Financial Accounting Statements Analysis

This assignment focuses on analyzing and preparing key financial statements including a Balance Sheet, Statement of Profit or Loss, Statement Showing Working Capital, Statement Showing Current Ratio, Statement Showing Profit Margin, Statement Showing Debt Ratio, and a Bank Reconciliation Statement (BRS). It utilizes provided data to calculate various ratios and demonstrate the relationship between different financial elements within a business.

Running head: ACCOUNTING
Accounting
Name of the Student:
Name of the University:
Authors Note:

1ACCOUNTING
Table of Contents
Problem 1.........................................................................................................................................2
Problem 2.........................................................................................................................................4
Reference.......................................................................................................................................15

2ACCOUNTING
Problem 1
Answers to Question 4-34:
C. To maximize net income
Answer to Question 4-35:
a. Sarbanes-Oxley Reform
Answer to Question 4-36:
D. Separation of duties.
Answer to Question 4-37:
b. The customer should be able to see the amount entered into the cash register
Answer to Question 4-38:
C. deducted from the bank balance.
Answer to Question 4-39:
B. Deducted from the book balance
Answer to Question 4-40:
A. $9 deduction from the book balance
Answer to Question 4-41:
D. No entry is required
Answer to Question 4-42:
C. Added to the book balance.

3ACCOUNTING
Answer to Question 4-43:
D. All of the above.

4ACCOUNTING
Problem 2
9/26/2016 cash $920.00 9/20/2016 Balance b/d $6,100.00 6/20/2019 Balance b/d $14,000.00
9/30/2016 cash $420.00
9/30/2016 Balance $4,760.00 9/30/2016 Balance $14,000.00
Total $6,100.00 Total $6,100.00 Total $14,000.00 Total $14,000.00
Salary Expenses Accounts Receivable
Date Particulars Amount Date Particulars Amount Date Particulars Amount Date Particulars Amount
9/20/2016 Balance b/d $37,000.00 9/20/2016 Balance b/d $7,500.00 9/29/2016 Cash $680.00
9/30/2016 Balance $37,000.00 9/30/2016 Balance $6,820.00
Total $37,000.00 Total $37,000.00 Total $7,500.00 Total $7,500.00
9/30/2016 Balance $37,000.00 9/30/2016 Balance $6,820.00
Total $37,000.00 Total $37,000.00 Total $7,500.00 Total $7,500.00
Dividend Service Revenue
Date Particulars Amount Date Particulars Amount Date Particulars Amount Date Particulars Amount
9/20/2016 balanec b/d $16,000.00 9/20/2016 Balance b/d $161,000.00
9/30/2016 Cash $1,266.00
9/30/2016 balance $16,000.00 9/30/2016 Balance $162,266.00
Total $16,000.00 Total $16,000.00 Total $162,266.00 Total $162,266.00
Accumulated depreciation Building Land

5ACCOUNTING
9/20/2016 Balance b/d $15,600.00
9/30/2016 Balance $15,600.00
Total $15,600.00 Total $15,600.00
Supply Inventory
Date Particulars Amount Date Particulars Amount
9/20/2016 Balance b/d $4,600.00
9/30/2016 Balance $4,600.00
Total $4,600.00 Total $4,600.00
Prepaid Insurance

6ACCOUNTING
Supply Inventory
Date Particulars Amount Date Particulars Amount
9/20/2016 Balance b/d $4,600.00
9/30/2016 Balance $4,600.00
Total $4,600.00 Total $4,600.00
Prepaid Insurance
Date Particulars Amount Date Particulars Amount
9/20/2016 Balance b/d $3,500.00
9/20/2016 Balance b/d $3,500.00
9/30/2016 Balance $3,500.00
Total $3,500.00 Total $3,500.00
Building
Date Particulars Amount Date Particulars Amount
9/20/2016 Balance b/d $110,000.00
9/30/2016 Balance $110,000.00
Total $110,000.00 Total $110,000.00

7ACCOUNTING
Building
Date Particulars Amount Date Particulars Amount
9/20/2016 Balance b/d $110,000.00
9/30/2016 Balance $110,000.00
Total $110,000.00 Total $110,000.00
Utilities Expenses
Date Particulars Amount Date Particulars Amount
9/20/2016 Balance b/d $2,000.00
9/30/2016 Balance $2,000.00
9/30/2016 Accounts Payable $420.00
9/30/2016 Balance $2,000.00 9/30/2016 balance $14,075.00
Total $2,000.00 Total $2,000.00 Total $16,111.00 Total $16,111.00
Office supplies Electricity bill
Date Particulars Amount Date Particulars Amount Date Particulars Amount Date Particulars Amount
Statement showing Trial balance (Un Adjusted)
Accounts Debit Credit
Service revenue $162,266.00
Salary Expenses $37,000.00
Advertising Expenses $7,300.00
Utilities Expenses $2,000.00

8ACCOUNTING
Office Supplies $310.00
Electricity bill $386.00
Dividend $16,000.00
Land $53,000.00
Building $110,000.00
Accounts Receivable $6,820.00
Supply Inventory $4,600.00
Prepaid Insurance $3,500.00
Cash $14,075.00
Unearned Service Revenue $5,500.00
Accumulated Depreciation Building $15,600.00
Accounts Payable $4,760.00
Retained Earnings $52,865.00
Common stock $14,000.00
Total $254,991.00 $254,991.00
Statement Showing Adjustment Journal Entry
Particulars Debit Credit
Unearned Service Revenue $1,650.00
Service Revenue $1,650.00
(Being unearned service revenue earned, now adjusted)
Salary $2,600.00
Salary Payable $2,600.00
(Being salary due adjusted for new executives)
Accounts receivable $35,000.00
Service revenue $35,000.00
(Being accrued service revenue adjusted)
Material Consumed $3,100.00
Supply Inventory $3,100.00

9ACCOUNTING
(Being inventory consumed now adjusted)
Insurance Expenses $1,500.00
Prepaid Insurance $1,500.00
(Being insurance expenses adjusted)
Salary $37,000.00
Salary Payable $ 37,000.00
(Being salary due adjusted for half month)
Depreciation $2,600.00
Accumulated Depreciation $2,600.00
(Being depreciation adjusted)

10ACCOUNTING
Insurance Expenses $1,500.00 $1,500.00
Depreciation Expenses $2,600.00 $2,600.00
Dividend $16,000.00 $16,000.00
Land $53,000.00 $53,000.00
Building $110,000.00 $110,000.00
Accounts Receivable $6,820.00 $35,000.00 $41,820.00
Supply Inventory $4,600.00 $3,100.00 $1,500.00
Prepaid Insurance $3,500.00 $1,500.00 $2,000.00
Cash $14,075.00 $14,075.00
Unearned Service Revenue $5,500.00 $5,500.00
Accumulated Depreciation Building $15,600.00 $2,600.00
Accounts Payable $4,760.00
Salary Payable $63,000.00
Retained Earnings $52,865.00
Common stock $14,000.00
Total $254,991.00 $254,991.00 $110,700.00 ### $355,591.00
Income Statement
Particulars Amount Amount
Revenue
Service revenue $202,766.00
Expenses
Material Consumed $3,100.00
Salary Expenses $100,000.00
Advertising Expenses $7,300.00
Utilities Expenses $2,000.00
Office Supplies $310.00

11ACCOUNTING
Electricity bill $386.00
Insurance Expenses $1,500.00
Depreciation Expenses $2,600.00
Dividend $16,000.00
Total Expenses $133,196.00
Net Profit $69,570.00
Balance Sheet
Amount Amount
Assets
Non-Current Assets
Land $53,000.00
Building $110,000.00
Total $163,000.00
Current Assets
Accounts Receivable $41,820.00
Supply Inventory $1,500.00
Prepaid Insurance $2,000.00
Cash $14,075.00
Total $59,395.00
Total Assets $222,395.00
Liability
Current Liability
Accumulated Depreciation Building $18,200.00
Accounts Payable $4,760.00
Salary Payable $63,000.00
Total Current Liability $85,960.00
Net Assets $136,435.00
Retained Earnings $122,435.00
Common stock $14,000.00
Total Owners Equity $136,435.00
Statement Showing Retained Earning

12ACCOUNTING
Particulars Amount
Opening Balance $52,865.00
Add:
Profit $69,570.00
Closing $122,435.00
Journal Showing Closing Entries
Particulars Debit Credit
Service revenue $202,766.00
PL Statement Account $202,766.00
(Being revenue transferred to PL)
PL Statement Account $133,196.00
Material Consumed $3,100.00
Salary Expenses $100,000.00
Advertising Expenses $7,300.00
Utilities Expenses $2,000.00
Office Supplies $310.00
Electricity bill $386.00
Insurance Expenses $1,500.00
Depreciation Expenses $2,600.00
Dividend $16,000.00
(Being expenses account closed by transferring to PL)
Net Profit $69,570.00
Retained Earning $69,570.00
(Being profit transferred to retained earnings)
Post-Closing Trial Balance
Accounts Debit Credit
Land $53,000.00
Building $110,000.00
Accounts Receivable $41,820.00
Supply Inventory $1,500.00
Prepaid Insurance $2,000.00
Cash $14,075.00
Accumulated Depreciation Building $18,200.00

13ACCOUNTING
Accounts Payable $4,760.00
Salary Payable $63,000.00
Retained Earnings $122,435.00
Common stock $14,000.00
Total $222,395.00 $222,395.00
Statement Showing Working capital
Particulars Amount
Current Assets $163,000.00
Less:
Current Liabilities $85,960.00
Working capital $77,040.00
Statement Showing Current Ratio
Particulars Amount
Current Assets $163,000.00
Current Liabilities $85,960.00
Current ratio (CA/CL) 1.90
Statement Showing Profit Margin
Particulars Amount
Net Profit $69,570.00
Sales Revenue $202,766.00
Profit margin ratio 34%
Statement Showing Debt Ratio
Particulars Amount
Debt $85,960.00
Total Assets $222,395.00
Debt ratio 0.39
Statement showing BRS
Particulars Amount

14ACCOUNTING
As per cash book $14,075.00
Add:
Check not presented $1,116.00
Less:
Deposit not in bank statement $1,266.00
Balance as per pass book $13,925.00

15ACCOUNTING
Reference
Beatty, A. and Liao, S., 2014. Financial accounting in the banking industry: A review of the
empirical literature. Journal of Accounting and Economics, 58(2), pp.339-383.
Pratt, J., 2016. Financial accounting in an economic context. John Wiley & Sons.
Renz, D.O., 2016. The Jossey-Bass handbook of nonprofit leadership and management. John
Wiley & Sons.
Weil, R.L., Schipper, K. and Francis, J., 2013. Financial accounting: an introduction to
concepts, methods and uses. Cengage Learning.