Journal Entries

Dr Cr
#1 Credit sales of $200,000
Dr. accounts receivables 200,000
Cr. Revenue 200,000

#2 Cash sales $6000

Dr Cash 6000
Cr. Revenue 6000

#3 collection from customers $150,000

Cr. Accounts receivables 150,000
Dr. Cash 150,000

#4 purchase of inventory on credit $70,000

Dr. inventory 70,000
Cr. Account payables 70,000

#5 payments of account payables $50,000

Dr. account payables 50,000
Cr. Cash 50,000

#6 costs of goods sold $80,000

Dr. expenses 80,000
Cr. Inventory 80,000

#7 wages expense $90,000 not yet paid

Cr. wages payable 90,000 * wages payable is also known as ac
Dr. expenses 90,000

#8 wages paid $22,000

Cr. Cash 22,000
Dr.wages payable 22,000

#9 paid tax payable $6000

Dr. tax expense 6000
Cr cash 6000

#10 Cash dividends of $20,000 declared and paid

Dr. Retained profits 20,000
Cr. Cash 20,000
DRAGONS LTD
Income Statement for 30 June 2019

$
Sales revenue 200,000
cash revenue 6000
COGS 80,000

Gross Profit 126,000

wages expense 90,000

Net Profit 36,000

DRAGONS LTD
BALANCE STATEMENT AS AT 30 JUNE 2019

ASSETS $ LIABILITIES
Current Assets Current Liabilities
cash 72,000 accounts payable
accounts receivable 86,000 tax payable
inventory 32,000 wages payable

Non-current assets Non-current liabilities

None none

Total Assets 190,000 Total Liabilities

Liabilities + Equity
wages payable is also known as accrual wages
$ EQUITY $ Retained profits = Opening retained
Share capital 40,000
32,000 Retained profits 50,000
0
68,000

100,000 Total Equity 90,000

$190,000
tained profits = Opening retained profits (34,000) + Profits (36,000) - Dividends (20,000) = 50,000