Financial Accounting and Performance Analysis

ASSESSMENT
Table of Contents

INTRODUCTION...........................................................................................................................3
PART-A ...................................................................................................................................3
a) JOURNAL...............................................................................................................................3
b) LEDGER.................................................................................................................................4
c) Trial Balance as at 31 October 2020........................................................................................8
d) Income Statement for the period ended 31 October 2020.......................................................9
e) Balance Sheet as at 31 October 2020.......................................................................................9
PART-B.........................................................................................................................................10
Calculation of ratios for Linda's business..................................................................................10
Analysis of Linda's performance with reference to its competitor's performance.....................11
CONCLUSION .............................................................................................................................13
REFERENCES................................................................................................................................1

INTRODUCTION
The present report is the illustration of financial accounting associated with the sole
proprietorship concern. The report begins from passing journal entry, then posting the same into
ledger, extracting trial balance, preparing income statement and balance sheet to know the
financial position of the business (Schroeder, Clark and Cathey, 2019). And finally the report
will be ended by comparing Linda's business performance with that of its competitors.
PART-A
a) JOURNAL
Date Particulars Debit Credit
2020
1 October Bank A/c
Cash A/c
Van A/c
To Capital A/c
(Being business started with bank, cash and van)
8000
5200
3000
16200
2 October Laptop A/c
To Bank A/c
(Being laptop purchased and paid by cheque)
1000
1000
4 October Purchase A/c
To Toys Ltd.
(Being goods purchased on credit)
2450
2450
5 October Bank A/c
To Sales A/c
(Being goods sold for cash)
1500
1500
12 October Repairs A/c
To Cash A/c
(Being Laptop repaired and paid through cheque)
80
80
18 October Toys Ltd. A/c
To Purchase A/c
100
100

(Being Goods returned to Toys Ltd.)
21 October Bank A/c
To Rent Received A/c
(Being Rent received for premises)
500
500
23 October Bank A/c
Fred A/c
To Sales A/c
(Being goods sold partly for cash and partly for
credit)
1500
400
1900
23 October Cash A/c
To Sales A/c
(Being goods sold for cash)
500
500
24 October Second-hand Car A/c
To Bank A/c
(Being second-hand car bought for business purpose)
2500
2500
26 October Wages A/c
To Bank A/c
(Being wages paid to shopkeeper)
820
820
30 October Rent A/c
To Bank A/c
(Being rent paid)
1000
1000
31 October **Drawings A/c
To Bank A/c
(Being Drawings made out of business bank account
for holiday)
1600
1600
**Note: Linda has spent amount of 1600 for her travel to Florida, which is nowhere mentioned
that the trip to Florida is for business purpose. So she must have to consider this amount as