Report on Financial Accounting

Financial Accounting

Table of Contents
INTRODUCTION......................................................................................................................3
CLIENT 1...................................................................................................................................3
a. Doing Journal Entries in the books of Alex Study’s..........................................................3
b. Preparing ledgers account..................................................................................................5
c. Showing trial balance.........................................................................................................5
CLIENT 2...................................................................................................................................7
a. Preparing statement of profit and loss for Peter Piper........................................................7
b. Drafting statement of financial position for Peter Piper....................................................8
CLIENT 3...................................................................................................................................9
a. Showing profitability statement of Raintree Ltd..............................................................10
b. Preparing and presenting balance sheet of Raintree Ltd..................................................10
c. Defining the concept of consistency and prudent............................................................11
d. Stating the purpose of depreciation and illustrating two methods associated with it......12
CLIENT 4.................................................................................................................................13
a. Defining the purpose of bank reconciliation statement....................................................13
b. Presenting the reasons due to which balance of cash and pass book differs....................13
c. Preparing bank reconciliation statement..........................................................................13
CLIENT 5.................................................................................................................................14
a. Preparing purchase and sales ledger account for Henderson Ltd.....................................14
b. Defining the term of control account...............................................................................15
CLIENT 6.................................................................................................................................15
a. Presenting suspense account along with its main features...............................................15
b. Preparing trial balance by undertaking control a/c..........................................................15
c. Rectification of errors and journal entries based on it......................................................16
d. Stating the difference takes place between the suspense and clearing account...............17

CONCUSION..........................................................................................................................17
REFERENCES.........................................................................................................................19
APPENDIX..............................................................................................................................21
Appendix 1: Ledger account................................................................................................21

INTRODUCTION
Financial accounting is concerned with the preparation of highly appropriate
statement that furnishes information about the monetary position and performance.
Accounting tools and techniques are highly significant which in turn provides high level of
assistance to the business unit in preparing as well as presenting suitable view of monetary
performance. This report is drafted by addressing the different case situation which will shed
light on the manner through which adjusted profit& loss and balance sheet can be prepared.
Besides this, it will also develop understanding about the concepts of depreciation, suspense
and control account. Further, report will also highlight the way in which errors take place in
the accounting entries can be rectified. Thus, report will clearly present how trial balance
assists in preparing final accounts in an effectual way.
CLIENT 1
a. Doing Journal Entries in the books of Alex Study’s
Journal of Alex study for the month of May 2016
Particulars Debit Credit
1. Storage expenses a/c Dr.
To bank a/c
400
400
2. Purchase a/c Dr.
To S. Hood a/c
1450
1450
2. Purchase a/c Dr.
To D. Main a/c
2060
2060
2 Purchase a/c Dr.
To W. Tone a/c
960
960
2 Purchase a/c Dr.
To R. Foot a/c
1610
1610
3. J Wilson a/c Dr.
To sales a/c
1120
1120
3. T. Cole a/c Dr. 1640

To sales a/c 1640
3. F. Syme a/c Dr.
To sales a/c
2080
2080
3. J. Allen a/c Dr.
To sales a/c
910
910
3. P. White a/c Dr.
To sales a/c
2420
2420
3. F. Lane a/c Dr.
To sales a/c
770
770
4. Motor car expenses a/c Dr.
To cash a/c
470
470
7. Drawing a/c Dr.
To cash a/c
1500
1500
9. T. Cole a/c Dr.
J. Fox a/c Dr.
To sales a/c
680
1310
11. Sales return a/c Dr.
To J. Wilson
To F. Syme a/c
680
270
410
14 Van a/c Dr.
To Abel Motors Ltd
28500
28500
16 (a). Bank a/c Dr.
Discount allowed a/c Dr.
To P Mullen
(b)
Bank a/c Dr.
Discount allowed a/c Dr.
To F. Lane
(c)
Bank a/c Dr.
Discount allowed a/c Dr.
To J. Wilson
(d)
1330
70
2945
155
807.5
42.5
1400
3100
850

Bank a/c Dr.
Discount allowed a/c Dr.
To F. Syme
1586.5
83.5
1670
19 R. Foot a/c Dr.
To purchase return a/c
50
50
22 Purchase a/c Dr.
To L. Mole a/c
To W. Wright a/c
3740
1830
1910
24 a.
S. wood a/c Dr.
To Bank a/c
To Discount receive a/c
b.
J. Brown a/c Dr.
To Bank a/c
To Discount receive a/c
c.
R. Foot a/c Dr.
To Bank a/c
To Discount receive a/c
3600
4600
1400
3240
360
4140
460
140
1260
27 Salaries a/c Dr.
To bank a/c
4800
4800
30 Business rates a/c Dr
To bank a/c
1320
1320
31 Abel motors Ltd. a/c Dr.
To bank a/c
20500
20500
b. Preparing ledgers account
Ledger accounts present the summary of accounting transactions pertaining to the
specified time frame. By doing posting of accounting records or transactions business entity
can prepare ledger accounts and thereby would become able to draft trial balance.
Ledgers are enclosed in Appendix.