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13 Incomplete Records Notes
13 Incomplete Records Notes
13 Incomplete Records Notes
Aim: To show how an accountant can prepare the Final Accounts of a Sole Trader
from minimal unfinished information
1. Cash Book Method: here you have some starting information, some payments and
receipts made, usually a loan to handle, and some of the information from the closing
Balance Sheet. The secret to doing the question in the time available is to lay out the
question in blank form and fill in the information/figures as they are found.
2. Balance Sheet Method: quite similar to the Cash Book Method but the way we
complete the question is different. The initial roughwork is
The Opening Balance Sheet
A list of Drawings
Again we lay out the documents blank and focus on completing the Balance Sheet
first. We can calculate Net Assets and the Reserves is a missing figure to make the
Balance Sheet balance. Working backwards we can find Net Profit. Then we add on
the Expenses to find Gross Profit. Using the Gross Mark Up, we can find Cost of
Sales and Sales.
3. Ratios Method: we are given some figures for the final accounts with some ratios.
We put the figures into the blank documents and use the ratios to find the Working
Capital first, followed by Net Assets. We then find reserves and work back to find
Sales.