Recording Business Transaction: Journal, Ledgers, Trial Balance, Income Statement, Balance Sheet

RECORDING BUSINESS
TRANSACTION

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
PART A...........................................................................................................................................3
A. JOURNAL..............................................................................................................................3
B. LEDGERS...............................................................................................................................5
C. TRIAL BALANCE.................................................................................................................8
D.INCOME STATEMENT.........................................................................................................9
E. BALANCE SHEET.................................................................................................................9
F. BRIEF ON LINDA'S DRAWINGS......................................................................................10
PART B..........................................................................................................................................10
INTERPRETATION..................................................................................................................11
CONCLUSION..............................................................................................................................13
REFERENCES................................................................................................................................1

INTRODUCTION
The Recording of business transaction records all the transactions in the books of
accounts of any organization in many ways. These transactions are recorded in Journal entries,
Profit and Loss Statement, income statement and balance sheet of the firms (Rechtman, 2017). In
this report Linda started new business of selling toys in Oxford university and record the
transactions' for the first month. It also analysis the ratios of the company and interpretation
which shows the company efficiency and working of business. Whereas, Ratios are also
compared with the competitor market and shows Linda's business position in the market.
MAIN BODY.
PART A
A. JOURNAL
Dt. Transactions Dr. Cr.
01/10/20
Bank A/C................. Dr
To capital A/C..... Cr. £8,000 £8,000
Cash A/C................. Dr
To capital A/C...... Cr £5,200 £5,200
Van A/C................. Dr
To capital account...... Cr £3,000 £3,000
02/10/20
Laptop A/C................ Dr
To Bank A/C..... Cr
(Buying of laptop for Business use) £1,000 £1,000
04/10/20
Purchase A/C................ Dr
To Toys Ltd. A/C...... Cr.
(Credit Purchase of Goods) £2,450 £2,450
05/10/20
Bank A/C................ Dr
To Sales A/C...... Cr.
(cash sales of goods) £1,500 £1,500
12/10/20
Repairs A/C................ Dr
To Cash A/C...... Cr.
(Repaired laptop and paid in cash) £80 £80
18/10/20 Toys Ltd. A/C................ Dr £100 £100

To Purchase A/C...... Cr.
(Return of goods to Toys Ltd.)
21/10/20
Bank A/C ................ Dr
To Rent received A/C...... Cr.
(Rent Received) £500 £500
23/10/20
Cash A/C................ Dr
To Sales A/C...... Cr.
(Goods sold on cash) £1,500 £1,500
Fred A/C................ Dr
To Sales A/C...... Cr.
(Goods sold on Credit) £400 £400
23/10/20
Cash A/C ................ Dr
To Sales A/C...... Cr.
(Cash sales) £500 £500
24/10/20
Old car A/C................ Dr
To Bank A...... Cr.
(Second hand car purchase in auction) £2,500 £2,500
26/10/20
Wages A/C................ Dr
To Bank A/C...... Cr.
(Wages paid to Shopkeepers) £820 £820
30/10/20
Rent A/C................ Dr
To Bank A/C...... Cr.
(Business Rent paid) £1,000 £1,000
31/10/20
Drawings A/C................ Dr. *
To Bank A/C...... Cr.
(Drawing from bank) £1,600 £1,600
Total £30,150 £30,150
*Note: