capital of $5000, and this was

also deposited into the general cheque account.

22-8-2008 This month’s phone bill from Quick Telecom amounts to $245.67, paid

by cheque #330106.

25-8-2008 Mr-Thomas White use expenses for August Firstly,$75.65 for local

Transport secondly printing and stationery for $180 and finally 560 for
office equipment by cheque #330107

26-8-2008 The bill amounts to $150.89 for August. This was paid by cheque

#330108 to National Utilities Board.

29-8-2008 Paid $2400 by cheque#330109 for general office insurance.The policy

from Nation Wide Insurance will be effective from 1-9-2008 and this

payment is made in advance for 6 months; the monthly premium is

$400.(Hint :Record Spend Money and charge to a new 1-6000

Prepayments-Insurance account)
30-8-2008 Office Rent payment of $6050(cheque#330110)was paid to Frank

Watters Management Ltd.

31-8-2008 A refund was received from Quick Telecom for $50.22 for overcharging

in last month’s bill. The cheque was deposited into the general cheque
account.

Perform bank reconciliation for the Month of August 2008 and generate the Bank
Reconciliation report based on the information given as follows :As of 31-8-2008 ,
the balance as per bank statement is $81493.29.July2008’s unpresented cheques and
uncleared this month . The only unpresented cheques are #330109($2400)and
#330110($6050).There is only one uncleared deposit if$50.22 from Quick Telecom .
There is bank charge of 410.00 and $3.4 interest earned (credit to a new 8-1000)
interest earn account)for this month. Convert Bank Reconciliation report to PDF
format.

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Chapter(5)

Creating Card File New Customer , New Supplier and New inventory Item
Create a New Customer Card

• Start MYOB , and open the file Crown Computer Company.

• Click the Card File > Card List

• Card List Window will appear Profile Tab

• Click Customer tab, and then click the New button to create a new customer

card. Enter ADB Electric Ltd in Name and press tab

• Enter A 001 in Cards ID and press tab

• Select “ 27 Mountain road Unit 03-00” Go to Post code and type 278990
• Phone # 1 and type 65652230

• Enter 65652299 in fax info @ adb electric. Com in Email www adb. Electric. Com

in www(Website). Ms in Salutation and Veronica Wong in Contant.

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Selling Detail tab

Sale Layout - Item

Item Pricelevel - Base Selling Price

Income Account -4-1000 Incomes Retail

Credit Limit -$ 5000.

Payment in due -In a Given # Days

Balance Due Date -(30) days

Tax & Fruight Codes - the tax codes in the system NT Non Taxable Click OK

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Create New Supplier Card

Click Card List, Supplier Tab, New create new supplier card
Name – HD Manufacturing Company

Card ID – P 002

Adress – 101 Jaboree Street

Post code – 339012

Phone#1 – 63336000

Fax – 63337000

Email – info @ Pencil – mfg. com

WWW(Website) – www pencil- mfg. com

Salutation – Mr

Contact – Mohd Ahmad

Click Buying Details Tab

Purchase Layout – Item

Expenses Account _ 5.1000 Cost of Sale

Tax Code – NT Non Taxable

Freight Code – NT Non Taxable

Payment is Due – In a Given # day

Balance Due Days – 30

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Exercise

Create the following new cards in your card file.

Field Name Details Field Name Details

Card Type Customer Card Type Supplier
Name Jimmy Lake & Co Name Unit Accessories
Ltd
Card ID J003 Card ID P 004
Address1 :Bill To 1 Broad Way Address1 :Bill To 122Harvery Street
Postcode 445001 Postcode 556009
Phone#1 65533000 Phone#1 62341200
Fax 65534000 Fax 62341300
Saluation Mr Saluation Mr
Contanct Jimmy Lake Contanct Richard Somme
Sale Layout Item Purchase Layout Item
Item Price Level Base Selling Price Expense Account 5-1000 Purchases
Income Account 4-1000IncomeRetail Tax Code NT Non Taxable
Credit Limit $5000 Freight Code NT Non Taxable
Tax Code NT Non Taxable Payment in Due In a Given # of
days
Freight Code NT Non Taxable Balance in Due 30
Payment in Due In a Given # of days
Balance Due Days 14

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Creating a New Inventory Item

Inventory command centre click Item list

• Item Number – The unique Item number or code Eg, HDS

• Name – Short description of the item (Up to 30 characters) Eg.

Hard Disk

• I Buy this Item √

• I Sell this Item √
• I Inventory this item √
• Cost of Sales Account – usually the purchases account . This account will be

debited When you make purchases for this item (eg 5-1000 purchase)

• Income Account _ 4-1000 Income – Retail

• Asset Account – 1-4000 Inventory

Click Buying Detail

Tax Code when Bought – NT ( Nan- Taxable)

Primary Supplier for Recorders-

Specify the main supplier (Eg. HD Manufacturing Company)

Supplier Item Number -HDS

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Click Selling Detail

Base Selling Price -$0.40

Tax Code When sold – NT Non- Taxable Click – OK

Generating Inventory Price Summory

• Inventory Command Centre . Click Report.

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• Click Price Summary under Princing.

• Click Display and Click send to button to convert PDF format.

Field Name Details Field Name Details

Item Number MOS Item Number KB
Name Mouse Name Keyboard
I Buy This Item √ I Buy This Item √
I Sell This Item √ I Sell This Item √
I Inventory This Item √ I Inventory This Item √
Cost of Sales Account 5-1000 Cost of Sales Account 5-1000
Income Account 4-1000 Income Account 4-1000
Asset Account 1-4000 Asset Account 1-4000
Base Selling Price $6.00 Base Selling Price $6.00
Tax Code When Sold NT Non Taxable Tax Code When Sold NT Non Taxable
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Chapter(6)

Creating Purchase Order, Supplier Bill and Pay Bill

Create Purchase Order

Start MYOB and open the file.

Transaction

06/07/2008 Create purchase order to Unit Accessories Ltd for the following

200 rims of Mouse ( Item # MOS )at $3.00 pert rim.

500 rims of keyboard (Item # KB ) at $ 5.00 per rim.

• Before purchase order creation, create inventory creation for Mouse and

Keyboard in inventory Command center.

• To create a new purchase order, go to the purchases Command Centre.

• Click Enter Purchase , A Blank from will be displayed.

• At the topo left corner of the form, select ORDER to create Purchase Order
document .

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• Click layout button to change the Item layout format. Choose Item option and

click OK.

• Select the Supplier Eg Unit Accessories Ltd

• Click the Auto feed arrow to change the terms for this order , if required.
• Enter the Purchase (Eg 00000001 )

• Enter the date Eg 07.06.2003

• Leave the supplier Inv # field blank

• Go to the order column , Enter the Quantity E.g. 200

• Enter Item Number Eg. MOS

• At Description Column Mouse

• Press tab and enter per unit price Eg 3.00 Press Tab

• Total Amount will be appeared in Total Column.

• Enter NT in Tax field.

• Go to next line by using Enter key. Enter 50 in Order column, KB in Item Number

column and $ 5.00 in prices column.

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• Click Record button to save information.

Converting Purchase Order to Supplier Bill

Transaction

10-07- 200 rims of the MOS (Item# Mouse) 50 rims of KB (Item Keyboard)

2008 had been received of above order. The supplier bill (Ref: P 0012) was
received at the same time.

• Upon receipt of purchase order, the supplier will arrange for the goods to be

delivered to your company as instructed.

• Upon receipt of supplier bill, to convert the purchase order into supplier bill
before making payments. (Debit to Purchase, Credit to Trade Creditors

accounts Payable )

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• Click Purchase Register from the Purchase Command Center.

• The purchase Register shows all the purchases related documents. Click Orders
tab and enter date that you have order. Eg 1/7/2008 to 31/7/2008

• Under the Ordered tab, choose the purchase order that you have created earlier

and click change to Bill button.

• At the top left corner, the order has already been converted into a Bill .

• Enter the Supplier Invoice # (Eg P00123) and Date that goods arrived as (Eg

10/7/2008 ).

• If you perform a Recap Transaction, Click Ctrl+R. You will see the following
accounting and click OK.
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• -Click Record when done.

• -Go to back to the purchase Register, click Open Bills tab. Purchase order from

orders tab has moved to Open Bills tab.

12-7-2008 Another purchase order was raised to Unit Accessories Ltd for
another 100 rims of the MOS ( Item # Mouse )at $3.00 each.

16-7-2008 This order had been partly fulfilled due to the shortage of stock

on the supplier’s end. Only 80 rims of the MOS ( Item # Mouse )

had been received. The supplier bill (Ref: PO 0127) was received
at the same time . The remaining 20 rims will remain as

outstanding until further notice. (Hint: 20 rims will enter

Backorder column )

Paying Supplier Bills

Transaction
31/07/2008 The Company paid amount $1000.00 for supplier b ills in chegue.

Record the necessary transactions.

• At the Purchase Command Centre Click Pay Bill

• Bank Pay Bill form appears. Select the Bank Account from which you want to pay
bills from Eg-1-1100 General Chegue Account

• Select Supplier by clicking the button. Eg Unit Accessioned Ltd . All the

Outstanding bill are displayed.

• Enter the 330115 in Chegue Number 31/7/2008 in date and $1000.00 in

Amount

• Go to the Amount Applied Column by using tab, the amount to pay the first bill.

Eg $ 850 Go to next line and 240 for the second bill respectively.

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• Note that there is a partial settle mint of the second bill.

• Check the out of balance blank.

• Click Record button.

• Go to the purchase Register under the date range of 1/7/2008 and 31/7/2008,

the first bill is now listed under the close Bills tab.

Exercise

20-7-2008 Another Purchase Order was raised to Unit Accessories Ltd for another
40 rims of the MOS ( Item # Mouse ) at $3 and 30 rims of KB (Item #
Keyboard ) at $ 5.00
20-7-2008 40 rims of the MOS ( Item # Mouse ), 30 rims of KB ( Item # Keyboard )
had been received of above order. The supplier bill was received at the
same time. The company paid the outstanding amount at that date.

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Chapter (7)

Creating Purchase Credit Notes and Reporting & Analgsis for Purchase
Transaction

20/7/2008 Create a credit Note from your supplier, Unit Accessories Ltd for the

return of 20 rims of Mouse ( Item # MOS ). Then from purchase

Register use Apply Purchase to offset this $60 against the

outstanding supplier bill and supplier inv # (CN 00025)

• Credit note is issued by the supplier as an adjustment to the purchases that

you have made previously.

• This can be because

o the original supplier bill contains errors

o additional discounts the supplier is offering to you.

o you are returning some items to the supplier

• Click Enter Purchase at the Purchases Command Centre.

• Select Bill and Choose Supplier Eg Unit Accessories Ltd.

• Enter Supplier Invoice # will be supplier’s credit note number. Eg CN 00025

• Enter Received figure should take on a negative value Eg. 20

• By using tab, go to Item Number column and choose Mouse ( Item # MOS )
• The Price and Total will be automatically displayed.

• Click Record.

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• Go to Purchase Register and click Returns and Debits tab. The supplier’s credit

note will then be found.

• Select the transcation and click Apply to Purchase button.

• Apply to Purchase – to Offset against outstanding bills

• Receive Refund – to obtain a refund from supplier.

• Change the Date. Eg 20/7/2008

• Using tab, go to Amount Applied column.

• Click Record button.

• To check that your payables outstanding balance is reduced accordingly go to

the Purchase command centre and click purchase Register.

• Look at the Open Bill tab, and see the outstanding amount being reduced

accordingly.

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Generating Payables Ageing Report

• To analyses the payment due to suppliers for purpose of cash management or

suppliers relationship management.

• At the Purchase command center, Click Report

• Highlight the payable under Reconciliation Detail.

• Click Customise Button.

• Enter Date that to reference all outstanding payables against for payables As of

field. Eg 31/7/2008.

• Click Display button and the following report will be shown.

• Click Close button.

Generating Purchases & Payables Journal Report.

• Click Purchase & Payable Journal Report under Transaction Journals

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• Click Customise button to change date Eg 1/7/2008 to 31/7/2008.

• Click Display Button.

To Analyse Payables

The analyse payables window enables you to view detailed information about how
much you owe suppliers and how long you have owed them. This andysis is based on

all purchases and payments recorded in your company file.

• Go to the Purchases command centre and click Amalysis down arrow.

• Click follters. The Ageing Date window appears.

• see your filters in the Ageing Date window and click OK.

• Select the required view of the Analyse Payables window.

• The summary view displays all the money that you owe suppliers. Totaled by

suppliers.

• The supplier detail view displays all the money that you owe the suppliers
selected in the Supplier Detail field.

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• The purchase Detail view displays all the transaction assigned to the purchase

selected in the Purchase Click OK.

Exercise

10-7-2008 A purchase order was issued to HD Manufacturing Company for 1,00

pieces of Hard Disk ( Item # HDS ) at $10 each. Create this PO.
13-7-2008 The goods arrived and the Supplier Bill was received . Convert the

PO to supplier bill on this date.

14-7-2008 Upon inspection, it was found that 15 pieces of Hard Disk ( Item #

HDS ) was damaged during transportation, and the supplier has

agreed to accept the return of the defective products. Record this as

a goods return to supplier on that date by recording the necessary

transactions.

31-7-2008 The Company paid the outstanding amount. Record this payment.

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Chapter (8)

Creating Invoice Cash Sale

Creating Invoice

• Start MYOB and open the file

• To create a new invoice, go to the Sales Command Centre. Click Enter Sales

Transaction

17/7/2008 Create a sales invoice to customer ADB Electric Ltd on that date with

the following items and prices.

• 50 rims of Mouse (Item # Mos ) at $ 6.00 each

• 15 rims of keyboard (Item # KB )at $ 8.00 each

• 20 pieces of Hard Disk ( Item # HDS ) at $ 10.00 each .

• There is a transport charges of $ 20 to be billed in this invoice.

• 14 days credit term is offered on this invoice.

Hint : Create an item called “ Transport “ , Set the “Link this item to income account
4.2100 freight Collected.

• When a Sales window will appear, select INVOICE at the upper left comer of the

screen.

• Select Customer from your card file.

• Enter the invoice # , otherwise MYOB will automatically generate the running

number . Eg 00000001

• Enter the Date of invoice .Eg 17/7/2008

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• Enter 50 in ship Column and Press tab

• Enter MOS in item number column.

• At the Description column , enter the details of the items reguired by the

customer.

• Tax as NT ( Non Taxable ) and Press Enter

• Add another item step by step.

• Add the following information and click OK.

• Enter Transport in Item Number column and Name column.

• Tick I Sell this item, link 4.2100 (Freight Collected ).

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• Add the following information when sales dialague appears.

• Choose Transport in Item Number and Description column , 20.00 in Price

column.

• Click Auto feed button near Terms and Enter 14 in Balance Due Days box,

• If you want to see accounting entry, do an Recap Transcation (Ctrl+R) and Click

OK button.

Receiving Payments from Customers

• At the Sales command centre, click Receive Payments.

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• Following Blank Receive payments from appear.

• Select the Bank Account from which you want to receive money into Eg.1110
• Select the customer by clicking the down arrow button. Eg ADB Electric Ltd

• Enter the date and amount of the chegue by using tab 31/7/2008 and 640.

• Enter payment method Eg Chegue

• By using tab, go to Amount Applied Column.

• Click Record button.

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• In Sale Register under the date range of 1/7/2008 and 31/7/2008. See the

invoice is now listed under the closed invoices tab.

Recording Cash Sales

Transaction

25/07/08 create an Invoice for a new customer, Jason’s Eatery for 100 rims

of Mouse (Item# MOS) at $ 6.00 , 5% discount is also offered.

Because this customer is new , $ 200 payment is required upon

delivery the balance amount shall be paid with in 14 days. Create

this invoice and record the partial payment on that date

• .Go to Enter Sales.

• Choose Invoice from upper left corner.

• Using tab, to display select from list dialog box.

• Click New button to create new customer . Eg Jason’s Eatery.

• Enter the Invoice Date Eg 25/7/2008

• Enter 100 in ship column , Mouse in Item Number column , 6.00 in Price column

and 5% in Discount column by using tab.

• Click Autofeed button near Terms to change aging period. Choose in a Given #

of Days in Payment is Due box and 14 in Balance Due Days.

• Click OK buttons

• The term will be charged to Net 14.

• In paid today box the appear collected and press tab. Eg 200
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• And click Record button.

Exercise

5-7-2008 An invoice was issued to James Dobson for 10 pies of Mouse ( Item
# MOS ) at $6.00.

12-7-2008 An invoice was issued to City Town Club for 20 pies of Mouse (

Item # MOS ) at $6.00.

18-7-2008 An invoice was issued to Renaissance Resort for 20 pieces of Hard

Disk ( item # HDS ) at $ 10.00 each, and 50 rims of Mouse ( Item #

MOS ) at $6.00. The customer agreed to pay $100 deposit. The

balance will be paid within 14 days.

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Chapter (9)

Creating Sales Credit Notes and Printing invoice & Analysis for sale.
Creating Credit Notes

A credit note is usually issued as an adjustment to the invoices that you have

previously created.

Eg Credit notes are required goods returned from customers and discounts given.
Transaction

28/7/2008 Create a Credit Note for Jason’s Ealtery for the return of 10 rims

of Mouse ( Item# MOS )at $ 6.00 less the 5% discount.

• Click Enter Sales at the Sales Command Center.

• Select Invoice And choose Customer. Eg Jason’s Eatery

• Enter 10 as ship figure ( i.e a minus sign on the quamtity )

• Choose PPRA 4 in Item Number column enter Price as 6.00 and press tab.
• Enter 5% in Discount column.

• Click Record button

• Go to Sales Register, click the Returns & Credits tab and all credit notes issued
will be listed here.

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• Select the transcation. Click the Apply to sale button to offset against

outstanding invoices.

• Using tab go to Amount Applied column and appear amount will be $ 57.
• Click Record

• Go to Sales Command center, select Sales Register and click Open Invoice tab,

see the outstanding amount being reduced accordingly.

Creating Receivables Ageing Report

• Reports / Sales / Reconciliation Detail under Receivables from the under to

reports screen.

• Click customise and enter the date that you want to reference. Eg 31/7/2008

• Click Close button.

Generating Sales & Receivables Journal report.

• Click Reports / Sales / Transcation Journals / Sales & Receivables Journal

• Click Customize and enter the date range for the report.

• Eg. 1/7/2008 to 31/7/2008

• Click Display The flowing report will be displayed.

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To Analyse your receivables

• In the Sales Command Centre, Click the Analysis down arrow:

• Select Receivables from the Analysis list. The Analyse Receivable Window
appears.

• Click filters and choose the time periods and any other criteria you want to view.

• Click OK

• The information you selected appears in the Analyse Receivables window.

Exercise

19-7-2008 The delivery was made and upon inspection by the customer

Renaissance Resort , it was found that 20 pieces of item Hard Disk

( Item # HDS ) was defective. It was also agreed that the defective

item will be returned and a credit note will be issued accordingly.

31-7-2008 The Company paid the outstanding amount. Record this payment.

25-7-2008 An Invoice was issued to World Stationery for 50 pieces Mouse (

Item # MOS ) and 20 pieces Keyboard ( Item # KB ).

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26-7-2008 The delivery was made on that date, and upon inspection by the

customer, it was found that 10 pieces of item Mouse ( Item # MOS

) and 8 pieces of item Keyboard ( Item # KB ) was defective. It was

also agreed that the defective item will be returned and a credit

note will be issued.

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Chapter (10 )

Inventory Adjustment Stock Counts and Change Item Price

Understanding Inventory Management in MYOB

• Start MYOB and open the company data file.

• Go to the inventory Command Centre and click Item Register.

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• Enter the item number ( Eg Mouse ) and the date range . (Eg 1/7/2008 to

31/7/2008
• Click Close button

Making Inventory Adjustments

• Business may find that the actual stock quantities differ from what is kept on

the books or system.

• Such variations can be caused by a few factors data entry or human errors in

recording, defects or spoilage theft and obsolescence.

• From the inventory command centre

• Click Adjust Inventory.

Transaction

31/7/2008 There is a return of 20 units of Hard Disk ( Item # HDS ) from the

customer because these are found to be defective and no longer

saleable. Record an adjustment for this item.

• Enter date and memo description. Eg 31/7/2008 and Item defects.

• Select Item Number that you want to make the adjustment to Eg HDS .

• Enter the quantity to be adjusted Eg – 20

• Note – A positive figure will mean addition to the total quantity and conversely
, a cegative figure will mean deduction.

• Enter Unit Cost . It will be automatically Calculated and Shown.

• Enter the Account number to charge the adjustment to Eg 6-4000 Inventory

Shrinkage & Spoilage

• Click Record button

Updating Physical Stock Counts.

• From the inventory command centre, click Count Inventory

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• The complete item list with the system quantity will be shown.

• Enter the counted quantities under the column Counted Eg 20 for item Mouse

• Any differences will be shown on the Difference Column.

• Click Adjust Inventory to proceed.

• Choose 6- 4000 Inventory Shrinkage & Spoilage .

• Click Continue.And the Adjust Inventory Journal entry screen will be displayed.

• Click CTRL+R to see the related journal entry.

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• Click Record when done.

Exercise
On 31/7/2008 a physical stock count was conducted , and the quantities of the

following items were noted:

• Hard Disk(HDS) 25units

• Mouse 20units
• Keyboard 50 units

Record the results of this count as inventory adjustments.

Changing Item Price

• Click Set Item Prices from Inventory command centre.

• Enter the new prices of the items under the Current Price Column.

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• If there are a certain criteria to the item price change . Click Shortcut button to

enter the criteria.

• Type 50% in percent margin.

• Click Update All Items to update the new price to all items listed or Update X

Item Only to have preselected certain items to be updated.

• Click OK.
Generating Inventory Report

• Report/ Inventory/ Item list Summary

• this report display the entire item list, with the corresponding quantity on hand,

total value, average cost and current price.

• Click OK

Inventory Value Reconciliation

• Report/ Inventory /Items /Inventory Value Reconciliation . To generate the

inventory account balance agrees with the inventory value maintained by the

system.

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Chapter ( 11 )

Period End Adjustments Depreciation & Disposal of Asset

Period End Adjustment Entries

• At the end of a financial period , there might be some expenses ( as well as

income ) that may have been incurred but has not been paid, and certain

advanced payments being made.

• It is important to make period – end adjustments relating to the financial year.

Transaction

Signed up for an insurance policy with AHA insure on 1/7/08 . An advance payment

of 2400 was made for insurance premiums for the next 12 months . The policy will
take effect from 1/7/08 onwards.

• Open Company File

• Go to Account Command Center and choose Account list

• Check an asset account called 1- 2400 Prepayments – Insurance.

• Go to spend money of the Banking command centre to record payment.

• Choose 1- 1110 General Chegue Account in Account .

• Choose AHA Insure in Card.

• Type 1/7/08 Date 2400 in Amount, “ Advance payment for insurance policy “
in Memo

• Choose 1- 2400 Prepayments – Insurance

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• Click OK

Recording Adjustment

• If the prepayment is made for 12 months the following entry has to be made

every month for the next 12 months.

• Go to Accounts command centre , Select Record Journal Entry

• Type 31/7/08 in Date “ insurance in Account # column and type 200 in Debit

column.

• Press Enter to go next line

• Choose 1- 2400 Prepayments Insurances in Acct # Column and type 200 in

credit column.

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Saving Recurring Payment

• Go to Transaction Journal of the Account command Centre

• Choose General tab and type Date range E.g 31/7/08

• Click Auto Feed arrow beside transcation entry Eg 31/7/08 Insurance expense

for July 2008.

• Click Save as Recurring Function

• Choose Monthly in Frequency .

• Choose Alerts in Remind to record this transction in on its due date .

• Click Starting on type reminding date 31/7/08

• Click Save button.

Using Recurring templates

Transaction insurance expense for August by using recurring template.

• Go to Record Journal Entry of the Account Command Centre.

• Click Use Recurring button

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• Select a Recurring Transaction Eg Insurance Expense for July 2008.

• Click OK

• Type 31-8-08 in Date and “Insurance expense for Aug 2008” in Memo.

• Click Record button.

Accruals
Accruals expenses are the opposite of prepayments.

Trans: Accrue the rental expenses $ 5000 as of 31 July 2008 , and record the payment

made on 7 August 2008 to the Land Lord , Juniper Land.

• To record accrued expenses

• Click Record Journal from, the Accounts Command Centre.

• Type 31/7/08 in Date, “ To accrue for office rent for July 2008 “ in Memo .

• Choose 6- 4400 Insurance in Acct # column and type 5000 in debit column.

• Press Enter to go next Line .

• Choose 2 – 3000 Accrued Expenses in Credit Acct # column and type 5000 in
Credit column.

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• Click Record.

Recording Adjustment

• When the supplier Bill is received on the following month, you will record this

as a payment and charge this against the accruals account.

• Click spend money from Banking command centre.

• Entre Card : Juniper Land , Date 7/8/08 Amt $ 5,000 and type memo. “Office

Rental Payment for July 2008.

• Choose Acct # column enter 2- 3000 Accrued Expenses for $ 5000.

• Click Record.

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Methods of Calcutation for Depreciation

• Most of the fixed assets ( except Land ) have a limited life .

• It deteriorates in condition and depreciations in value due to climate condition

or lapse of time . So we charged depreciation for asset as an expense .

Depreciation Account Dr

Accumulated Depreciation Account Cr

( 1 ) Straight Line Method

𝐶𝑜𝑠𝑡−𝑠𝑐𝑟𝑎𝑝 𝑣𝑎𝑙𝑢𝑒 ( 𝑜𝑟 ) 𝑟𝑒𝑠𝑖𝑑𝑢𝑎𝑙 𝑣𝑎𝑙𝑢𝑒

Depreciation =
𝐿𝑖𝑓𝑒
Example. The office equipment is purchase in July 2003 and has a value of $ 19800 .

Assuming a Straight line depreciation method over 3 year.

Solution
Depreciation = 19800 / 3 = 6600

Depreciation for one month = 6600 / 12 = 550

( 2 ) Reducing balance Method

Depreciation = ( Cost – Acc Depreciation )*Depreciation Rate

Example

The office equipment is purchased in July 2003, and has a value of 10000.

Depreciation rate is 10%.

Solution
Year 1 Depreciation = ( 10000-0 )*10%=1000

Year 2 Depreciation = ( 10000-1000 )*10%=900

Year 3 Depreciation = ( 10000-1900 )810%=810

Recording Depreciation Using Journal

You may use Record Journal Entry Frature form Accounts command crntre to record

a General Journal Entry.

Assets Cost Depreciation Dep’n rateper Dep’n for 1 Dep’n for 2

Price Method annum month month

Furniture 10000 Straight line 20% 166.66 166.66

Motor Vehicle 10000 Reducing Balance 20% 166.66 163.89

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Journal For Depreciation

• Account Command> Record Journal Entry

• Enter Date and Memo , choose account and Click Record.

General Journal – GJ00002

Date _ 31/7/08
Memo _ Depreciation for July

6- 1300 Depreciation $166.66

1-1420 Furniture & Fitting Acc Depr $166.66

Depreciation for the month of August will be record using Straight line method for
furnace & fixture and Reducing method for Motor Vehicles.

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Disposal of Assets

Disposal of fixed assets is a sale of an asset which may generate profit or loss. Which
is the difference between sales price and net book value of the asset at the time of

disposal.

Tries cost and depreciation provision for fixed asset is shown in your respective

accounts code dated 30 June 2008. Both assets are sold at the price lised below.

Asset Cost Total Dep: Prow Selling Price

Furniture 10000 333.32 9900.00

Motor Vehicle 10000 330.55 8500.00

18400

• Create accounts in Other Income 8- 1500

• Gain Loss in disposal of Asset
• You received a cheque from Top & Co

• Go to Banking Command Centre. Click Receive Money.

• Select Payor Top & Co, Amount Received $ 18400.00 and Date: 30/8/2008

• Type memo Disposal of Asset and Choose Acct#

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Chapter ( 12 )

Report and Restoring backup file

Trial Balance

It shows the total debits or credits for each amount at a specified date.

• To generate a Trial Balance report , Click Report at the bottom of the screen.

• Click Accounts

• The index to Reports window will be shown.

• Choose Trial Balance . Click Customise and select the months you require.

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• Click Display button to see the Trial Balance statement on your screen.

Standard Balance Sheet

• Choose Standard Balance Sheet under Balance Sheet.

• Click customize button to choose the date required Eg 31/7/2008

• Choose Report level and financial Year.

• Click Display button

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Profit and loss ( Accrual )

• Choose Income Statement ( Accrual ) under income stalement.

• Click customize button to choose the date required .

• Eg 1/7/2008 to 31/7/2008

• click Display to view.

Performing Data file Backups

• Backing is the process of creating a copy of your business records that can be

used in the event that the company data file be becomes damaged or when the
computer crashes.

• Click file / Backup / MYOB / Premier Company file Backup.

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• Select Backup all data Or Select Back up Company file if you wish to back up
your company file only.

• Click Continue.

• MYOB will automatically assign a backup file ( ZIP ) name based on the data of

your backup, eg PRM 0617.21 P for backup done on 17 June 200x.

• Click save to create the backup.

Restoring a Backup file

• Choose file / Restore.

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• Choose NO button.

• Go to the Backup folder. When you’ve found the backup, select the backup.

• Click Open
• Select the location where the backed up company file will be restored.

• Click Save button

• An alert message appears, click OK to decompress the backup.

• when the restore process is done, Premier will appear and the company file
you’ve just restored will be open automatically.

To analyse your profit & loss

• From any command centre, click the Analysis down arrow and choose Profit and

loss from the menu . The Analyse Profit & loss window appears.

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• Click Filters and Choose the time periods and other criteria you want to view.

• Click OK. The information about the graph features. See using graphs.

To analyse your Balance Sheet

• Go to the Accounts command centre and click Analysis. The Analyse Balance

Sheet window appears.

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• Click filters and choose the time periods and other criteria you want to view.

• click OK. The information you selected appears in the Analyse Balance Sheet

window.

Exercise
• Generate the following financial reports for the month of July 2008.

(a)Trial Balance

(b)Standard Balance Sheet

(c)Profit & Loss Statement

• Save these in PDF Formats.

• Perform a backup of the data file.

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Chapter(13)

Setting Up Categories A Jobs

• You must set up the various categories and Jobs in the system before you can

allocable the income and expenses.

• Go to Setup menu and choose Preferences

• Click System Tab

• Tick the checkbox Turn on Category Trashing : Categories and Required on All

Transactions (System_wide)

Create the various categories

Translation : Open file. The business would Like to track its various sources of income
Retia I Division , Commercial Division, Admin Department.

• Go to Lists menu and select Categories, Click New and enter I D and Name.

• Type RTL in Category Name box.

• Click OK to save this new category is appeared.

• When you finish you should see the following categories List Window.
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Create Jobs in MYOB

• Go to Lists menu and select Jobs. The Jobs List window appears.

• Select Detail Job option so that you can assign transactions to this Job.
• Enter 100 as job number or job code Enter Can tract No, 100 in job name Click

Ok.

• When you finish , you should see the following job List window.

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Assigning Categories and jobs to Transaction.

For Bank transaction : on 23 July 2008, the company printed brochures for two jobs.
The company paid $ 5,000 to Highlands Printing Co. Record this total expenses to

jobs 100 and 200 on a split of 60% and 40% respectively. Assign this transaction to

the ‘’COM ‘’category.

Go to the banking command Centre and click Spend Money

Choose Bank Account Eg 1_1110 Chegue Ac

Enter the details Like Card , Date, Amount, Memo description. Erg Highland’s Printing

co, 23/7/08 5000, ‘’ Voucher Printing’’.

• Go to Account Column. Choose 6-4300 Printing.

• 3000 in Amount

• Choose Job. Eg 100

• Choose Account, Amount Erg 6-4300 Printing, 2000 and choose Job 200.

• Choose COM in Category box.

• Click Record button.

For sale or purchase Transaction

Transaction. On 20 July 2008 the company made a purchase forms its supplier ,
Extreme Machine Manufacturing Co. The supplier delivered on the same day 120 units

of Treadmill 100 (Item # TM 100)at $500each, and 60 units of Bicycle Exercise

Machine (Item # BlkE ) at $360each. These items should be allocated to job number
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‘’100’’ and the ‘’RTL ‘’ category. Create this supplier bill on 20 April 2008 with credit

terms of 30 days.
• Go to the purchase command centre and click Enter Purchase.

• Enter the details like Supplier name, date. Erg Extreme Machine Manufacturing

Co, 20/7/2008

• Click next to Terms

• In a Given # of Days in Payment is Due.

• Type 30 in Balance Due Days.

• Click layout and choose Item.

• Enter item quantity , item number and unit purchase price.

• Choose Job Erg 100

• Change NT tax in Tax

• Choose RTL in Category box.

• Click Record button.

Generating Reports with Categories and jobs

• Click Reports and choose Accounts.

(a) Job list Report

• Job list Report displays a list of jobs, sorted by job code. It provides with a

snapshot of the income, cost, expenses and net profit / loss for each job.
• Choose jobs > Jobs list

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• Click Display button.

(b) Jobs Activity Detai

• This report proudest a detailed breakdown of the transactions (debits and

credits) allocated to the job during a user. Defined period.

• choose jobs > Activity Detail.

• Click Customise button.

• Type Date Range : Erg Dated from To Jue.

• Click Display button.

(c) job Profit & Loss

• This is the mini P & L Statement ‘’for each of the jobs.

• To set the user – defined period.

• Click Display button.

(d) Categories List

• This report gene rates the List of categories used in the system.
• Click Display.

(e) Categories Activity Detail

• This report displays every transaction assigned to a category with in the given

date range and journals c for each selected accounts.

• Click Display

(f) Categories Profit & Loss

• This report shows the profit and loss on those transactions assigned to the

selected categories.

• Click Display.
Exercise

Continuing with the some data file, record the following transactions.

1. Create a new job code 300 , which is for ‘’ Contract No 300’’.

2. An invoice was is sued on 31 July 2008 to the new customers, True fitness
Company, for the sales of 7 units of TM 100 and 5units of BIKE at $900 and

$450 each respectively. Charge this transcation to job 100 and RTL category.

A credit term of 30 days was extended to the customer.

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3. The following are the expenses relating to the jobs on hand for the month of

July 2008. Use the Spend Money feature to record these transactions. Assign
all transaction to the ADM cater gory.
Date Payee Nature of Expense Job 100 Job 200 Job 300

28-7-08 QC Supply Office Supply 300 500 Nil

28-7-08 Mr Tan Store Supply Nil Nil 1000

31-7-08 Cash Wages & Salaries 5000 4000 2000

4. Generate the various Jobs and Categories reports.

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Chapter (14)

Entering Tax Codes and Customer & Suppliers Opening Balance

Entering Tax Code

• Go to list menu and choose Tax Codes

• You will need to add tax code by clicking New button.

• Enter tax code information, eg. Code, Description and link Account code and

then OK.

• For GST you will need to create 4 tax codes\

Code Description Tax Type Rate Link Account

GST Standard rate Goods & Services Tax 7% Tax Collected=GST Collected

Tax Paid=GST Paid

ZR Zero rate Goods & Services Tax 0% Tax Collected=GST Collected

Tax Paid=GST Paid

EP Exempt Goods & Services Tax 0% Tax Collected=GST Collected

Tax Paid=GST Paid

OS Outside the scope Goods & Services Tax 0% Tax Collected=GST Collected

Tax Paid=GST Paid

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Customer & Suppliers Opening Balance

• We will be provided a list of Customers who have outstanding balance brought

forward form the previous accounting period.

• Open FIT Exercise Machines Ltd.myo

• Go to Setup, Balance and select Accounts Opening Balance.

Customer Name Invoice # Invoice date Customer P.O Amount

High Tech Showroom 0056 6/4/08 HS1258 250.00

Reliance Leisure 0071 10/4/08 RL250 750.00

King Advertising Limited 0088 15/4/08 KAL652 1000.00

Total 2000.00

Supplier Name Supplier Inv Date PO# Amount

MAX Marketing MM1150 10/4/08 1230 300.00

Life Equipment Supplier LES5510 15/4/08 1253 1000.00

Highland Printing Co HPC4455 18/4/08 1259 200.00

Total 1500.00

• To record Debtors $2000.00, Trade Creditor $1500.00 and Retained Earning

$500.00 . This would show “Amount left to be allocated” should be zero.

Opening Balance for Customers

• Sales Easy Setup Assistant is helpful that you may use when you start using

MYOB.

• Go to Setup menu and choose Easy Setup Assistant.

• The Easy Setup Assistant window will appear with 4 selections.

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• Click Sales button.

• The Introduction window will appear. Click Next.

• The layout here refers to invoice layout. Mark the “Item” and click Next.

• For the default Income Account, select 4-1000 Sales account. Enter $50,000.00

as the credits limit. Click Next.

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• Choose GST ( Goods & Service Tax ) for both tax fields. Click Next.

• To setup payment information, enter the following . Click Next.

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• Account for Customer Receipts field, select 1-2110 – Cheque Account and for

the Account for Undeposited Funds, select 1-2160 – Undeposited Fund. Click
Next.

• Build your customer List, before entering you sales, you need to set up your

customer list ( or ) Click New to create a customer record.

• Click New to add customer information and click Next.

• To enter historical sales ( open receivables ), click Add Sales.

• The Historical Sale window will appear. Enter customer information and click

record.

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• Repeat step for the next 2 transaction. Click Next.

• Congratulation box appear and click close to Setup Assistant window.

Opening Balance for Suppliers

• Go to Setup menu and choose Easy Setup Assistant.

• The Easy Setup Assistant window will appear with 4 selections.

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• Click the Purchases button.

• The Introduction window will appear. Click Next.
• The layout here refers to the purchase layout, Mark the “Item” radio button and

click Next.

• For the default Expense Account, select 5-1000 Purchases. Enter $ 55,000.00

as the credit limit. Click Next.

• Choose GST ( Goods & Services Tax ) for both tax fields. Click Next.

• To setup payment information, enter the following :

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• Click Next.

• For the Account for Paying Bills field, select 1-2110 – Cheque Account. Click

Next.

• This is the supplier list widow. You will have a list of supplier name that you

have added earlier.

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• Click Next and to enter historical purchase ( open payables ), click the Add

Purchase button. The Historical Purchase window will appear. Record the

following bill.

• Your total Out of Balance amount should be $0.00.

• Click Next once you have finished and click Close to close the Purchases Easy
Setup Assistant window.

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Chapter (15)

Setting up and Transaction with Foreign Currencies

Dealing in Multiple Currencies

• Some businesses buy and sell goods or services in more than one currency.

• Dealing in multiple currencies, the businesses will be affected by the changes

or fluctuations in exchange rates.

• A realized gain or loss on exchange rates occurs when there is an actual

change in the value of the transaction when a different exchange rate is used.

• An unrealized gain or loss on exchange rates is often used to describe the

situation where there is a potential gain or loss on a foreign currency

transaction due to the changes in rates.

Switching on the Multiple Currency Option

• MYOB default assumes that your are only dealing in your home currency ( i.e.

single currency )

• Open the data file, FIT Exercise Machines Trading Ltd.myo

• Go to the Setup menu and Choose Preferences.

• Select the System tab.

• Tick the option I Deal in Multiple Currencies ( System- wide ) checkbox.

• Click OK to handle multiple currencies transactions in your data file now.

Setting up Foreign Currencies

• MYOB will create a list of commonly used currencies and exchange rates for

you.

• All the foreign currencies are set at the exchange rates relative to your home

currency.
• E.g. if your home or local currency is Singapore Dollars, then all the other

rates are specified in relation to the equivalent of 1 unit of each foreign

currency

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Transaction: The company transacts in the local currency – Singapore Dollars ( $ )

and Foreign currency – Philippines ( PHP ). Exchange Rates ( local currency to 1 unit
of PHP ) is 12.

• Go to List menu and choose Currencies.

• Currencies List box appears.

• Click New button to create a new currency . ( OR ) Auto feed arrow next to the
currency name to edit the currency information. E.g. Click New button.

• Type PHP in Currency code and type Philippines in Currency Name.

• Type 12 in Exchange Rate and type PHP in Currency Symbol.

To specify the asset account for tracking receivables in currency

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• You should create a foreign currency trade debtors account for each foreign

currency that you deal in . E.g. A Trade Debtors – USD account. Trade Debtors
– Local Currency account

• Click Receivable Accounts tab.

• Click drop down button in Asset Account for Tracking Receivables in this

currency.

• If Trade debtors – PHP account has not been created, click New button.
• Choose Detail Account and choose Account Receivable Account in Account

type.

• Type 1-2201 in Account Number, Trade Debtor – PHP in Account Name.

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• Click Details tab, and select PHP in currency.

• When Message appears, click OK button.

• MYOB will automatically create the foreign currency exchange account ( 1-

2202 Trade Debtors – PHP Exchange ) to keep track of foreign currency

exchange rates changes.

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• Click OK to go back to the Currency Information window again and choose

Account. E.g. 1-2201 Trade Debtors PHP.

To specify the liability account for tracking payables in currency

• Click Payable Account tab, Link 2-2201 Trade Creditors – PHP if 2-2201 has

not been created, click new to create.

• Click Details tab and choose PHP in Currency.

• If the Message appears, click OK.

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• Click OK to close Edit Accounts Window.

• Choose Account in Currency Information window . E.g. 2-2201 Trade

Creditors – PHP .

Click OK to close the currency information window.

Exercise
1.Open the file, FIT Exercise Machine Trading Ltd.myo . Update the United State

Dollars according to the rate of US $ 1.00 to S$1.5. Create the necessary trade

debtors ( Acct # 1-2203 ) and trade creditors ( Acct # 2-2203) accounts for this

currency and link them to the currency where applicable. Also create the foreign
currencies bank account of 1-2111 Bank USD and link them to this currency.
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Entering Transactions Involving Foreign Currencies

(a)Creating Card information

• In order to sell to or buy from a customer or supplier in foreign currencies,

the foreign currency that the customer or supplier deals in must be specified

in the Card Information window.

• MYOB does not allow you to specify more than one foreign currency for one
customer or supplier.

• If you have a situation where you can sell/ buy in more than one currency to

the same customer/ supplier, each entry for a particular currency.

• E.g. ABC Company – USD and ABC Company – AUD [ For US Dollars and
Australian Dolars ].

Transaction: On 1/9/08, record the supplier bill from US Sporting Goods Company

for the purchase of 50 STEP ( Step Machine ) at USD $ 800.00 each on 30 days credit
terms. The exchange rate on this date is 1.5 . Generate the Supplier Bill.

• Open FIT Exercise Machines Trading Ltd . myo.

• Choose Card File and choose Care List.

• Click New to create new card.

• Type Name, Cardld. E.g. US Sporting Goods Company, USC001

• Choose Currency . E.g USD

• Click OK.

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(b)Creating Inventory Information

• Choose inventory and choose Item List.

• Click New to create new inventory.

• Type Item Number, Item Name. E.g. STEP, Step Machine

• Tick Check box and choose account.

I Buy this Item : 5-1000Purchase

I Sell this Item : 4-1100 Sales

I Inventory this Item : 1-2300 Merchandise Inventory

• Click OK.

( c ) Entering Supplier Bill or Supplier invoice

• Go to Purchases Command Center and Choose Enter Purchase.

• Choose Bill and Supplier. E.g. US Sporting Goods Company

• Choose Item for Layout and type Date. E.g. 1/9/08

• Type 50 in Received column, choose STEP in Item Number column, and type

800 in Price column.

• Click next to Terms and type 30 in Balance Due Days.

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• Click Rate USD.

• Type 1.5 in Transaction Exchange Rate.

• Click OK.

• If you do a Recap Transaction at this point, you will see journal entry for this
transaction

(a)in the Local currency.

(b)In originating US $ currency

• Note: The rate used here is 1 USD=1.5 SGD

2-2203 Trade Creditors – USD account will show the foreign currency
amount, e.g. US$ 40000(1*40000)

2-2204 Trade Creditors- USD Exchange is used to keep the difference

between the USD and the local currency rates. S$20000 (0.5*40000)

• Click Record button.

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(d)Paying Supplier Bill

Transaction: On 30/9/08, assuming that when the supplier bill was settled in full,
the exchange rate has increased to 1.52

• In Purchase command center, choose Pay bills.

• Choose Account ( Cheque Account), Supplier ( US Sporting Goods Company).

• Clock Rate USD and Change rate to 1.52

• Go to Amount Applied column.

• You can see an exchange loss (realized loss) of $800.00

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• Recap Transaction ( Ctrl+ R) will show the journal entry tor this transaction in

the local currency.

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Your Turn: On 15/9/08, record the sales invoice to Advanced Importer Ltd for the

sales of 40 STEP at USD$2000.00 , a payment of US$60,000.00 was received on 30

September 2008. The rates on 15 and 30 September 2008 were 1.5 and 1.52

against the local currency respectively.

Generating Reports Involving Foreign Currencies

• Click Report and choose Account – Currency – Currencies List

• Currency List – displays all the various currencies and the respective rates

maintained in the system. Take note that whenever you change the rates, the

currency list will also be changed. No historical rates are kept in the system.

Receivable/ Payables Reconciliation Details

If you want to display the repout in local currency, click Customise button, and then

select local Currency or Originating Currency at the finishing tab.

• Currency Realized Gain/ Loss – Generate this report to list down the

transactions that contribute to the exchange gain/ loss.

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• Currency Unrealized Gain/ Loss – used to determine the extent for the
provision for exchange gain/ loss that should be made at the end of the

financial period for financial reporting purposes.

Exercise

Open the data file of FIT Exercise Machines Trading Ltd and record the following
transactions. Refer to the exchange rates table below this page.

1.Update the Currencies list with the USD and AUD rates as of 1 September 2008.

2.On 3 September 2008, the company purchased and received 1,000 units of Exercise

Mat ( Item # MAT ) at A$50 each from an Australian exporter, Aussie Traded Pty Ltd.
3.The company made two equal payments in AUD to Aussie Trade Ltd for the 3

September 2008 purchase on 5 September and 20 September 2008. Record these

payments accordingly.

4.On 13 September 2008, the company sold 500 units of MAT at $ 200.00 each in
the local currency to a new customer, National Cycling Association, on Net 30 days

credit terms. No payment was received as of 30 September 2008.

5.On 18 September 2008, the company sold 300 units of MAT at USD70.00 each to

an received on 29 September 2008.

6.Generate the following reports as of 30 September 2008.

• Receivables Reconciliation Detail Report

• Currency Unrealized Gain/ Loss Report.

Exchange Rates Tables ( expressed in terms of local currency to 1 unit of foreign

currency )

Date USD AUD

1 September 1.50 1.30

3 September 1.51 1.30

5 September 1.51 1.29

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13 September 1.51 1.29

15 September 1.50 1.30

18 September 1.53 1.28

20 September 1.52 1.30

29 September 1.50 1.33

30 September 1.52 1.33

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Chapter ( 16 )

Debtor Management
Setting Credit Terms for Customers

• Depending on the type of business and industry, the credit terms offered may

be different.

• Open file, FIT Exercise Machine Trading Ltd.

(a) Specifying the credit terms for each customer

Transaction: Create a new customer Blue Sea and setting the customer’s credit terms

is 14 days from the date of invoice, with 3% early payment discount ( if paid within 7

days ) and a 5% late payment charge ( if payment is received after 14 days )

• Click Card Files tab and Choose Card List.

• Click Customer tab and click New.

• Type Blue Sea in Name.

• Click Selling Details tab.

• Choose Payment is Due, Discount Days , Balance Due Day and %Discount for

Early payment . E.g. In a Given # of Days, 7 and 14.

( b) Setting credit terms during invoicing

• During invoicing , i.e. at the Enter Sales – New Sales window

• Click the Autofeed arrow next to terms. The credit terms window appears.

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Setting the same credit terms for all new customers

Transaction: Set the default credit terms for all customers to Net 30.

• Go to menu Setup> Preferences > Sales tab.

• Click Terms button, and the Credit Terms window will be displayed.

• Change the setting the default credit terms.

Presenting Ageing Data on Reports

• The ageing data displayed on an ageing report is relative to the credit terms

defined for the selected customers.

• Go to menu Setup> Preferences > Reports and Forms tab.

• Choose Use Daily Ageing Periods [ System wide ], you can select the overdue

periods in days.

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• Choose Use Monthly ageing Periods [ System wide ], to show months in either
Month Names or Month Numbers.

Recording the Factoring of Debtors

It may be necessary for business to extend credit terms to their customers: poor

management of receivable will directly impact the business cash flow position.

Transaction: FIT Exercise Machines Trading Ltd3 has decided to factor all of its debts

as of 30 June 2008 owing by its customer, Charlie’s Gym to The Factoring Company .
The factoring company agrees to pay 90% of the total debts outstanding in cash and

charge 10% as factoring charges.

• Open the data file FIT Exercise Machines Trading Ltd3 and click Account List

from the Accounts Command Centere.

• Click New to create a new account, 1-2150 Factoring Account . You Should set
this as a Detail Account and the Account Type is Band. Click OK.

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• To close off the debtor to be factored, go to the Sales command center. Click

Receive Payment.
• Select the Customer. E.g. Charlie’s Gym.

• Type Amount Received . E.g. 5200

• By using tab, go to Amount Applied column.

• Press Ctrl + R to do Recap Transaction.

• Click Record.

• Go to Sales Register, all the invoices from the Open Invoices status to the Closed

Invoices status.
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To record receipt of money from the factoring company

• Go to Banking command center, click Receive Money.

• Select the option Deposit to Account as the 1-2110 General Cheque Account.

• Choose Payor , Date, Amount Received , and Payment Method. E.g. The

Factoring Company, 30-6-2008, 4680 and Cheque method.

• Click Record button.

To Record finance charges

• Go to Banking command center and choose Spend Money.

• Choose Factoring Account and choose Card. The Factoring Company.

• Type 30-6-2008 in Date.

• Go to Acct # column and choose 6-1250 Factoring Charges.

• Go to Amount column and type 520.

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• Click Ctrl + R to do recap transaction. And click Record.

• You will see with a debit of $520 to 1-2150 Factoring Account will have a zero

balance.

Exercise

1.On 31 July 2008, the company decided to factor all the outstanding debts owing by
Great World Marketing to The Factoring Company to improve its cash flow position.

The Factoring Company would charge a 10% finance charge for handling this, and the

balance would be paid in two equal payments on 31 July 2008 and 7 August 2008.

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Chapter ( 17 )

Advanced Inventory Management

Dealing With Traded in Items

Some Business allow their customer to trade in an existing item in a sales

transaction. Open Co Ltd

Transaction : on 5/3/08 , the company sold Mr Tom Jones to sell its Bicycle Exercise
machine (Item # BIKE ) which is priced at $ 900 less a trade in of a used machine form

the customer , valued at $ 300.

• Check 1- 9999 Contra Cheque Account exists.

• Set up the following inventory item that was traded in .

• Type Item Number and Name . Used exercise machine .

• I Buy this item ( 5- 1000 ) Purchase,

• I sell this Item ( 4- 1000 ) sales and

• Inventory this Item ( 1- 2300 ) Merchandise Inventory .

• create another Inventory item that will be used to reduce the sale price of the

item being sold .Eg. Type Item Number and Name .Traded – in Item . I sell This

Item ( 1- 9999 ) contra account instead of usual income accounts .

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• From the Sales Command center , click Enter sales .

• Create the invoice using Item layout .

• Choose Customer . Mr Tom Jones. Date 5/3/08

• Type ship 1, Item Number BIKE Price 900.

• Press Enter to go to next Line .

• Type ship -1, Item Number Traded in Item , Price 300.

• Recap Transaction ( Ctrl + R )

• Click Record Button

• Go to the Purchase Command Centre ,Choose Enter Purchase to issue , Supplier

Bill to account for the trade – in item received.

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• Type 1 in Received Column and choose Used Exercise Machine in Item Number.

• Type 300 in Price . The value should be the price agreed between the company
and the owner .

• Recap Transaction ( Ctrl + R ) to see double entry.

• From the Purchases command centre, click Pay Bills which you will be making

the payment.

• Select 1-9999 Contra Cheque Account , choose Supplier Mr. Tom Jones
• Enter Date: 5/3/2008, Type amount 300.

• Go to Amount applied column . Type amount 300.

• Recap Transaction ( Ctrl + R ) to see transaction.

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• The summaries, the effects of recording a sale involving trade – in items are as

follows:
• The trade debtors account will be increased by the net change:

• The item list will be increased by the traded – in item:

• The 1-9999 Contra Cheque Account will be zero.

Finally, go to the Sales Command Centre > Receive Payments to record the payment

made by the customer on the net balance in the usual method.

Accounting for Stocks on Consignment

• When a seller physically transfers the stock to the buyer in a marketing

arrangement, but without transferring the title to the buyer, this type of

transaction can be classified as consignment , and the stocks are often called

consignment stocks.
• The seller ( i.e. the consignor ) retains the title to the goods until the buyer (

i.e. the consignee ) sells the consignment stocks.

• The sale of consignment stocks, invoicing between the consignor and

consignee, and the settlement of payment between the parties may differ from
business to business, and may well depend on the marketing arrangement or

sales agreement between the two parties.

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• In MYOB, it can be recorded from the consignor’s and consignee’s perspectives.

Recording Consignment stocks Consignor

Transaction : On 5/8/08, Let’s assume that our company. Ltd enters into a marketing

arrangement with its new customer, High Tech Showroom , to display the latest model

of Treadmill 100.This showroom unit shall be held on consignment until it is sold by

High Tech Showroom.

• Create a new asset detail account called 1- 2350 Consignment.

• Create a new item number C – TM 100 and Treadmill 100- Consignment in

Name.
• I Buy this Item, 5- 5100 COS Equipment

• I sell This Item 4- 5100 Income Equipment

• I inventory this item 1-2350 Consignment Stock .

• Go to Inventory Command Center and Click Build Item to transfer the required

number of units from the normal stock account the consignment stock account.
• Type Date 5/8/08 Memo . Goods on Consignment .

• Go to Item number Column to choose Item Treadmill 100

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• Type the number of units to be deducted ( i.e . negative ): -1

• The Unit Cost and Amount will be shown

• Go to the second line, enter the corresponding item number for consignment

stock CTM 100 Treadmill 100 Consignment.

• Enter the same unit : 1, Unit Cost : 500, Memo ( where you want to kept )

Consignment to High Tech Showroom

• Recap Transaction ( Ctrl + R ) to see double entry.

• Click Record

• Click Item Resistor to see the movement of the items as well.

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Recording when the consignee sells the item

Transaction: On 5/6/08 this item was subsequently sold, and High Tech Showroom

was invoiced for $ 900 for this item. Transaction accordingly. Payment to Net 30.

• Go to Sales command center, Click Enter Sales.

• Choose invoice and Customer : High Tech Showroom.
• Type Date 5/8/08 and go to Ship column. Click Record.

• Type Ship: 1, Item Number C- TM100 Price 900

• Click Record

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• 1- 2350 Consignment Stock account is now credited and the quantity on hand

is also updated accordingly.

Recording Consignment Stocks – Consignee

Transaction : On 15/8/08 the company is receiving a new stock on consignment, C-

ROW ( Rowing Exercise Machine ), from its supplier (consignor),Joe Equipment

Supplier Ltd ).
-Create a New account for consignee’s book : 1- 2350 Consignment Stock.

-Create the item to be held on consignment. Item Number: C-ROW.

-Item Name. Rowing Exercise Machine

I Buy This Item 5- 1000 Purchase

I sell This Item 4- 1000 Sales

I inventory This Item 1- 2350 Consignment Stock

• To record the consignment stock received from the consignor, go to the

Purchase command center.

• Click Enter Purchases to create a Supplier Bill using an item layout

• Choose Supplier and type Date :Joe Equipment Supplier Ltd 15/8/08

• Type 1 in Received Column, C-ROW in Item Number.

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• Enter 0 for the purchase price.

• Click Record button.

• If you sell the consignment stock items, create a sales invoice with item layout.

• Select Order and enter the quantity sold and amount accordingly.

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• When the consignor bills you for the item sold go to the Purchases command

center. Click Purchase Register and click the Closed Bills tab.

• `Purchase document is found at the closed bill tab as the purchase price is

zero.
• Select and update this document with the actual price of goods as per the
Supplier’s ( Consignor ) invoice . Click OK When done.

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• After Clicking OK, this supplier Bill no longer be classified as Closed . It is now

reclassified as an Open Bill .

• Go to Sales Command Center > Sale Register > Orders tab.

• Select the order that was created in step.

• Click the change to Invoice button to convert the order into invoice.

• Click Record to confirm.

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Chapter ( 18 )

Bad Debts, Contra Entries

Businesses will normally make a provision for bad debts in its accounts for bad debts

and this can be a general provision based on past trends.

Eg a company may provide for bad debts based on 5% of total outstanding debts at a

given time.
Recording General Provision for Bad Debts

Bad Debts Dr ( Expense )

Less Provision for Doubtful Debts Cr ( Asset )

Transaction
The partners decided to set a general provision for bad debts based on 10% of the

trade debtor’s balance as at 30 August 2008 in local currency. Record this entry

accordingly on 30 June 2008.

• Open Company File

• Create necessary accounts.

Account Number Account Type Account Name

1-2200 Detail Trade Debtors

1-2210 Detail Less Provision for Doubtful Debts

6-1150 Detail Bad Debts

• Go to the Accounts command center and click Record Journal Entry

• Type Date, Memo . Erg 30/8/08 Provision for Bad Debts

• Go to Acct # , choose Account Name and type amount in Debit column Erg- 6-

1150 Bad Debt 1897.00 (18970*10%)

• Press Enter to next line, choose Account Name and type amount in Credit

column. Eg 1- 2210 Less Provision for Doubtful Debts.

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Recording Specific Debts Written Off

• It may be necessary to write off any outstanding debts if they subsequently

turned out to be unrecoverable e.g when a debtor becomes insolvent.

• Determine the amount to be written off as bad debts. There are many ways of

checking this . eg you can look under the open invoices tab of the Sales Register

in the sales command center and select the debtor and the appropriate date
range.

• Select High Tech Showroom under the date range of 1/7/2008 to 30/6/2008

Tak note of the total amount to be written off: $ 900.

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• At the sale Command Center, click Enter Sales and select the customer High

Tech Showroom.

• Click the layout button to select a Miscellaneous layout for invoice.

• Enter a description to state a reason for the entry., “To write off bad debts”
• Go to amount column and type amount with a negative sign. Erg (-900)

• If you do a Recap Transaction Ctrl + R you will see the following

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• Click Record button.

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• Go to Returns & Credits tab . Highlight the Credit Note for the bad debts that

you have just created, click the Apply to sale button to apply the credit against
the invoice (s) that you want to offset against.

• Click Record button.

Handling Contra Entries

• In some situations, a customer can also be a supplier. E.g. a legal firm may
provide legal services to an office stationery supplies company, and this

stationery supplies company may in turn sell goods to the firm.

• Some business requires such customers to pay and settle each invoice

separately.

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• Other businesses will net off the outstanding balances and pay or receive

payments for the net amount owing or net amount receivable respectively. Such
transactions are often called contra entries.

• The two methods to handle contra entries in MYOB are described below. Both

methods basically employ the use of a dummy ( bank ) account, 1-9999 Contra

Cheque account.
• Transaction: Record a supplier bill from Star Stationery Company for office

stationery supplies on 1 July 2008 for $300 on Net 14 days credit terms. To do

this. Enter a new purchase for 1 July 2008, using a Service Layout, charging this

purchase to the 6-1500 Office Supplies expense account.

Net, record a Sales invoice on 14/7/2008 to Star Stationery Company for the sale of

1 unit of BIKE tor $900 on Net 14 days credit terms.

• Create a new asset account called 1-9999 Contra Cheque account(Bank Type )

• Go to Card file and click Card List.

• Click All Cards tab; take note Star Stationery Company is your customer who is

also a supplier.

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Method 1- The Cash Received Method

(a)Recording Purchase Command Center

• Star Stationery Company ( as a customer ) owes the company $900 and the

company also in turn owes Star Stationery Company ( as a Supplier ) $300.

Net amount owing by Star Stationery Company is $900 - $300= $600

• Go to Purchase command centre, and click Pay Bills.

• Select 1-9999 Contra Cheque Account.

• Choose Star Stationery Company in Supplier.

• Enter Date, amount and go to Amount Applied Column . E.g. 14/7/2008,300

• Press Ctrl + R to see the double entry.

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• Click OK and Record.

(b)Recording Sales Command Center

• Go to Sales command centre, and click Receive Payments.

• Select 1-9999 Contra Cheque Account.

• Choose Star Stationery Company in Customer.

• Enter Date, amount and go to Amount Applied Column. E.g. 14/7/2008, 300

• Press Ctrl + R to see the double entry.

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• Hence the net amount owing by the customer is reduced accordingly.

• Note: When using the Contra Cheque account to do this, it is important to

ensure that the balance is reduced to zero every time you complete recording

the transaction.
• Click Card File and choose Card List. You will see Net amount owing by Star

Stationery $600

Method 2 – The Credit Note Method

Using the sample data file, create an invoice to a new customer, Reliance Leisure, for

the sale of 2 units of BIKE at $900 each on 2 July 2008 on Net 30 days credit terms.

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At the same time create a purchase from Reliance Leisure for air tickets amounting to

a total of $10000 on 10 July 2008 and on Net 30 day’s credit term. Using a purchase
agreed to set off the debts owing to each other on 28 July 2008.

(a)Enter purchase command center

• Go to Purchase command centre, and click Pay Bills.

• Select 1-9999 Contra Cheque Account.

• Choose Reliance Leisure in Supplier.

• Enter Date, amount and go to Amount Applied Column. E.g. 28/7/2008, 1000.

(b)To reducing the contra balance to zero

• Go to Sales command centre, and click Enter Sale

• Create a new Invoice using the Miscellaneous.

• Choose Reliance Leisure in Customer.

• Enter Date. E.g. 28/7/2008

• Enter Description column . E.g. “ To set off money owing to customer”

• Go to Acc # column and choose 1-9999 Contra Cheque.

• When a warning message appears, click OK to continue.

• Type amount – 1000

• Press Ctrl + R to see the double entry.

• Click Record button. The Accounting effect of this transaction is that Contra

Account will be reducing the balance to zero.

(c)Enter the sale command center

• Click on the Sales Register in the Sales command center, and then select the

Returns & Credits tab.

• Click Apply to Sales button.

• Go to Amount Applied and type 1000.

• Apply the credit note against the invoice to be reduced. This will reduce the

original invoice by the amount.

Exercise
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For the questions below, use the sample company data file, FIT Exercise Machines

Trading Ltd to record the following transactions.

1.The company had a dispute with customer Reliance Leisure on balance payment of

$800 ( after deducting the contra purchase amount earlier ). The customer refused to

mark payment on this invoice, and the company decided to write – off thes amount

as bad debts on 31 July 2008.

2.On 18 July 2008, the company sold a unit of BIKE for $500 on 30 days credit to DLL

Worldwide Express, and at the same time, DLL also issued the company a bill for $220

for freight charges for the month. The bill is dated 21 July 2008 on net 7 days credit

terms. Both parties agreed to offset the amounts owing to each other and settle the
balance as a single payment on 31 July 2008. Determine the amount to be set off,

and record the net amount payable to or receivable from DLL accordingly using the

Cash Received Method. And record the final payment received from DLL accordingly.

3.On 19 July 2008, the company sold 3 units of TM100 for $900 each on net 14 days
credit terms, King Advertising Limited. King Advertising Limited had previously billed

the company, on net 30 days terms, $500 worth of advertisement on 5 July 2008.

Both accordingly. Determine the amount to be set off each other’s debts and any net

balance shall be paid or receivable from King Advertising Limited using the Credit
Note Method. Record the final payment accordingly on 31 July 2008.

4.Generate the Receivables Ageing Detail Report as of 31 August 2008. Record a

general provision for bad debts based 5% of this total amount.

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Chapter (19)

Closing & Starting a New Financial Year

Performing Year – End Tasks

• As you complete one financial year and begin another new one, you will use the

Start a New Year feature to update the profit and loss amounts for the year and

to prepare the company data file for the coming year.

• When start a New Year, financial information for the previous year is transferred

to history and the current year amounts are updated to show any transactions

you have already entered for the New Year.

Closing a Financial Year & Starting a New Year

Marking easier to compare company’s performance form one year to the next, you

should do following:

1. Generally you should be looking at some aspects. E.g Reviewing and

printing trial balance, Reconciling bank accounts, printing customer

statements, counting items in inventory, etc.

2. Print all the reports that you wish to keep that show previous year’s

transaction activity.

3. Make backup copies of your data file before proceeding to close the
financial year.

4. Starting a New Year.

• Open Company File Ltd

Transaction: Close the current financial year and start a new one. Remember to

perform a backup before closing the year.

• Choose Start a New Year From the File Menu and click Continue to proceed.

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• If you want to backup your file, click Backup

• Click Continue button. When dialogue box appears, choose path to save backup

file.

• Click Save button. When Start a New Financial Year dialogue reappears, click
continues button.

• MYOB remind you important information as following . Click Continue button.

• MYBO will then ask you to confirm the new financial year, and the last month
of the financial year. Click Continue.

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• Follow the instructions in the next few screens, clicking Continue to proceed.

• Click Continue button.

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• Check bank reconciled transaction and then Continue button.

• Click Start a New Financial Year button.

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+
• After you start a new financial year, Click Verify Company File Menu to check

your company data file for errors and ensures that you company file is in healthy

working condition.
• Click OK

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The Case

1.Mr. Juniper Lee started a sole proprietorship business, Kitchen Power Appliance
Ltd, on 1 April 2008 with an initial star up capital of $200,000. The business buys

household electrical appliances and sells them to retailers. The company adopts the

standard 13-months financial year commencing on 1 April 2008.

You are required to:

Setup the company data file according to the facts given. The company address is:

Block 125 Stiller Drive, Floor 3 Unit 12

Tel: 234 0099

Fax: 234 0077

2.Set up the Accounts list of Kitchen Power Appliance Ltd’s as what you see

following. You must set the Header, Detail and Detail Cheque Accounts accordingly.

Chart of Accounts ( Summary )

Account# Account Header/Detail

1-0000 Assets Header

1-0010 Fixed Assets Header

1-0020 Furniture & Fittings Header

1-0021 Furniture & Fittings at Cost Detail

1-0022 Furniture & Fittings Accum Dep Detail

1-0030 Motor Vehicles Header

1-0031 Motor Vehicles at Cost Detail

1-0032 Motor Vehicles Accum Dep Detail

1-1000 Current Assets Header

1-1100 Cash On Hand Header

1-1110 Cheque Account Detail

1-1120 Undeposited Funds Detail

1-1130 Petty Cash Detail

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1-2100 Trade Debtors Detail

1-4000 Inventory Detail

1-5000 Prepayments – Rent Detail

2-0000 Liabilities Header

2-0010 Current Liabilities Header

2-2000 Trade Creditors Detail

2-2210 A/P Accrual – Inventory Detail

2-3000 GST Liabilities Header

2-3100 GST Collected Detail

2-3200 GST Paid Detail

2-3300 Sales Tax Payable Detail

2-3400 Import Duty Payable Detail

2-4000 Accruals Detail

2-5000 Customer Deposits Detail

2-6000 Amount Due to Owner Detail

3-0000 Equity Header

3-1000 Owner/Shareholder’s Equty Header

3-2000 Owner/Sharehldr Capital Detail

3-3000 Owner/Sharehldr Drawings Detail

3-8000 Retained Earnings Detail

3-9000 Current Year Earnings Detail

3-9999 Historical Balancing Detail

4-0000 Income Header

4-1000 Sales Header

4-1100 Product Sales Detail

4-1200 Services Rendered Detail

4-1900 Discounts to Customers Detail

4-2100 Freight Collected Detail

4-2200 Late Fees Collected Detail

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5-0000 Cost Of Sales Header

5-1000 Purchases Header

5-1100 Product Purchases Detail

5-1900 Discounts from Suppliers Detail

5-2100 Discounts Given Detail

6-0000 Expenses Header

6-1000 Bank Charges Detail

6-2100 Discounts Taken Detail

6-2200 Freight Paid Detail

6-2300 Late Fees Paid Detail

6-3100 Telephone Detail

6-3200 Utilities Detail

6-3300 Transport Detail

6-3400 Rent Detail

6-3600 Printing & Stationery Detail

6-3900 Depreciation Detail

6-5100 Wages & Salaries Detail

6-5200 Employment Expenses Detail

6-5500 Legal & Professional Fees Detail

6-5700 Office Cleaning & Repairs Detail

6-5900 Administrative Charges Detail

6-6100 Motor Vehicle Insurance Detail

8-0000 Other Income Header

8-1000 Interest Income Detail

9-0000 Other Expenses Header

9-1000 Interest Expenses Detail

9-2000 Income Tax Expense Detail

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3.The following transactions are made in April 2008. Record these

transactions in MYOB according to the dates and details given below.

Transactions for the Month of April 2008.

Date Transaction

1 April Open business account with the bank and deposited $ 200,000 as

capital. Pay deposit and rent to MRC Plaza by cheque #780901 for $

21,000. This consists of 2 months deposit and 1 month rent for April.

2 April Paid by cheque #780902 to Vanguard Motors for $48,000 by Motor

Vehicle and $1000 by Motor Vehicle insurance.

2 April Paid invoice $ 12,000 by cheque #780903 to IDEA Furniture for

warehouse shelves and office furniture.

4 April A Purchase order ( 00200801 ) was raised to purchase the following

inventory items from main supplier, Elek Manufactuer Ltd, in 14 days

credit terms;
• 30 Units of Kettle ( Item number ( KET ) for $58 each.

• 20 Units of Blender ( Item number ( BLN ) for $60 each.

Generate this purchase order.

5 April All the goods ordered form Elek Manufacturing Ltd was received along
with the supplier bill for a total of $ 2940. 14 days credit terms were

stated on the bill.

6 April Issue sales invoice to Great Students Hostel for the following on 14

days credit term.

• 10 units of Kettle ( KET ) for $95.

• 2 units of Blender ( BLN ) for $120.

6 April Sold the following item to Topform Suppplies Co.

• 5 units of Kettle ( KET ) for $98

• 3 units of Blender ( BLN ) for $110.

• For overall discount for $80 for this invoice.

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Record the half of payment by cheque was received and banked on the

same day.
Generate this sales invoices

7 April Receive $30000 by cheque for loan from the owner.

16 April Paid $2800 by cheque #780904 to Kerry Thomas for Wages & Salaries.

17 April A Purchase order (00200802) was raised to Elek Manufacturing Ltd for

supply of the following.

• 45 units of Kettle (KET) for $40 each.

• 60 units of Hotplate (HOT) for $18 each.

Generate this purchase order.

20 April Only 30 units of Kettle and 40 units of Hotplate was received with a

Delivery order, invoice well be 14 days credits terms. Remaining units

as Bank order.

23 April Remaining 15 units of Kettle and 20 units of Hotplate was received

from Elek Manufacturing Ltd. Create the Supplier bill for 21 days credit

term.

24 April Issue sales invoices to Goodyear Electrical Centre for the following on

7 days credit term.

• 50 units of Kettle for $85 each.

• 50 units of Hotplate for $40 each.

Generate this sales invoice.

25 April Payment by cheque #780905 to purchases of paper & printer ink from

Mel’s Stationery for $850.

25 April Prepare cheque #780906 for $1950 to PKW Associates for professional

services rendered on business registration.

26 April Create the purchase order (00200803) was raised to purchase the

following inventory items from the supplier Newly Imports Ltd. 14 days

credit term.

20 units of Stove ( STV ) for$160 each.

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30 units of rice cooker ( RIC ) for $80 each.

Generate this purchase order.

27 April The goods that order on 26 April arrived and the supplier bill was
received. Convert PO to Billon this date.

28 April Upon inspection, it was found that 2 Rice Cooker was damaged during

transportation, and the supplier has agreed to accept the return of the

defective products. Record this a goods return to supplier on that date.

Create a credit note.

29 April Pay $2940 to Elek Manufacturing Ltd for Purchase order (00200801).

30 April Received cheque from Goodyear Electrical Centre to 24/4/08 invoice

amount $6250.

30 April Received telephone & internet bill from Fast Telecoms for April 2008,

and it is paid by cheque #780908 for $290.

Payment for April utilities bill was made by cheque to Public Utilities
Works # 780909 for $306.

Juniper Lee withdrew $6000 via cheque # 780910 as Personal use.

4.In addition to the transaction above, prepare a journal entry to record the

depreciation for April 2009, for the following asset categories.

• Furniture & Fitting $150.00

• Motor Vehicles $ 200.00

5.Preform bank reconciliation for the month of April 2008. The bank statement

shows a balance of $ 139,512.50 on 30 April 2008. As at 30 April 2008, there are 2

un- presented cheque and 1 outstanding cheque.

Cheque# -780908 for $290

Cheque# -780910 for $6000.

CR000004 -Good Year Electrical Centre for $6250.

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There is also a bank charge of $15 for the month, which has been directly credited

from bank account and received for bank interest $3.50 . Generate the bank
reconciliation report for 30 April 2008.

6.Generate the following financial reports.

(a)Profit & Loss statement for the month ending 30 April 2008.

(b)Balance Sheet as at 30 April 2008.

(c)The following reports from 1 to 30 April 2008.

• General Journal

• Sales & Receivables Journal

• Purchase & Payable Journal

• Item Register (Detail)

• Cash Receipts Journal

• Cash Disbursement Journals

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