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Assignment Task 1: Q 1.1 Principles A. The Accounting Equation
Assignment Task 1: Q 1.1 Principles A. The Accounting Equation
Assignment Task 1: Q 1.1 Principles A. The Accounting Equation
Q 1.1
Principles
A. The accounting equation:
Through a very simple formula this helps in explaining in the financial statements of a
business entity.
.
ASSETS = LIABILITIES + CAPITAL
/
LIABILITIES = CAPITAL ASSETS
/
CAPITAL = ASSETS LIABILITIES
These are equations which helps us to calculate all the transactions of the accounting
periods. So it helps in making financial statement as well.
B. The nature of business entity:
If the nature of business is financial then its balance sheet will be different because
most of its expenses are done in profit and loss method so the balance will also be
different so making the financial statement is different for different business entity.
C. The cost period:
If the company receives its debts in a small time its balance sheet can show more
profit but if the company receive its debt in a longer period its balance sheet can show
more loss.
Concepts:
D. Relevant:
The data that is made should be relevant to what organisation has asked and should be
related to organisation.
E. Understandable:
The data which is created in the balance sheet or any other transaction which is
created by the company member they need to be create that information very clearly
and if someone try to read that information it easily for him to read all the information
perfectly.
F. Reliable:
The information or the transaction which we created for the financial statement should
be reliable and there is no problem to understand the concept.
G. Comparable:
The information and the balance sheets which we made it should be similar to the
other companies and easily compare with other companies because it should be
similar to other companies data or the information for the financial statements.
Because if anyone want to compare the information of those companies it will be
similar to each other.
H. Material:
All the expenses or the losses should be made it very important to clear these in the
balance sheets of revenue clearly. And the thing all the tangible and intangible assets
should be mentioned separately.
Q 1.2
Name of my company is JB Hi If:
ASSIGNMENT TASK 2:
2.1.
a) Accounting equations
Date
1/11/14
Assets
Bank:
35,000
Expenses
5/11/14
Bank: 34500
Rent: 500
6/11/14
Bank:
22,500
Furniture:
12,000
Bank:
22,500
Furniture:
12,000
Equipment:
5,000
Bank:
14,500
Furniture:
12,000
Equipment:
5,000
Stock: 8,000
Bank:
14,500
Furniture:
12,000
Equipment:
5,000
Stock: 8,000
Accounts
Receivables:
2,500
Bank:
14,300
Furniture:
12,000
8/11/14
11/11/14
12/11/14
15/11/14
Drawings
Liabilities
Loan: 5000
Loan: 5000
Loan: 5000
Purchases:
8,000
Electricity
Bill: 200
Income
Equity
Owners
Capital
30,000
Owners
Capital
30,000
Owners
Capital
30,000
Loan:
5,000
Accounts
Payable:
5,000
Owners
Capital
30,000
Loan:
5,000
Accounts
Payable:
5,000
Owners
Capital
30,000
Loan:
5,000
Accounts
Payable:
5,000
Owners
Capital
30,000
Loan:
5,000
Accounts
Payable:
Owners
Capital
30,000
16/11/14
23/11/14
29/11/14
Equipment:
5,000
Stock: 8,000
Accounts
Receivables:
2,500
Bank:
14,300
Furniture:
12,000
Equipment:
5,000
Stock: 8,000
Accounts
Receivables:
2,500
Bank:
14,300
Furniture:
12,000
Equipment:
5,000
Stock: 8,000
Bank:
13,700
Furniture:
12,000
Equipment:
5,000
Stock: 8,000
5,000
Purchases:
6,400
Loan:
5,000
Accounts
Payable:
11,400
Loan:
5,000
Accounts
Payable:
11,400
Drawings:
600
Loan:
5,000
Accounts
Payable:
11,400
Owners
Capital
30,000
Accounts
Receivables:
2500 Bad
Debts: 50
Owners
Capital
30,000
Owners
Capital
29,400
Date
Particulars
1/11/14
Bank A/c dr
To Equity Account
To Loan Account
Debit $
(NZD)
35,000
Credit $
(NZD)
30,000
5,000
5/11/14
6/11/14
8/11/14
11/11/14
12/11/14
15/11/14
16/11/14
23/11/14
29/11/14
Rent A/c dr
To Bank
Furniture A/c dr
To Bank
Equipment A/c dr
To Accounts Payables
Purchases A/c dr
To Cash
Accounts Receivable A/c dr
To Sales
Electricity A/c dr
To Bank
Purchases A/c dr
To Accounts Payable
Bank A/c dr
Bad Debts A/c dr
To Accounts Receivables
Drawings A/c Dr
To Bank
500
500
12,000
12,000
5,000
5,000
8,000
8,000
2,500
2,500
200
200
6,400
6,400
2,450
50
2,500
600
600
Ledger Accounts
Plant and Machinery
Bank Balance
Interest Received
Discount allowed
Accounts Receivables
Bank Overdraft
5 Years Loan from Bank
Commission Received
Accounts Payable
Building
Sales
Profits
Drawings
Power Bill
Advertising
Investment
Classification
Non-Current Assets
Current Assets
Revenue
Expense
Current Assets
Current Liabilities
Non-Current Liabilities
Revenue
Current Liabilities
Non-Current Liabilities
Revenue
Revenue
Equity
Expense
Expense
Equity
Bank Account
Dr
Dat
e
1
4
19
23
31
Particulars
Amount
Opening Balance
Sales
Accounts Receivables
4,500
Less: Bad Debts
-100
Rent A/c
Closing Balance
12,500
900
Dat
e
2
14
16
22
24
29
29
4,400
750
5090
31
_____
23,640
Particular
Amount
500
2,000
250
11,500
340
5,000
550
3,500
_____
23,640
Sales Account
Dr
Date
24
31
Particulars
Sales Return A/c
Closing Balance
Amount
340
560
___
900
Date
4
Particulars
Bank A/c
Amount
900
___
900
Purchases Account
Dr
Date Particulars
9
Accounts Payable
31 Bank A/c
Amount
5,300
____
5,300
Dr
Date Particulars
2
Bank A/c
Amount
500
Date Particulars
31 Closing Balance
Amount
500
___
500
___
500
Computer Account
Dr
Date Particular
14 Bank A/c
Amount
2,000
____
2,000
Date Particular
31 Closing balance
Amount
2,000
____
2,000
Amount
250
___
250
Date Particulars
31 Closing balance
Amount
250
___
250
Salary Account
Dr
Date Particular
22 Bank A/c
Amount
11,500
_____
11,500
Date Particular
31 Closing Balance
Amount
11,500
_____
11,500
Rent Account
Dr
Date Particulars
31 Closing Balance
Amount
750
___
750
Dr
Date Particulars
29 Bank A/c
Amount
5,000
____
5,000
Date Particulars
31 Closing Balance
Amount
5,000
____
5,000
Machinery Account
Dr
Date Particulars
30 Monthly installment A/c
Amount
28,000
_____
28,000
Date Particulars
31 Closing balance
Amount
28,000
_____
28,000
Amount
28,000
_____
28,000
Date Particulars
30 Machinery A/c
Amount
28,000
_____
28,000
Amount
340
___
340
Date Particulars
24 Sales A/c
Amount
340
___
340
Amount
32,600
_____
32,600
Date Particulars
19 Bank A/c
4500
31 Less: Bad Debts
-100
Closing Balance
Amount
4400
28,200
_____
32,600
Accounts Payable
Dr
Date Particulars
29 Bank A/c
550
31 Add: Discount
50
Closing Balance
Amount
Date Particulars
1
Opening Balance
600
8,800
____
9,400
Amount
9,400
____
9,400
Capital Account
Dr
Date Particulars
31 Closing Balance
Amount
33,300
_____
33,300
Date Particulars
1
Opening Balance
Amount
33,300
_____
33,300
Drawings Account
Dr
Date Particulars
1
Opening Balance
Amount
2,400
____
2,400
Date Particulars
31 Closing Balance
Amount
2,400
____
2,400
Trial Balance
Dr
Particulars
Bank
Purchases
Electricity
Computer
Telephone Bill
Term Deposit @ 6%
Amount
5090
5,300
500
2,000
200
5,000
Particulars
Sales
Rent
Machinery installment
Accounts Payable
Capital
Amount
560
750
28000
8,800
33,300
Accounts Receivable
Drawings
28,200
2,400
_____
48,690
_____
48,690
ASSIGNMENT TASK 3:
Classification
Investment Assets
Expenses
Income
Current Assets
Income
Expense
Current assets
Non Current Liabilities
Goodwill
Prepaid Insurance
Vehicle purchased for a Car Dealer
Intangible Assets
Current Assets
Investment Assets
No.
a.
b.
c.
d.
e.
Particulars
Commission A/c dr
To Bank A/c
Bank A/c dr
To Rent A/c
Prepaid Insurance A/c dr
To Bank A/c
Interest A/c dr
To Bank A/c
Bank A/c dr
To Accumulated Depreciation A/c
Amount NZ $ (Dr)
200
Amount NZ $ (Cr)
200
400
400
500
500
100
100
4000
4000
Amount $
36,000
6,500
3,600
10,000
56100
Particulars
Accumulated Depreciation
Commission Received
Interest on Term Deposit
Capital
Amount $
4,000
1,000
500
50600
56100
Particulars
Sales
Less: Sales Return
Net Sales
Less: Cost of Goods Sold
Gross Profit
Add: Incomes
Carriage inwards
Rent received
Total Income
Less: Expenses
Insurance
Salary and wages
Delivery van expenses
Bad Debts
Depreciation
Telephone Expenses
Electricity
Total Expenses
Calculations $
91,000
-3,400
-12200
Final Amount $
87600
___________
75400
1100
+5400
+6500
-1500
-37500
-1500
-1400
-8000
-1600
-6000
-57500
_____
24400
Calculations $
Final Amount $
12700
9400
1400
7800
233.33
(1500)
30033.33
50000
Total Assets
80033.33
Current Liabilities:
Accounts Payable
Accrued Electricity
Accrued Rent
2300
(300)
(600)
(1400)
(20233.33)
_____
58400
_____
58400
Net Assets
Closing Capital
Property plant and Equipment
Original Cost
Accumulated Depreciation
Depreciation for the year
Accumulated Depreciation
Carrying out
Equipment $
20000
4000
2000
6000
_____
14000
Vehicles $
60000
18000
6000
24000
_____
36000
Total Amount $
80000
22000
8000
30000
_____
50000
Changes in Equity
Particulars
Opening Capital
Add: Contribution during the year
Less: Drawings
Add: Profit of the Year
Closing Capital of 31st March 20X3
Amount
39,000
+5000
-10000
+24400
_____
58,400
Date
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
Particulars
Amount $ Dr
Cash at Bank
3,000
Accounts Receivable
6,000
Opening Stock of Goods
12,500
Prepaid Insurance
500
Premises
120,000
Delivery Vehicles
40,000
Catering Equipment
70,000
To Bank Overdraft
To Accounts Payable
To Outstanding Electricity Bill
To Advanced Fees Received
To Loan from Bank
To Accumulated Depreciation on Premises
To Accumulated Depreciation on Delivery
Vehicles
To Accumulated Depreciation on Catering
Equipment
To Capital
252000
Amount $ Cr
4000
7,000
1,000
3,000
30,000
40,000
23,000
33,000
111,000
25,2000
Ledger Accounts
Note: all the amounts are in NZ $
Bank Account
Dr
Date
1/4/X3
Particulars
Balance
Amount $
3,000
Date
Particulars
Amount $
Particulars
Balance
Amount $
6,000
Date
Particulars
Amount $
Particulars
Balance
Amount $
12,500
Date
Particulars
Amount $
Particulars
Balance
Amount $
500
Date
Particulars
Amount $
Particulars
Amount $
Premises Account
Dr
Date
1/4/X3
Particulars
Balance
Amount $
120,000
Date
Particulars
Balance
Amount $
40,000
Date
Particulars
Amount $
Particulars
Balance
Amount $
70,000
Date
Particulars
Amount $
Particulars
Amount $
Particulars
Balance
Amount $
4,000
Date
Particulars
Balance
Amount $
7,000
Date
Particulars
Amount $
Particulars
Balance
Amount $
1,000
Date
Particulars
Amount $
Particulars
Balance
Amount $
3,000
Date
Particulars
Amount $
Particulars
Balance
Amount $
30,000
Date
Particulars
Amount $
Particulars
Balance
Amount $
40,000
Date
Particulars
Amount $
Particulars
Balance
Amount $
23,000
Date
Particulars
Amount $
Date
1/4/X3
Particulars
Balance
Amount $
33,000
Date
Particulars
Amount $
Particulars
Amount $
Capital Account
Dr
Date
1/4/X3
Particulars
Balance
Amount $
111,000
REFERENCE:
1. www.google.com
2. www.wikipedia.org
3. Learning Resource of US 1852
Date