Accounting assignment

CPP40307 Certificate IV in Property Services (Real Estate) © 2015 National Real Estate Learning Page 1

ASSESSMENT PLAN

ASSESSMENT TASKS CPP40307

C E R T I F I C A T E I V I N P R O P E R T Y S E R V I C E S ( R E A L E S T A T E )

R E C O R D S A N D F I N A N C E S I N R E A L E S T A T E B S B R K G 3 0 4 B M a i n t a i n b u s i n e s s r e c o r d s

B S B S M B 4 0 6 A M a n a g e s m a l l b u s i n e s s f i n a n c e s

C P P D S M 4 0 0 6 A E s t a b l i s h a n d m a n a g e a g e n c y t r u s t a c c o u n t s

ASSESSMENT TASK 5 Version 1.1 - Aug 2020

CPP40307 Certificate IV in Property Services (Real Estate) © 2015 National Real Estate Learning Page 33

ASSESSMENT TASK 5

Assessment Task 5: Project – Trust account management

What you need to do:

§ Complete the tasks below to manage Your Home Real Estate’s trust account.

What you will need:

§ spreadsheet (Project 1 Template.xlsx,)

What you need to submit:

§ Completed financial documents § Instructions:

You work at Your Home Real Estate Pty Ltd.

Part of your job is to manage the company’s trust account.

As part of this role you are required to complete the following tasks:

§ enter all the transactions in the appropriate journals from the source documents

§ write up the ledger

§ reconcile the accounts once a month.

You will need to record all appropriate details in the company’s Trust Account Cash Receipts, Cash Payment and Transfer journals and ledgers for their trust account. You will be required to use the information included below to complete the following tasks:

§ Fill out the receipts for incoming moneys for two months of accounts.

§ Reconcile the account at the end of each month.

§ Issue monthly statements for all rental property management accounts. You will include in the statements a fee for $5 for the statement fee. The commission fee for rentals is 7% of the rental each month.

You will be the one issuing the receipts and writing out the cheques. You will not sign the cheques. You have at your disposal access to the bank account to check the statement day to day and see if there are any electronic funds transfers into the account.

Note: You can either use the Excel spreadsheet provided or an accounting software system to complete this task. If you choose the spreadsheet, note that there are six tabs provided:

§ Receipt

§ Cheque Butts § Journals

§ Ledgers § Statements

§ Trial Balance & Reconciliation.

Please prepare all the journals and ledgers and reconcile from the following details:

Date Information

Starting date: 1/4/2013

Ted Johnson has listed his house with the agency to sell. The address is: 2 Second St Wodonga. He has agreed to an advertising campaign. The first payment for the advertising of $350.00 is received on 2/4/2013. You will start with Receipt no. 1206

John Jones of 10 Circuit St Wodonga, has 3 rental properties with the company. They are:

Version 1.1 - Aug 2020

CPP40307 Certificate IV in Property Services (Real Estate) © 2015 National Real Estate Learning Page 34

ASSESSMENT TASK 5

Date Information

65 Martin St ($1200 per month), 15 Drysdale Ave ($1350 per month), and 47 Robert St ($1500 per month).

James Smithson has a commercial property he rents through your company. It is located at 34 Drinkwater Pde. It is rented to BAC Commercial for $2000 per month.

3/4/2013 The tenant Bill Fredericks pays rent for the property at 47 Robert St of $1500 with a cheque.

8/4/2013 The tenant Ray Richards pays rent for the property at 65 Martin St by cash $1200.

13/4/2013 BAC Commercial pays monthly rent of $2000 by EFT.

15/4/2013 The tenant Jill Sharp pays by EFT the rental of $1350 for 15 Drysdale Ave.

20/4/2013 Fred Sykes signs a contract to buy Ted Johnson’s house for $535,000.00. He pays 2% ($10,700.00) at the signing of the contract with the balance of the deposit to be paid in 3 days. The contract is due to settle in 30 days.

23/4/2013 Fred Sykes pays the rest of the deposit - $42,800.00.

The air conditioning unit needs replacing at 47 Robert St. This will cost $1900. The tenant wants it done immediately. So John Jones agrees to this and asks you take the necessary funds from the rental at 47 Robert St and the balance from the rental at 65 Martin St. You need to transfer the funds so that the account can be paid and you need to allow for the commission to be paid to the office in the figuring.

28/4/2013 The unit is repaired on 28/4/2013. A cheque (cheque no 1434) is paid that day to Aircold Air-conditioning for $1900.

30/4/2013 You will pay the rent owing to James Smithson with Chq no 1435

You will pay the rent owing John Jones with Chq no 1436

You will pay the commission for both of these to the General Account using Chq no 1437

You receive an account from the Agency general account for the advertising fee of $350.00 for Ted Johnson’s house. Pay with Chq no 1438

3/5/2013 Sale of a house at 150 White St Wodonga for D & S Gregson is finalised. The sale price was for $388,000.00. The agency has held the deposit of $38,800 in its trust account. You now need to finalise this account and pay the commission to the agency and send the remaining funds to the Solicitor, Agnew and Fortescue, for settlement. The commission is 2.5% of the value. There will be a $20.00 accounting fee added as well. The Purchaser is B. Archer of 40 Black Rd Wodonga. You will use Chq no 1439 for Agnes & Fortescue and Chq no 1440 for the commission.

3/5/2013 The tenant Bill Fredericks pays rent for the property at 47 Robert St of $1500 with a cheque.

5/5/2013 Bill Frederick’s cheque is dishonoured.

7/5/2013 Bill Frederick pays the rent by cash.

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CPP40307 Certificate IV in Property Services (Real Estate) © 2015 National Real Estate Learning Page 35

ASSESSMENT TASK 5

Date Information

7/5/2013 You receive a deposit from R. Ramirez of 14 Dapto St Wodonga, for the house of A. Jackson at 69 O’Brien Crescent. The full 10% deposit has been received. Deposit amount is $56,900.00

8/5/2013 The tenant Ray Richards pays rent for the property at 65 Martin St by cash $1200.

13/5/2013 BAC Commercial pays monthly rent of $2000 by EFT.

15/5/2013 The tenant Jill Sharp pays by EFT the rental of $1350 for 15 Drysdale Ave.

20/5/2013 Fred Sykes settles the sale of Ted Johnson’s house for $535,000.00. You now need to finalise this account and pay the commission to the agency and send the remaining funds to the Solicitor, Reddy and Co Pty Ltd, for settlement (Chq no 1441). The commission is 2.5% of the value. There will be a $20.00 accounting fee added as well. (Chq no 1442)

30/5/2013 You will pay James Smithson (Chq no 1443) and John Jones (Chq no 1444) the rents owing them less the commissions and statement fees.

You will pay the General Account the commission owing with Chq no 1445

Prepare a formal letter to each of the property owners and issue along with their monthly statements.

Prepare an informal letter and a copy of the statements for the principal of the agency.

Version 1.1 - Aug 2020