Recording Business Transaction

This report discusses the importance of recording business transactions and how it helps in decision-making. It covers the requirements of decision-makers, advantages and disadvantages of accounting, journal entries, general ledger examples, and the impact of COVID-19 on income statements. The report also provides insights into accounting concepts and recordkeeping.

Recording Business
Transaction.

Table of Contents
INTRODUCTION...........................................................................................................................3
PART 1............................................................................................................................................3
PART 2............................................................................................................................................5
PART 3............................................................................................................................................6
PART 4..........................................................................................................................................10
CONCLUSION..............................................................................................................................11
REFERENCE.................................................................................................................................13

INTRODUCTION
Accounting concept corresponds to tasks or methods for evaluating and analysing
quantifiable finance transaction records and introduces such financial insights for decision-
making to the decision of the organisation. Accounting is compatible approach as framework
within which financial statements of entity are described over a set period to acknowledge the
organisational productivity and economic position of that corporation and to reassess and convey
the same information to the intended users dealing is referred to accounting (Atrill and Lindley,
2019). The study report encompasses a range of notions pertaining to accounting and
recordkeeping of financial transactions. The report comprises of topics on organisational
decisions as well as the extent to which accounting information, skills and practical activities are
considered necessary to disclose on business events/transactions and develop financial annual
reports.
PART 1
Recognising decision-makers and describe their requirements with regard to accounting-
information:
Decision-makers are vital part of the organisation and involve individuals, primarily in
skilled management, that take important decisions and have an influence on the manner the
company works. Organizational workers who are good decision-makers understand ways to
tackle challenges quickly and use creative analysis to effectively address issues. They will easily
weigh the different choices and settle on the result that finest matches the company and its
managers (Marsidi, 2019).
Decision-makers preclude corporations from having impulsive decisions that disrupt
economic development. They are critical part of every organisation and optimise collaboration,
intellectual resources and organisational management. Effective decision resolve complex
challenges and choose the right solution that offers the longest-term advantages to their
company. In short, a prosperous decision could dramatically change a company. In any niche,
incorrect choices would have major implications for businesses. Efficient governance decision-
making helps companies to secure sales, build new opportunities, improve their advertising
processes and increase consciousness of their products. It is also useful for growth plans. At day-
ending the best decision-makers are ensuring business success. Decision-makers are usually
senior management personnel within a commercial enterprise, as that is case of Sainsbury plc the

world-wide UK oriented retail chain, executive board of which is entity's main decision-maker.
Sainsbury plc’s BOD have:
1. Chairman: Matin Scicluna
2. CEO: Simon Roberts
3. CFO: Kevin O Byrne
4. Non-executive Directors: Brian Cassin
5. Non-executive Director: Jo Harlow
6. Non-executive Director: Tanuj Kapilashrami, David Keens, Keith Weed
7. Senior Independent Director: Susan Rice
Decision makers employ accounting documentation and files to evaluate and ascertain the
enterprise 's management results and condition, to adopt critical actions and to introduce
appropriate policies to improve economic output in terms of sales, financial status of entity.
Another primary role of decision-maker is to set down policies and practices for the achievement
of organisational goals. To this effect, decision-makers use knowledge provided by the financial
and managerial processes of the enterprise. They requires financial insight into business revenue,
results and leverage losses for planning, monitoring and judgement. Decision-makers are
involved in choosing on the capacity of the society to make money. It is concerned for
determining the efficiency of the enterprise and fulfilling its financial commitments on schedule.
Various index, ratios such as debts-equity ratio, liquidity ratios etc (Galindo-Manrique, Pérez-
Calderón and Pache-Durán, 2020).
Financial reports represent all corporation accounting tasks in a snapshot which makes it
practical and easy for the management committee, along with general administrators, to use this
information in the deployment of policies. In which the annual reports are drawn up on the basis
of general practises and processes which are identical across the industry. This helps them to
separate them from several other players for placing themselves along market benchmarks. It
creates a management/BOD structure for decision-making on financial analysis, and whether
those decisions are beneficial and economically feasible for the company to take. In addition, all
estimates and forecasts are focused on financial details within the enterprise and on adjustments
in terms of market conditions. This is critical not only in the context of comparative study, as
well as in the context of the mechanism for gathering useful information via non-financial
information.

Advantages and disadvantages of accounting:
Advantages:
Thorough comparative study:
Accounting allows to compare timeline accounting records for prior years. Decision-makers may
also consider the structured documentation of all financial and accounting results in compliance
with corporate procedures.
Effective Decision makings
Decision making can be straightforward for management because there is a detailed accounting
of fiscal activities. Financial statements and benefit or loss render it more difficult for
administrators to plan, organise and organise procedures in various organisations. This provides
figures on cash inflows as well as outflows, also with earning and investing, which makes it easy
to quantify the deficit or surplus within reserves which should be handled in a reasonable time.
This also contributes to clarity and supervising of the preventive measures and consideration of
wrongdoing.
Disadvantage:
Cover only quantitative aspect
Non-fiscal events can impact the accounts-reports. Only accounts-transactions in the context of
finance may be determined by accounting professionals. Certainly, financial operations are
represented in terms of cash. This gives an inconsistent portrait during implementation
of legislations and also the implementation of essential business decisions. Throughout case of
two firms, the executives of the company cannot on basis of financial reports, make decisions
affecting other variables, such as federal, socioeconomic, educational as well as other
considerations (de Jong and Veld, 2020).
Biasness in Accounting-information
Professional accountants have a personal impact on the corporation's accounting statements.
Accounting staff can use different estimates of stock value, depreciation techniques,
classification of sales and capital expenditure, etc to calculate the business 's profits.
PART 2
A. Journal Entries of David for the month February 2020
Journal Entries
Date Particulars Dr. (£) Cr. (£)

01/02/20 Asma Ltd. A/c … Dr. 350
To office Fixtures A/c
(Being office fixtures returns to Asma
Ltd.)
350
04/02/20 Bad debt A/c...........Dr. 85
To S. Keyes 85
(Being bad debts written off from S.
Keyes)
09/02/20 Machinery A/c …......Dr. 2300
To TS Co. A/c 2100
To bank A/c 200
(Being Purchased a machine through TS
Co. to be used by the firm. The overall
purchase value of machine is £2,300. The
owner paid only 200 in form of a
cheque and the remainder of purchase
value will continue as credit)
13/02/20 Bank A/c …........Dr. 220
Bad Debt A/c..........Dr. 50
To S. Hill A/c 270
(Being £220 received from debtor S. Hill
and remaining 50 has been bad debt due
to bankruptcy)
20/02/20 Drawings A/c ….........Dr. 180
To purchase A/c 180
(Being amount withdraw to purchase
goods for owner’s personal use)
26/02/20 Drawing A/c..........Dr. 85
To insurance A/c 85
(Being personal insurance premium
debited to business books not stand
corrected)
28/02/20 TS company A/c …........Dr. 1050
To bank A/c 1050
(Being half payment of machinery paid by
owner to TS company)
PART 3
General Ledger of Pearce & Sons

Ledgers Accounts
(Amounts in GBP)
Date Particulars Amounts Date Details Amounts
01/02/20 By bank A/c 21500
01/02/20 By office
fixture A/c
800
01/02/20 By Van A/c 2500
29/02/20 To balance c/f 47300
Total 4300 Total 4300
Bank Account
Date Particulars Amounts Date Details Amounts
03/02/20 By cash A/c 1500 01/02/20 To capital A/c 21500
04/02/20 By Van A/c 4800 02/02/20 To Loan A/c 2500
19/02/20 By Nissan
company A/c
5200 25/02/20 To cash A/c 350
28/02/20 By balance c/f 12230
Total 24350 Total 24350
Van Account
Date Particulars Amounts Date Details Amounts
01/02/20 To capital A/c 2500
04/02/20 To bank A/c 4800
08/02/20 To Nissan
company A/c
5200

29/02/20 By balance c/f 35000
Total 35000 Total 35000
Quick office Ltd Account
Date Particulars Amounts Date Details Amounts
05/02/20 By office
fixture A/c
1100
29/02/20 To balance c/f 1100
Total 1100 Total 1100
Cash Account
Date Particulars Amounts Date Details Amounts
15/02/20 By Office
Fixture A/c
70 03/02/20 To bank A/c 1500
25/02/20 By bank A/c 350
29/02/20 By balance c/f 1080
Total 1500 Total 1500
Nissan company Account
Date Particulars Amounts Date Details Amounts
08/02/20 By van A/c 5200 19/02/20 To bank A/c 5200
Total 5200 Total 5200
Office Fixture Account
Date Particulars Amounts Date Details Amounts
01/02/20 To Capital A/c 800

05/02/20 To Quick
Office Ltd A/c
1100
15/02/20 To Cash A/c 70
28/02/20 To Bank A/c 620
29/02/20 By Balance c/f 2590
Total 2590 Total 2590
Loan Account
Date Particulars Amounts Date Details Amounts
02/02/20 By Bank A/c 2500
29/02/20 By Balance
c/f
2500
Total 2500 Total 2500
B. Balance up accounts and extract trail balance as at 30 February 2019.
Trial Balance (At month ending 29/02/20)
(Amount in GBP)
Details Debit Credit
Capital account 47300
Cash account 1080
Van account 35000
Bank account 12230
Quick office Ltd. Account 1100
Office fixture account 2590
Loan account 2500
Total 50900 50900

PART 4
Drafting income statement of Airman company year ending 30th Sept 2019:

Impacts of the COVID -19 pandemic on income statement.
For the sake of growth and advancement, businesses often need physical, social as well as
political stability. Instability resulting in decreased competitiveness and performance of the
Group, and even a spike in corporate deficits / failures, like Airman. For 10 years now they have
been financially and profitably liable and experience losses in the present year. When
recognising the ramifications of COVID-19, agency should classify as COVID-19 only
properties and loses which are vulnerable in market and even explicitly attributed to COV ID19.
If the epidemic of COVID-19 persists and is thus unable to recur until the symptoms have
completely diminished, sales and damages will not be increased or sustained. The recurring
profits and expenditure that could or couldn't be accumulated irrespective of COVID really aren't
gradual. The earnings or the expenditures allocated to COVID are not recognized and are not
reflected in sales. They are not classified as such (Krueger and Lelkes, 2019).
A decision would be crucial to determine the rate of increased income and expenses
specifically due to COVID-19 to degree that it'd be relevant for a conclusion to that effect and to
focus on specific facts and contexts. Certain revenue streams and expenditures could be more
precisely measured as regards the COVID-19 like additional hygienic sanitation expenditures
incurred for the diagnosis or elimination of contagious illnesses; temporary responsibility of
staff; penalties against non-performance of contractual agreements which lead to plant
dissolution; rental agreements negotiated by lease owners as a direct result.
The operations of airman company Covid-19 have been decreased to the first two quarters
from 19 Sep to 20 March, and are attributed to a limited timeframe between accounting phase
and the occurrence of the disease’s crisis. Post Mar20, it was acknowledged that each sector
experienced too many losses as a result of locked downs in area in terms of production,
distribution and selling, and Airman Sector still faced revenue fall in the value chain and a rise in
direct costs. Output has been reduced, which decreases market appetite for goods and the
business must also reimburse operating expense. This emphasis on company organisational
status and work has been examined as a result.
CONCLUSION
As per that report-study, accounting is significant component of a corporation which
helps it to handle financial results and make business decisions. The key aim of responsibility

knowledge is to facilitate decisions and meet established organisational priorities through
decision-makers.

REFERENCE
Books & Journals
Atrill, P. and Lindley, L. eds., 2019. Issues in Accounting and Finance. Routledge.
Marsidi, A., 2019. Sustainable supply chain management of Malaysian small business:
Accounting perspective. International Journal of Supply Chain Management, 8(4), pp.596-
600.
Galindo-Manrique, A.F., Pérez-Calderón, E. and Pache-Durán, M., 2020. Strategies for
Teaching Sustainability in Finance and Accounting: Challenges for Business Schools.
In Learning Styles and Strategies for Management Students (pp. 179-198). IGI Global.
de Jong, A. and Veld, C., 2020. Does the ABDC Journal Classification Create Unequal
Opportunities for Accounting and Finance Researchers?. Available at SSRN 3565550.
Krueger, T.M. and Lelkes, A.M.T., 2019. Bibliometric measures and journal characteristics of
leading accounting and finance journals. Journal of Accounting and Finance, 19(7).