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Accounting | Principles of Financial Accounting

   

Added on  2019-12-28

23 Pages5831 Words122 Views
FINANCIALACCOUNTINGPRINCIPLE

Table of ContentsINTRODUCTION................................................................................................................................4CLIENT 1.............................................................................................................................................4a) Prime Book entry.....................................................................................................................4TASK 1.................................................................................................................................................41. Drawing journal entries and calculation of owners capital.....................................................4A. Preparing the books of Prime Entry........................................................................................4b) Complete double entry recording............................................................................................6Draw trial balance......................................................................................................................12TASK 2...............................................................................................................................................13a. Preparing statement of profit and loss....................................................................................13b. Preparation of balance sheet..................................................................................................14TASK 3...............................................................................................................................................15a. Framing profit and loss a/c for Raintree Ltd..........................................................................15b. Statement of financial position of Rain tree Ltd....................................................................15c. Explaining the accounting concept of consistency and prudence..........................................17d. Illustrating two widely used methods of depreciation along with their appropriateness.......17TASK 4...............................................................................................................................................17a. Explaining the purpose of preparing bank reconciliation statement......................................17b. Assessing the reasons due to which bank records vary from cash book...............................18c..................................................................................................................................................18Bank reconciliation statements as at 1 December 2016............................................................18Prepare updated cash book........................................................................................................19Bank reconciliation statements as at 31st December..................................................................19CLIENT 5...........................................................................................................................................20A) prepare and balance books of Henderson for May 2016......................................................20Sales ledger control account......................................................................................................20Purchase ledger control account................................................................................................21b) Explain the term control account and needs to prepare control account...............................21CLIENT 6...........................................................................................................................................21a. Describing suspense account along with its main features....................................................21

b. Drafting a trial balance by using control account as balancing figure...................................22c..................................................................................................................................................22d. Differentiating suspense and clearing account......................................................................22CONCLUSION..................................................................................................................................23REFERENCES...................................................................................................................................24

INTRODUCTIONRole of financial accounting is increases with the increasing difficulties in the externalenvironment. Accounting is regarded as one of the important tool in the business as it help anindividual in order to gain higher market advantage over its variety of competitors located in theexternal market by managing existing financial resources. Final output generated by an entity isto determine the financial performance of an entity form of various financial statements such asincome statements, balance sheet or cash flow statements prepared by an entity after consideringeach and every aspects of their business. This project is all about recording all the transactionsstarting from journal till the preparation of financial statements such as income statements andbalance sheet in determining current ability of the business in order to strengthen its currentbusiness.CLIENT 1a) Prime Book entryTASK 11. Drawing journal entries and calculation of owners capital A. Preparing the books of Prime Entry Journal of Alex Study’s for the month of May 2016S. No.ParticularsDebitCredit1.Storage expenses a/c Dr.To bank a/c 4004002.Purchase a/c Dr.To S. Hood a/c To D. Main a/c To W. Tone a/c To R. Foot a/c 60801450206096016103.J Wilson a/c Dr. T. Cole a/c Dr.F. Syme a/c Dr. J. Allen a/c Dr.P. White a/c Dr.F. Lane a/c Dr.To sales a/c 112016402080910242077089404.Motor car expenses a/c Dr.To cash a/c 4704707.Drawing a/c Dr.1500

To cash a/c 15009.T. Cole a/c Dr.J. Fox a/c Dr.To sales a/c 680131011.Sales return a/c Dr. To J. Wilson To F. Syme a/c 68027041014Van a/c Dr.To Abel Motors Ltd 285002850016(a). Bank a/c Dr. Discount allowed a/c Dr. To P Mullen (b) Bank a/c Dr. Discount allowed a/c Dr. To F. Lane (c)Bank a/c Dr. Discount allowed a/c Dr. To J. Wilson (d)Bank a/c Dr. Discount allowed a/c Dr. To F. Syme1330702945155807.542.51586.583.514003100850167019R. Foot a/c Dr.To purchase return a/c 505022Purchase a/c Dr. To L. Mole a/c To W. Wright a/c 37401830191024a.S. Hood a/c Dr.To Bank a/c To Discount receive a/c b.J. Brown a/c Dr.To Bank a/c To Discount receive a/c c.R. Foot a/c Dr.To Bank a/c To Discount receive a/c 36004600140032403604140460140126027Salaries a/c Dr. To bank a/c 4800480030Business rates a/c Dr 1320

To bank a/c 132031Abel motors Ltd. a/c Dr. To bank a/c 2050020500b) Complete double entry recordingSales Journal accountDateParticularsAmountDateParticularsAmount31/05/16To balance C/d131003/05/16BY J. Wilson112003/05/16By T. Cole164003/05/16By F. Syme208003/05/16By J. Allen91003/05/16By P. White242003/05/16By F. Lane77009/05/16T. Cole68009/05/16J. Fox131013101310Sales Return Journal accountDateParticularsAmountDateParticularsAmount11/05/17To J. Wilson27031/05/16By Balance c/d68011/05/17To F. Syme410680Purchase Journal accountDateParticularsAmountDateParticularsAmount02/05/16To S. Hood145031/05/16By Balance c/d3832002/05/16To D. Main206002/05/16To W. Tone96002/05/16To R. Foot161014/05/16To Abel Motors Ltd2850022/05/16To L. Mole183022/05/16To W. Wright191038320Purchase Return Journal accountDateParticularsAmountDateParticularsAmount

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