Financial Accounting: Types of Company Operations, Single Entry vs Double Entry Bookkeeping, Trial Balance and Ledger Accounts

Financial Accounting

Table of Contents
INTRODUCTION...........................................................................................................................3
SCENARIO 1..................................................................................................................................3
Question 1...................................................................................................................................3
Question 2...................................................................................................................................5
Question 3.................................................................................................................................11
Question 4.................................................................................................................................12
SCENARIO 2................................................................................................................................13
Question 1.................................................................................................................................13
Question 2.................................................................................................................................14
Question 3.................................................................................................................................15
Question 4.................................................................................................................................15
Question 5.................................................................................................................................17
CONCLUSION..............................................................................................................................18
REFERENCES..............................................................................................................................20

INTRODUCTION
Financial accounting seems to be the process of recording, evaluating, and reporting
financial transactions and occurrences which are at some largely financial in character, as well as
interpreting the outcomes in a meaningful way. Financial accounting is really a professional
sector of accounting which measures cash flow inside a corporation (Aifuwa, Embele and Saidu,
2018). Expenses are recorded, summarised, and income tax as well as financial statements, such
as with a cash flow report or a balance sheet, are prepared according to predefined rules. The
many chores of recording company activity in the form of documents, reports, trial balances, as
well as the development of yearly reports for business entities determine this assessment.This
research also included a bank examination to see if the financial records were accurate.
SCENARIO 1
Question 1
Various types of company operations have been documented in accounting records, and the
amount from which it is founded was further defined. The following are some of them:
1. Sales transactions entail the selling of a commodity to a consumer in exchange for money
or credit.
2. Acquisitions are the events that somehow a business employs to acquire the items or
resources necessary to achieve the company's goals, as well as they are a negative to cash
or receivable accounts as well as a crediting to the revenue connected accounts
throughout the sales data.
3. Money purchases resulting in such a debit throughout the financial statements as well as a
problem of financial. Unless the products were purchased on credit, the purchase will be
completed, the debit accrued income, as well as the reimbursements put into the chaining
accounts.
4. Accounts receivable were documentation that show that a firm has paid for the delivery
of the product to some other firm. The invoicing interchange is recorded in the merchant's
reporting as a cash debit balances to the prepayments.
5. Payment comprise transactions in which monies are sent to a firm that is getting funds in
exchange for goods or services. Persons are recorded in the company's accounting log,

allowing the transaction to be recorded as a sum received as well as a decrease from
accounts receivable.
Single entry bookkeeping
Single-entry accounting is unlikely to work for a business even if it is small, simple, and
has a low volume of transactions. It's typically similar to having your own private account. When
you use single-entry accountancy, you may keep track of things like money, income expenses,
and taxable income(Bishop, DeZoort and Hermanson, 2017).
Double entry bookkeeping
Many businesses, particularly start-ups, use double-entry accounting to maintain track of
their finances. The fact that each checkbook contains two sections yet expenditures are on
opposite sides is one of the hallmarks of double accounting system. The payment generates two
transfers: one deduction through one bank or each crediting from another (Ayres, Huang and
Myring, 2017).
Trial balance and its importance
The trial balance is really a spreadsheet where all accounting balances are incorporated
further into contactless payment component amounts, and the total is balanced. The business
used to make preparations trial balances on a regular basis, generally at the conclusion of each
financial month. The following are the doctoral programs of the financial statement:
Checking for reliability: This might indicate that the settlement agreement was being utilised
to validate the real figure gathered on the proper side of that equation ledger when transferring
data from many other sources like purchase records, written documents, cash books, and so on.
Aside from financial accounting considerations, the legitimacy of a specific economic industry
by improving.
Aids in the preparation of financial reports: The financial statements, capital structure, and
capital expenditures must all be revised at the conclusion of each financial reporting year. The
trial chapter also covers the total amount of all monies utilised to compile the accounting
statements, making financial facts simple to produce and comprehend.
Rectifying errors: The total deficit of both financial statements must match the total credit
including its financial statement. It is really a examination of the had therefore in the pamphlet. If
this isn't the case, the auditor will catch the mistake and correct it. Accounting professionals are
also happy when the overall debt balance as well as the overall amount owing are equal.

Adjustment assistance: During the verdict balance building process, adjustments programs
including such payroll costs, retention bonds, closure needs to share, and so on must be altered.
This helps make modifications that are only noticeable in the relevant accounting year. There at
conclusion of the fiscal year, companies typically throw out readjustment news pieces. When
people occurs, there really is no constraint on initiating new shift activities (Bolvar and et al,
2018).
Question 2
A journal entries is a form of financial entry that is used to record a business transaction in a
company's accounting records. A written request is normally recorded inside the accounting
information system; however, it can also be recorded inside a different fund, which would be
summed and inserted into the financial accounts. It creates financial statements and for
organisation using account balances. The overarching rules for a personal journal are that it must
include at least two spending programs but that the exact figure entered in the trail balance is
equivalent to the total attempted throughout the credit side.
Date Particulars Debit Credit
01-Jun Cash a/c Dr. 65000
To capital a/c 65000
(Being invest cash into
business)
02-Jun Purchase a/c Dr. 8000
To creditor a/c 8000
(Being purchase goods on
credit)
07-Jun Cash a/c Dr. 4000
To sales a/c 4000
(Being sell out inventory in
cash)
08-Jun Creditor a/c Dr. 4000
To Bank a/c 4000
(Being issue cheque for
purchase credit goods)

14-Jun Insurance a/c Dr. 75
To Bank a/c 75
(Being pay insurance amount
by cheque)
15-Jun Debtor a/c Dr. 12000
To Sales a/c 12000
(Being sell out inventory on
credit)
16-Jun Purchase a/c Dr. 10000
To Creditor a/c 10000
(Being purchase goods on
credit)
18-Jun Computer equipment a/c Dr. 3000
To Cash a/c 3000
(Being purchase computer
equipment)
20-Jun Rent a/c Dr. 150
To bank a/c 150
(Being paid rent by cheque)
21-Jun Cash a/c Dr. 10000
To sales a/c 10000
(Being sale inventory in cash)
25-Jun Cash a/c Dr. 100
To bank a/c 100
(Being withdraw amount from
bank)
30-Jun Stationary a/c Dr. 30