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Inspirational Quotes

The Sales Ledger

Wed, 13 November 2002

A sales ledger is used to record, the sales for a month, how much cash was received when the cash was received; and what is currently owed to the business.
You should use the sales ledger to make a record of every invoice you issue.
 
A copy of each invoice should be retained, showing:
• the details of the work for which the invoice has been issued
• a unique invoice number
• your VAT registration number
• the VAT rate, and
• the amount of VAT.
 
Look at the sales ledger example below. Whenever you make a sale and issue a sales invoice, record the information as follows:
• Date: date on the invoice (note that this is also the tax point for VAT purposes);
• Details: name of customer;
• Ref: record the invoice number here (if these are consecutive it will make invoice retrieval easier should that be necessary);
• Gross: record here the total amount owing to you;
• VAT: if you are registered for VAT show the total VAT in this column; Columns F-M can be used for different types of sales.1 These might be different products; you may charge extra for delivery and wish to show this separately. This figure should be the net figure (ie without VAT) unless you are not registered for VAT in which case use the gross figure and ignore the VAT column completely. The figure in the gross column (D) should be equal to the total of all the other columns;
• Date received: when an invoice is paid record the date in this column. It is then very easy at the end of each month to see which invoices are still outstanding.
• Use a new page for each month. File the invoices safely in invoice number order.
 
You may also find it helpful to add up the outstanding debtors at the end of each month and make a note of the figure.
 
Example
During May, there have been nine invoiced sales totalling £14,300.00 plus £2,502.50 VAT. This business only makes one product, so all sales have been shown in column F. By the end of May, no invoice had been paid. But by the end of June, all except two of the invoices had been settled.
 
Sales Ledger
 
A
B
C
D
E
F
M
N
1
Date
Details
Ref
Gross
VAT
Net
 
Date rec'd
2
1/5
Butcher Books
01
822.50
122.50
700.00
 
8/6
3
3/5
Ogilvie and Co
02
2350.00
350.00
2000.00
 
3/6
4
4/5
Gary's Gardens
03
4112.50
612.50
3500.00
 
11/6
5
8/5
Watson Inc
04
470.00
70.00
400.00
 
20/6
6
10/5
Lanterns by Latimer
05
235.00
35.00
200.00
 
23/6
7
15/5
Gary's Gardens
06
2350.00
350.00
2000.00
 
 
8
20/5
Holmes & Gardens
07
587.50
87.50
500.00
 
18/6
9
28/5
Hunt plc
08
1175.00
175.00
1000.00
 
 
10
31/5
Shaw Ltd
09
4700.00
700.00
4000.00
 
28/6
11
 
 
 
 
 
 
 
 
26
 
 
 
 
 
 
 
 
27
 
 
 
 
 
 
 
 
28
 
Total
 
16802.50
2502.50
14300.00
 
 
29
 
Received
 
13277.50
 
 
 
 
30
 
Debtors outstanding
 
3525.00
 
 
 
 
 

 
1 Note that columns and rows have been labelled for ease of reference - but some columns and rows have been omitted from the example.

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