Financial Reports: Journal Entries, Ledgers, and Statements

This assignment delves into the core concepts of financial reporting, encompassing a range of accounting tasks. It begins with the recording of asset purchases, depreciation calculations, and the creation of corresponding journal entries and asset registers. The assignment further explores the preparation of rectification entries to correct accounting errors and the calculation of debt amounts, along with associated journal entries and ledger accounts. A significant portion of the work focuses on depreciation, including the creation of depreciation worksheets, journal entries for depreciation, and the preparation of ledger accounts to track accumulated depreciation. The student also prepares income statements and balance sheets, incorporating adjustments for depreciation. Finally, the assignment includes journal entries related to the disposal of old assets and the purchase of new ones, along with the preparation of a trial balance, profit and loss account, and balance sheet. The assignment concludes with an email communication related to the financial data. This comprehensive approach provides a robust understanding of financial reporting principles and practices.

Financial Reports

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 2............................................................................................................................................1
Journal entries for recording purchase of assets, deprecation and accumulated deprecation for
the year ended 30 June 2016 and 2017........................................................................................1
18. Preparation of asset registers.................................................................................................2
19. Preparation of rectification entries.........................................................................................3
20. Calculation of amount of debt and showing preparation of journal entries and ledger
accounts........................................................................................................................................3
TASK 3............................................................................................................................................3
1. Preparation of deprecation worksheet .....................................................................................3
2. Journal entries for depreciation on 30 june 2017.....................................................................4
3. Preparation of ledger accounts ................................................................................................4
4. Preparation of income statement and balance sheet showing adjustments of depreciation.....5
5. Showing journal entries relating to disposal of old truck and purchase of new truck.............5
TASK 4............................................................................................................................................6
1........................................................................................................................................................6
Journal entries .............................................................................................................................6
Ledger accounts ..........................................................................................................................6
2........................................................................................................................................................9
Email...........................................................................................................................................9
4......................................................................................................................................................10
a. Trial Balance .........................................................................................................................10
b. P&L account .........................................................................................................................11
c. Balance sheet .........................................................................................................................12
5......................................................................................................................................................14
Email.........................................................................................................................................14
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................16

INTRODUCTION
Financial reports are summary of all the financial transactions performed by a business
organisation within a specific time period (Lin and et.al, 2019). A company needs to prepare
several financial reports such as income statement, balance sheet, cash flow statements, etc.
These reports help the users in getting information regarding the financial transactions of the
business. In addition, financial reports also helps the users in analysing the actual financial
performance and position of the firm at a certain point of time. The present study shows
calculation of various calculations that have effect over the financial performance of the firm. It
shows preparation of journal entries for recording numerous financial transactions of the
company along with preparation of ledger accounts accordingly. In addition, the study also
shows calculation of deprecation and accumulated depreciation along with their journal entries
and preparation of several ledger accounts in the same context.
Further, the study also shows recording of various financial transactions in the books of
accounts and preparation of financial reports based on such transactions such as statement of
profit and loss accounts and balance sheet of the company.
TASK 2
Journal entries for recording purchase of assets, deprecation and accumulated deprecation for the
year ended 30 June 2016 and 2017.
Journal entries in the books of Andrew
Date Particulars Debit amount Credit amount
01/07/16 Mullum machinery account Dr. 18000
To bench planer account 18000
(Being bench planer purchased from Mullum
machinery)
01/07/16 Danny's drill account Dr. 5000
To standing drill account 5000
(Being Standing drill purchased from
Danny's drill)
30/06/17 Bench planer depreciation account Dr. 2720
Standing drill depreciation account Dr. 1050
To accumulated depreciation account 3770
(Being depreciation on bench planer and
standing drill charged and transferred to
accumulated deprecation account)
1

Workings
calculation of depreciation of bench planer
Particulars Amount
Cost 18000
Scrap value 1000
Expected production 5000
Life 2 years
Depreciation on the basis of units of production = original cost – scrap value / total
number of expected production * actual production
Particulars Working Value
Depreciation for the year
ended june 2016 18000-1000/5000*800 2720
Depreciation for the year
ended june 2016 18000-1000/5000*1000 3400
calculation of depreciation of standing drill
Particulars Amount
cost 5000
scrap value 800
life 4 years
Depreciation on the basis of straight line value method = original cost – scrap value / life of
assets
Particulars workings value
deprecation 5000-800/4 1050 per year
18. Preparation of asset registers
2

19. Preparation of rectification entries
statement showing rectifition entries
date particulars debit amount credit amount
A) Lennox Furniture account Dr. 3300
To Kingscliff Kitchens 3300
(Being rectification made for
amount wrongly entered in
Kingscliff kitchen's account)
B) Shaddy timber account Dr 8800
To purchase account 8800
(Being rectification made for
amount wrongly debited to
purchase account)
C) sales a/c 1210
To suspense 1210
(Being wrong positing in sales
account rectified)
D) Suspense a/c 30
to bank 30
(Being over addition of bank
adjusted)
20. Calculation of amount of debt and showing preparation of journal entries and ledger accounts
Date Particulars Debit amount Credit amount
1 Bad debts account Dr. 550
To domestic bliss account 550
2 Bad debts recovery account Dr. 550
To Bad debts 550
3 P & L Account Dr.\ 550
To bad debts recovery account 550
TASK 3
1. Preparation of deprecation worksheet
calculation of depreciation for truck 1
3

cost 33000
depreciation 30.00%
accumulated depreciation 15300
amount of depreciation
original cost * rate of
depreciation
particular calculation amount
depreciation for year 1 33000*30% 9900
depreciation for year 2 (33000-9900)*30% 6930
calculation of depreciation for truck 2
total cost of truck 2 52800
rate of depreciation 30.00%
amount of depreciation
original cost * rate of
depreciation
particular calculation amount
depreciation for year 1 52800*30% 15840
depreciation for year 2 52800-15840*30% 11088
2. Journal entries for depreciation on 30 june 2017
journal entries for
depreciation on assets
date particulars debit amount credit amount
30/06/19
depreciation account
Dr. 9900
to accumulated
depreciation 9900
3. Preparation of ledger accounts
accumulated depreciation for truck 1 account as on 30 June 2016
4

date particulars amount date particulars amount
by balance b/d 15300
to balance c/d 25200 by depreciation 9900
25200 25200
accumulated depreciation for truck 1 account as on 30 June 2017
date particulars amount date particulars amount
by balance b/d 25200
to truck 1
account 30397.5 by depreciation 5197.5
30397.5 30397.5
Old truck account as on 30 June 2016
date particulars amount date particulars amount
to bank 33000
By Truck 2
account 8800
to p & l 6197.5
By
accumulated
depreciation
for truck 1 30397.5
39197.5 39197.5
4. Preparation of income statement and balance sheet showing adjustments of depreciation
Preparing income statement showing extract of depreciation expense
particulars amount particulars Amount
depreciation expenses 21037.5 by truck 1 6197.5
Preparing balance sheet showing extract of depreciation expense
particulars amount
assets
Truck 2 52800
liabilities
accumulated depreciation 30397.5
5. Showing journal entries relating to disposal of old truck and purchase of new truck
5

journal entries for
disposing off truck 1
date particulars debit amount credit amount
Truck 2 Account Dr 52800
to bank 44000
to truck 1 8800
(being new truck
purchased by disposing
off new truck)
Truck 1 Account Dr 6197.5
To P &L 6197.5
(Being profit earned
from sale of truck)
TASK 4
1.
Journal entries
Journal for the year ended 30th june 2017
S.no. Particulars Debit ($) Credit ($)
1 Depreciation a/c Dr. 4500
To accumulated
Depreciation on
equipment a/c 4500
2 Depreciation a/c Dr. 5469
To accumulated
depreciation on vehicle
a/c 5469
3 Prepaid rates a/c Dr. 600
To rates a/c 600
4 Salaries a/c Dr. 3500
To Outstanding
salaries a/c 3500
5
Accrued Interest a/c
Dr. 1300
To Interest a/c 1300
6 Bad debts a/c Dr. 2600
To provision for
doubtful debts a/c 2600
7 Closing stock a/c Dr. 18800
To P&L a/c 18800
36769 36769
6

Ledger accounts
Ledger accounts
Depreciation
A/c
S.no. Particulars Amount S.no Particulars Amount
1
To equipment
a/c 4500
2 To vehicle a/c 5469
By closing bal. 9969
9969 9969
Accumulated
Depreciation
a/c on
equipment
S.no. Particulars Amount S.no Particulars Amount
By opening
bal. 10000
1
By
Depreciation
a/c 4500
To closing bal. 14500
14500 14500
Accumulated
depreciation
on Vehicle a/c
S.no. Particulars Amount S.no Particulars Amount
By opening
bal. 6250
2
By
Depreciation
a/c 5469
To closing bal. 11719
11719 11719
Prepaid rates
a/c
S.no. Particulars Amount S.no Particulars Amount
3 To rates a/c 600
By closing bal. 600
7

600 600
Rates A/c
S.no. Particulars Amount S.no Particulars Amount
To opening
bal. 1500
3
By advance
rates a/c 600
By closing bal. 900
1500 1500
Salaries A/c
S.no. Particulars Amount S.no Particulars Amount
To opening
bal. 30000
4 To cash a/c 3500
By closing bal. 33500
33500 33500
Outstanding
salaries a/c
S.no. Particulars Amount S.no Particulars Amount
4 By salaries a/c 3500
By closing bal. 3500
3500 3500
Accrued
Interest a/c
S.no. Particulars Amount S.no Particulars Amount
5 To Interest a/c 1300
By closing bal. 1300
1300 1300
Interest a/c
S.no. Particulars Amount S.no Particulars Amount
By opening
bal. 2000
5
By accrued
interest a/c 1300
To closing bal. 3300
3300 3300
Bad debts a/c
S.no. Particulars Amount S.no Particulars Amount
8

6
To provision
for bad and
doubtful debts 2600
By closing
balance a/c 2600
2600 2600
Provision for
bad and
dobutful debts
a/c
S.no. Particulars Amount S.no Particulars Amount
6
By bad debts
a/c 2600
To closing bal. 2600
2600 2600
2.
Email
To: Andrew
From: Financial Analyst
Date: July 15th, 2019
Subject: Details of the financial transaction
9

This is to inform you that the balance day transactions of your business has been recorded in the
journal, which is been called as the primary book and is prepared for detailing your company's
transactions with appropriate adjustments. The attached document will be facilitating all the
information regarding the transactions of your business.
Sincerely,
Financial Analyst
4.
a. Trial Balance
Trial balance as on 30th june 2017
Particulars Debit Credit
10