Improve Your Business: Workbook (ILO, 1986, 96 p.) 3. BOOKKEEPING Part 1 - Questions Part 2 - Business practice Part 3 - Action programme How to construct your action programme Answer to business practice

Improve Your Business: Workbook (ILO, 1986, 96 p.)

3. BOOKKEEPING

Part 1 - Questions

		Yes	No
1. Do you have a bookkeeping system?
2. Do you understand the bookkeeping system yourself?
3. Do you check your bank statement with your cheque counterfoils and paying-in slips?
4. Can you get all the information you want quickly, and is it correct?
5. Do you file all vouchers (receipts, invoices, etc.) in such a way that they are easily found when needed?
6. Do you have a set of books that gives you information about:
	(a) How much your customers owe you?
	(b) How much you owe your suppliers?
	(c) Your employees, their wages and so on?
	(d) The present value of your machines and equipment?
7. Do you write out vouchers when people get cash from you and make them sign their names on the voucher?

Figure

Part 2 - Business practice

Use the sheet called “ Ledger”, below, to enter the following business transactions:

Transaction	Date	Item
1.	8 July	A carpenter sells a sofa and receives 600 NU cash from the customer.
2.	10 July	The carpenter receives a loan amounting to 8,000 NU from the local bank. The money is put into the carpenter's loan account.
3.	15 July	A turning lathe is bought. It costs 7,000 NU. It is paid with the money from the bank.
4.	15 July	Wages are paid to four employees. In total 400 NU is paid out.
5.	16 July	The carpenter sells four chairs and receives 600 NU cash.
6.	18 July	Raw material is bought: 60 m of timber 5 × 2.5 cm. The cost is 240 NU. It is paid in cash.
7.	19 July	Interest on the loan is paid. 100 NU is taken from the bank to pay the interest which is due.
8.	19 July	A water bill amounting to 300 NU is paid in cash.
9.	20 July	The customer who bought four chairs returns one, owing to bad quality. The customer receives 150 NU in return.
10.	22 July	The carpenter takes 500 NU from the bank and pays school fees for his son.

Transactions no. 1 and 4 are already entered in the ledger to show you how it is done. Now try to enter the rest of the transactions.

Now that you have completed the business practice exercises, turn to the pages which follow the action programme. There you will find the answers. Check your answers against the answer solutions which are given. How many correct answers did you get?

CHECK YOUR ANSWERS!

THEN GO TO THE HANDBOOK FOR MANAGEMENT IDEAS

Now go to the Handbook and read thoroughly the management ideas in the same section there. You will then find that all the business practice exercises become easier to answer.

Ledger

DATE

PARTICULARS

ID. NO.

CASH

BANK

SALES

RAW MAT.*

WAGES

LOANS

EQUIPMENT

INTEREST

DRAWINGS

OTHERS

July

In

Out

Bal.

In

Out

Bal.

In

Out

In

Out

In

Out

In

Out

In

Out

In

Out

In

Out

In

Out

8

One sofa

1

600

600

600

15

Wages

4

400

200

400

* RAW MAT. = raw materials

Part 3 - Action programme

How to construct your action programme

Count the number of times you answered “yes” or “no” for the set of questions. How many times did you answer “yes”? The more “yes” answers, the better you are in business management. Now look again at those questions you answered with “no”. Those are possible problem areas in your business. Choose the one which you think is the most important for your business. Take the most urgent problem first. Don't try to solve everything at once.

Now write the problem into the action programme opposite, as we have done with the example. Then write in What must be done, By whom and By when in order to solve your problem.

Finally, go back to your business and carry out the action programme.

Figure

Problem	What must be done?	By whom?	By when?
Example:
We do not have a proper bookkeeping system for the business.	1. Buy a suitable ledger and some notebooks and journals.	Myself	Friday 5/6/86
	2. Begin to enter details of all money in and money out of the business.	Myself	Next monday 8/6/86

Answer to business practice

DATE	PARTICULARS	ID. NO.	CASH			BANK			SALES		RAW MAT.		WAGES		LOANS		EQUIPMENT		INTEREST		DRAWINGS		OTHERS
			In	Out	Bal.	In	Out	Bal.	In	Out	In	Out	In	Out	In	Out	In	Out	In	Out	In	Out	In	Out
July
8	One sofa	1	600		600					600
10	Loan	2				8,000		8,000								8,000
15	Turning lathe	3					7,000	1,000									7,000
15	Wages	4		400	200								400
16	4 Chairs	5	600		800					600
18	Timber 5 × 2.5 cm 60m	6		240	560						240
19	Interest on loan	7					100	900											100
19	Water	8		300	260																		300
20	1 Chair returned	9		150	110				150
22	Private expenses	10					500	400													500

Figure