Recording Business - Portfolio 1

This report covers the process of starting a new business enterprise as a decorator, decision makers in a London Stock Exchange listed company, and financial record keeping through journal entries, general ledger, and trial balance. It also predicts the profit/loss for 2022 based on previous year's income statement. The report concludes with the importance of key stakeholders in a business organization.

Recording Business
Transactions
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Table of Contents
Introduction......................................................................................................................................3
PART – A........................................................................................................................................3
(1) Process for starting a new business enterprise as a Decorator..............................................3
(2) Identify the decision makers of the business organization which are responsible for the
process of the decision making in context to the company listed on the London Stock
Exchange.....................................................................................................................................4
Part – B............................................................................................................................................5
(a) Journal Entries for the month September, 2021....................................................................5
Part – 4.............................................................................................................................................8
(a)Income Statement of P Moore ending 31st September, 2021................................................8
(b) Based on the income statements of previous year predict that whether the company will
attain profits or losses in the year 2022.......................................................................................9
Conclusion.....................................................................................................................................10
References......................................................................................................................................11
Books & Journals......................................................................................................................11
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Introduction
It is highly important for any organization to record all the business financial transactions
in a proper way so that the organization can keep a check on the financial performance of the
business related functions. When the records are maintained in a proper way so that the financial
decisions can be taken effectively without any kind of inefficiency. In context to this report, the
process to start a business is described with step by step procedure. Also, financial journals,
ledgers and trail balances are prepared to record the business transactions. In addition to this
financial performance is assessed based on the interference of the global pandemic corona virus.
PART – A
(1) Process for starting a new business enterprise as a Decorator.
Sole Business organization can be referred as a business organization essentially involving a
single natural person responsible for managing the entire business (Pratama, 2017).
Therefore, the process of establishing a business organization is described below as a
decorator:
• Idea generation: The first step before starting a business organization is that it must have
an idea, based on which the whole company will work. Being a decorator, the owner must
specifically determine and analyze what novelties can be offered to the target market so that
they can be strongly attracted to the business. Therefore, the idea of originality as well as the
quality of the work can help in creating a competitive advantage among competitors.
• Funding Proposal: The second and also one of the most important steps is a financial
institution because it is very important for a business that they have enough capital for the
business to run smoothly. Owners must find genuine and reliable sources of capital so that
they can invest effectively in the business to achieve a sound financial position.
• Location of the company: It is very important for any company to establish its
organization as the most suitable places to attract and attract large amount of customers on a
daily basis. In return for the activity of a Decorator will be proposed to carry out commercial
activities in major cities. The main reason behind this is that opportunities for business
organization like event decoration are more abundant and it is relatively easier for the
business to thrive and be successful in the long run.
• Human Resource Selection: To run a successful business organization, it is very
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important that the organization has an efficient and effective workforce to help the
organization manage its business (Negash and Lemma, 2020). themselves in the most
appropriate way. In the decoration business landscape, it is necessary to have a workforce
with the features of creativity, hard work and a high level of commitment to succeed in a
more consistent manner.
• Tax planning: Taxes are something that can consume a business' profits and lead to a
reduction in the amount of money in the hands of the owner. Therefore, for the respective
company, we recommend it to do effective tax planning to reduce the tax liability of a
particular financial year.
• Opening the business enterprise: Once all of the above steps have been fully completed, it's
time to launch the business (Alsharari, 2017). In the business context of Decorator, after
completing all the above mentioned processes, steps and procedures, the business can
effectively market with the goal of success as well as huge long-term profits.
(2) Identify the decision makers of the business organization which are responsible for the
process of the decision making in context to the company listed on the London Stock Exchange.
Decision makers can be defined as the people in the business who have the authority and power
to make different types of strategic and important decisions. These decisions may involve
acquisitions, mergers or expansions (Abdurrahman, 2019) . In the context of Unilever,
which is considered as one of the leading companies on the London Stock Exchange,
various decision makers are also involved in the decision-making process for all matters
related to the business. business. The different decision-makers are explained below by
their respective organizations:
• Business leaders: Business managers play an important role in the preparation of action
plans that greatly contribute to achieving achieve business goals in the most effective
way. In the context of Unilever, managers always ensure that all employees in the
company are working efficiently and implementing all the strategies designed by the
manager.
• Investors: They are the most important decision makers in the company. The main
reason behind this is that they are the ones who help increase shareholder value, reduce
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capital costs and build effective reputation in the investment community over a long
period of time. In the context of the respective business, the investors are solely
responsible for making decisions in the various affairs of the business so that the business
can operate efficiently.
• Analysts: They are advocates of a proactive approach before dealing with a particular type
of situation in a very smart way. In Unilever's context, they have a team of analysts majorly
engaged in the process of reviewing information from financial data to take action
(Alkiviadis, Grigorios and Nikolaos, 2020) . In addition, they have great skills to handle
business activities and are most likely to operate all steps in the process of decision-making.
Part – B
(a) Journal Entries for the month September, 2021
Date Particulars Debit
Amount
Credit Amount
01/09/2021 Bad Debts A/C Dr.
To P Mullen A/C Cr
(Being debts written off)
105
105
05/09/21 Syme Ltd A/C Dr.
To Office Fixtures A/C Cr.
(being office fixtures returned)
150
150
10/09/21 Cash or bank A/C Dr.
Bad Debts A/C Dr.
To M Abel A/C
(being amount recovered in the full settlement)
180
131
311
18/09/21 Machinery A/C Dr.
To cash A/C cr.
To bank A/C Cr.
To Brown Ltd A/C Cr.
(Being machinery purchased by cash, bank and on
credit)
1800
100
500
1200
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26/09/21 Brown Ltd A/C Dr.
To Bank A/C Cr.
(being half amount paid to Brown Ltd)
600
600
28/09/21 Insurance A/C Dr.
Drawings A/C Dr.
To Bank A/C Cr.
(Being insurance paid)
60
70
130
2. Record the General Ledger and Trial Balance of the Maurice and brothers.
a) GENERAL LEDGER – MAURICE BROTHERS
Cash Account
Date Particulars Ref Amount Date Particulars Ref Amount
03/08/21 Bank 2800 15/08/21 Office Fixtures 110
19/08/21 Toyota Co. 8700
31/08/21 Balance c/d 6440 25/08/21 Bank 430
9240 9240
Bank Account
Date Particulars Ref Amount Date Particulars Ref Amount
03/08/21 Cash 2800
01/08/21 Capital 36800 04/08/21 Van 6200
25/08/21 Cash 430 05/08/21 Office Fixtures 1000
02/08/21 Loan Payable 12400 28/08/21 Office Fixtures 750
31/08/21 Balance c/d 38880
49630 49630
Van Account
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Date Particulars Ref Amount Date Particulars Ref 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
Office Fixtures
Date Particulars Ref Amount Date Particulars Ref Amount
01/08/21 Capital 1200
05/08/21 Bank 1000
05/08/21 Sharp Office Ltd 2400 31/08/21 Balance c/d 5460
15/08/21 Cash 110
28/08/21 Bank 750
5460 5460
Sharp Office (Creditor)
Date Particulars Ref Amount Date Particulars Ref Amount
31/08/21 Balance c/d 2400 05/08/21 Office Fixtures 2400
2400 2400
Toyota Co. Accountable
Date Particulars Ref Amount Date Particulars Ref Amount
19/08/21 Cash 8700 08/08/21 Van 8700
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8700 8700
Loan Payable Account
Date Particulars Ref Amount Date Particulars Ref Amount
31/08/21 Balance c/d 12400 02/08/21 Bank 12400
12400 12400
Capital Account
Date Particulars Ref Amount Date Particulars Ref Amount
31/08/21 Office Fixtures 1200
31/08/21 Van 32000 31/08/21 Balance c/d 70000
31/08/21 Bank 36800
70000 70000
b) TRIAL BALANCE
TRIAL BALANCE
Maurice & Brothers
Debit Credit
Bank 38880
Cash 6440
Van 46900
Office Fixtures 5460
Sharp Office Ltd (Creditor) 2400
Loan Payable 12400
Capital 70000
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TOTAL 91240 91240
3. Prepare income Statement and analyse why the profit has increased and decreased over the
years.
a) Income Statement – B Moore
Particulars Amount (£)
Sales 95000
Less: Sales Returns 3500
Less: Carriage Inwards 890
Net Sales 90610
Opening Stock 18000
Purchases 110000
Less: Return Outwards 720
Less: Closing Stock 13000
Net Purchases 114280
Motor Expenses 1400
Rent 7000
Telephone Charges 830
Wages and Salaries 14000
Insurance 1030
Office Expenses 800
Sundry Expenses 250
Operating Expenses 25310
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TOTALS -48980
(b) Based on the income statements of previous year predict that whether the company will
attain profits or losses in the year 2022.
From the above data on B Moore's financial statements, it can be seen that the business
organization has suffered a heavy loss since 2020. The new type of corona virus has
seriously affected the business organization, its impact can be severe. can be clearly seen in
2020 with a heavy loss of 6500, and for 2021 the company is still facing a large loss, as
shown in the above profit and loss account of the company. But by 2022, the situation would
have improved if the company adapts to the new and different changes in the market during
the post-covid period (Nasr and Ntim, 2018). Situations may return to normal, which will
keep the business organization on track with high sales volume and increase company
profits. Once the market situation is normalized, it will automatically have a positive impact
on the company's operations and operations. Therefore, it is expected that B Moore's
business will return to stability and profitability by 2022.
Conclusion
From the above report, it can be concluded that in order to fix a business strategy, it is crucial to
implement while starting a business. The preparation of journal accounts, general ledger and
trial balance account discloses the company's financial position. In this report, Unilever is
taken and the decision-makers of the organisation is explained which helped in
understanding the importance of key stakeholders in the business organization.
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References
Books & Journals
Pratama, A., 2017. Why do accounting students choose a career in accountancy? An exploratory
study in Bandung City, West Java, Indonesia. Review of Integrative Business and Economics
Research, 6(2), p.393.
Negash, M. and Lemma, T. T., 2020. Institutional pressures and the accounting and reporting of
environmental liabilities. Business Strategy and the Environment, 29(5), pp.1941-1960.
Alsharari, N. M., 2017. The development of accounting education and practice in an
environment of socio-economic transformation in the Middle East: the case of
Jordan. International Journal of Educational Management.
Abdurrahman, A., 2019. Impact of Green Accounting on Company Value: Evidence from the
Nigerian Companies. Arthatama, 3(1), pp.16-26.
Alkiviadis, K., Grigorios, L. and Nikolaos, L., 2020. Taxation efficiency and accounting assisted
transparency, insight into a European framework. Journal of Accounting and
Taxation, 12(1), pp.28-38.
Nasr, M. A. and Ntim, C. G., 2018. Corporate governance mechanisms and accounting
conservatism: evidence from Egypt. Corporate Governance: The International Journal of
Business in Society.
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