Recording Business Transaction and Accounting Information

This report covers the stages to start a new business, role of financial accounting, and how to record business transactions. It includes journal entries, trial balance, and income statement for B Moore. The impact of COVID-19 on business profitability is also discussed.

Recording Business
Transaction

Table of Contents
INTRODUCTION ............................................................................................................................3
Explain stage to start a new business............................................................................................3
Role of the financial accounting and responsible individual for decision making process...........3
Part B .................................................................................................................................................4
2. (a) Post the Journal entries into the General Ledger Accounts.................................................5
2. (b) Make the trail balance on 31st August, 2021.......................................................................7
PART C..............................................................................................................................................7
(a) Make the income Statement of B Moore for the year ending on 30th September, 2021.........7
b Analysis of income statement and ratio. Explain reason of changing profit in business
organisation...................................................................................................................................8
CONCLUSION .................................................................................................................................8
REFERENCES...................................................................................................................................9

INTRODUCTION
The business transaction take place between two or more parties in which it involve
exchange of of services and goods for some type of consideration. All these transactions basically
record in books of accounts that is ledger and journal. After this these transaction posted to their
respective ledger (Frankot, 2020). Company chosen in this report is Marks and Spencer.
Commencement of the decorator's business is described in this report, Journal entries, trial
balances and income statements are created for the specified transactions.
Explain stage to start a new business
David is a decorator and want to start a new business himself. He want to be sole
proprietor of his business. Therefore, to start his business he need to face all stages which are
mentioned below:
 Firm's registration- First of the all, the owner need to register his company in order to get
license for running his business.
 Business idea- To start a new business, he require a blue print for operate a business.
 Develop business plan- The owner need to implement his blue print to business
(Downey, Bauchot and Röling, 2018).
 Technology strategy- For this, it need to create a technical roadmap in order to
understand the firm's requirements regarding technology.
 Community Network- This network help the business in maintaining business relations.
Role of the financial accounting and responsible individual for decision making process.
The accounting include recording, recognising, analysing interpreting, distributing and
communication an accounting information to different users. Financial position of a company is
analysed by accounting system (Zelditch, ed., 2018).
Bookkeeping information
 Owner- They may use the company's information as per their wish. They have right to
know financial position and profitability of the company.

 Management- Stockholder and management are different from each other. Management
take business decision as per the objective of organisation (Gomaa, Gomaa and Stampone,
2019).
 Investors- These members of the company analyse final account of a business to know
organisational financial position. In context of Marks and Spencer, its investor refer to
annual report of the respective company.
Part B
1. Post the Journal entries in the books of F Polk.
Journal of F Polk for the month September
Date Details Fol Debit Credit
01/09/21 Assets A/c
Fixtures
Stock
Debtors (105 + 311)
Bank
Cash
Creditors (229 + 80)
Capital
5700
2800
5200
416
1060
85
309
14952
01/09/21 Bad Debts
P Mullen
(Bad Debts written-off)
105
105
05/09/21 Payables
Office Fixtures
(Office fixtures bought through credit was written-off)
150
150

10/09/21 Cash
Bad Debts
M Abel
(M Abel declared bankruptcy and received the amount in
full settlement)
180
131
311
18/09/21 Machinery
Cash
Bank
Payables
(Purchased a machinery and the amount paid by cheque,
cash and on credit)
1800
100
500
1200
26/09/21 Payables
Bank
(Half of the amount due paid through cheque)
600
600
28/09/21 Insurance Expenses
Drawings
Bank
(Insurance expenses paid by bank but later realised that
£70 is of personal house)
60
70
130
2. (a) Post the Journal entries into the General Ledger Accounts.
Cash Account
Date Particulars Fol Amount Date Particulars Fol Amount
03/08/21 Bank 2800 15/08/21 Office Fixtures 110
25/08/21 Bank 430
31/08/21 Balance c/d 2260
2800 2800
1/09/21 Balance b/d 2260

Bank Account
Date Particulars Fol Amount Date Particulars Fol Amount
01/08/21 Capital 36800 03/08/21 Cash 2800
25/08/21 Cash 430 04/08/21 Van 6200
02/08/21 Loan Payable 12400 05/08/21 Office Fixtures 1000
19/08/21 Van (Mercedes Plc) 8700
28/08/21 Office Fixtures 750
31/08/21 Balance c/d 30180
49630 49630
1/9/21 Balance b/d 30180
Van Account
Date Particulars Fol Amount Date Particulars Fol Amount
01/08/21 Capital 32000
04/08/21 Bank 6200 31/08/21 Balance c/d 46900
08/08/21 Toyota Co. 8700
46900 46900
1/9/21 Balance b/d 46900
Office Fixtures
Date Particulars Fol Amount Date Particulars Fol Amount
01/08/21 Capital 1200
05/08/21 Cash 1000
05/08/21 Payables 2400 31/08/21 Balance c/d 5460

15/08/21 Cash 110
28/08/21 Bank 750
5460 5460
1/9/21 Balance b/d 5460
Payables Account
Date Particulars Fol Amount Date Particulars Fol Amount
19/08/21 Bank 8700 5/08/21 Office Fixtures 2400
31/08/21 Balance c/d 2400 08/08/21 Van 8700
8700 8700
1/9/21 Balance b/d 2400
Loan Payable Account
Date Particulars Fol Amount Date Particulars Fol Amount
31/08/21 Balance c/d 12400 02/08/21 Bank 12400
12400 12400
1/9/21 Balance b/d 12400
Capital Account
Date Particulars Fol Amount Date Particulars Fol Amount
31/08/21 Bank 70000
31/08/21 Balance c/d 70000
70000 70000
1/09/21 Balance b/d 70000

2. (b) Make the trail balance on 31st August, 2021.
TRIAL BALANCE of Maurice & Brothers as at August, 2021
Details Debit Credit
Bank 30180
Cash 2260
Van 46900
Office Fixtures 5460
Payables 2400
Loan Payable 12400
Capital 70000
TOTAL 84800 84800
PART C
(a) Make the income Statement of B Moore for the year ending on 30th September, 2021
Income Statement of B Moore for the year ending on September 2021
Details Amount (£)
Sales 95000
Less: Sales Returns (3500)
Net Sales 91500
Opening Stock 18000
Purchases 110000
Less: Return Outwards (720)
Add: Carriage Inwards 890
Less: Closing Stock 13000
Cost of Goods Sold 115170

Gross Loss -23670
Less: Motor Expenses 1400
Carriage Outward 500
Rent 7000
Telephone Charges 830
Wages and Salaries 14000
Insurance 1030
Office Expenses 800
Sundry Expenses 250
Operating Expenses 25810
Net Loss -49480
b Analysis of income statement and ratio. Explain reason of changing profit in business
organisation
Pandemic is beneficial for some of the organisation that come under the emergency
service. But some business are bot able to overcome and recover form this situation. In income
statement it is analysed that the income is less than the expenditure due to the COVID 19.
Understanding the impact of venture and monetary results is critical for owners of business and
firms (Mohan and Gladston, 2020).
CONCLUSION
From the above report it is concluded that to start a new business it is essential to have a
business plan. Further, all the transaction are posted in ledger and journal accounts in books of the
F Polk. The considered company is listed in stock exchange of London. Its user of accounting
information also explained. Income statement of the B Moore prepared and comparative analysis
also done on the ratio of competitor.

REFERENCES
Books and Journals
Downey, L.X., Bauchot, F. and Röling, J., 2018. Blockchain for business value: A contract and
work flow management to reduce disputes pilot project. IEEE Engineering Management
Review, 46(4), pp.86-93.
Frankot, E., 2020. Legal business outside the courts: private and public houses as spaces of law in
the fifteenth century. In Cultures of Law in Urban Northern Europe (pp. 173-191).
Routledge.
Gomaa, A.A., Gomaa, M.I. and Stampone, A., 2019. A transaction on the blockchain: An AIS
perspective, intro case to explain transactions on the ERP and the role of the internal and
external auditor. Journal of Emerging Technologies in Accounting, 16(1), pp.47-64.
Mohan, A.P. and Gladston, A., 2020. Merkle tree and Blockchain-based cloud data auditing.
International Journal of Cloud Applications and Computing (IJCAC), 10(3), pp.54-66.
Zelditch, M. ed., 2018. Status, Power, and Legitimacy. Routledge.