Recording Business Transactions

Recording Business
Transactions

Table of Contents
ASSESSMENT 2.............................................................................................................................1
INTRODUCTION...........................................................................................................................1
PART A...........................................................................................................................................1
Journal transactions of T- accounts:............................................................................................1
Balance the accounts and an opening balances:..........................................................................2
Trial balance:...............................................................................................................................6
Income statement for the period 31st Oct. 2020:.........................................................................6
Preparation of financial position 31st Oct. 2020:........................................................................7
Letter to Linda..............................................................................................................................7
PART B............................................................................................................................................7
Ratio calculation for Linda's business:........................................................................................7
Analysis of the ratio in comparison to its competitor..................................................................9
CONCLUSION '..............................................................................................................................9
REFERENCES..............................................................................................................................10

ASSESSMENT 2
INTRODUCTION
Financial statements means records of the financial data which is written in the books of
accounts for measure the performance of the company. Financial information is used by the
investors and analyst to make predictions for the future direction and also used in evaluating of
the financial health and wealth of the company. It is the main source for the decision maker for
making decisions regarding the investing. In the financial statement there is the prepare of the
balance sheet, income statements and statement of cash flow in the given time period. In tis
assessment there is the record of the double entry transactions and evaluation of the statement of
financial position (Ghezzi and Cavallo, 2020). Apart from this there is the interpretation of ratio
analyses with their competitor and examine their performance.
PART A
Journal transactions of T- accounts:
JOURNAL ENTRIES
S.NO Date Particulars L.F £ £
2020
1 1'Oct Cash A/c..... Dr. 5,200
Bank A/c ..... Dr. 8,000
Van A/c ..... Dr. 3,000
To Capital A/c...... 16,200
( Being Capital invest into business)
2 2'Oct Laptop A/c... Dr. 1,000
To Bank A/c.... 1,000
( Being Purchase laptop by cheque)
3 4'Oct Purchase A/c .... Dr. 2,450
To Toys LTD. A/c......... 2,450
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( Being goods purchased on Credit
basis)
4 5'Oct Bank A/c... Dr. 1,500
To Sales A/c........ 1,500
(Being goods sold by cheque)
5 12'Oct Repair A/c..... Dr. 80
To Cash A/c..... 80
( Being Repair laptop with cash)
6 18'Oct Toys LTD. A/c... Dr. 100
To Purchase Return A/c..... 100
(Being purchase Return made)
7 21'Oct Bank A/c... Dr. 500
To rent A/c...... 500
(Being Rent received in cash)
8 23'Oct Fred A/c .. Dr. 400
Cash A/c ..... Dr. 1,500
To Sales A/c......... 1,900
(Being Goods sold in cash )
9 23'Oct Cash A/c Dr. 500
To Sales A/c 500
(Being Goods sold)
10 24'Oct Car A/c Dr. 2,500
To Bank A/c 2,500
(Being Car purchased in car)
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