Steps to Start a New Business as a Decorator and Decision Makers of a Company Listed on London Stock Exchange

This report discusses the steps required to start a new business as a decorator and identifies the decision makers of a company listed on London Stock Exchange. It also includes journal preparation, ledger and trial balance preparation, and income statement preparation for different businesses.

ASSESSMENT PART A, B
AND C

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
PART A...........................................................................................................................................3
Identify the steps required to start a new business as decorator.................................................3
Identify the decision makers of a company listed under London stock exchange......................4
PART – B: 1.....................................................................................................................................6
PART – B: 2.....................................................................................................................................7
PART C..........................................................................................................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Business transactions refers to all the dealing of business that takes place or will happen
in future in the form of money in between two or more persons. All these entries are to be
recorded in the books of accounts which are then posted into ledgers and then final accounts are
prepared (García, 2020). The assessment consists of three parts, wherein Part A consists of
discussion pertaining to steps needed to be performed while starting a new business as a
decorator. Also, This part provides the steps for opening of new business along with identifying
the decision makers in a big firm listed on London Stock Exchange. In part B, journal will be
prepared for F Folk which is a bakery business for the month of September, 2021 to guide the
owner in how to treat various business transaction of which he has no surety. At last, in part C,
the ledger and trial balance will be prepared for ABC Enterprise and Income statement will be
prepared for B Moore for the year ending 30th September 2021 to predict where the loss / profit
will be increase or decrease in the year 2022.
PART A
Identify the steps required to start a new business as decorator.
David is operating its business as a sole trader and is desiring to begin a firm of decorator
but is unaware about the steps involved in its opening. For stating any business, it is very
important to fulfil all the obligations required for its incorporation. Here is the procedure that
David would have to follow to operate as a proprietor.
 Frame a model - At very first, a model is prepared for the organisation that will help I
ascertaining all the activities that would be required for operating the company and will
also assist in lining up all the actions.
 Creation of model- After that a proper framework is prepared with the help of strategies
which can help in determining the goals and vision of the firm. Here, David is required to
consider all the benefits and disadvantages of the business of decoration according the
realities of market and also have to make a plan about the need of capital and its source of
arrangement (Morgan, 2019).
 Preparation of portfolio- the next important step Is to make a leaflet or a brochure that
will be used to spread the information about business to public. In this, all the details of

the company are mentioned whether its is vision, mission, reach, workings and
proficiency.
 Setting a list of required materials- David after making a portfolio has to prepare a list
of material that would be required for carrying the operations as a decorator such as
designer panels, curtains, balloons, lights, wraps, hangings and many more.
 Prepare a guide- it is important for a business to decode its long as well as short term
objectives. This will guide it in moving towards its operations smoothly. Through this,
they can even analyse the problems that can occur in future so that solutions can be
recognised for them in advance.
 Make presence on Social media- Today, people prefer to check out decoration ideas on
online sources. Thus, it is very important for David to create its social media accounts
such as Facebook, Instagram, you tube etc. This will help it in showcasing its ideas to
more people and will also help it in attracting customers towards it (Pankl, 2017).
 Formulating network- After this, David is required to create a network which will help
it in creating a link and availing customers. Through this, it can also create a link with
those persons that can help it in carrying its work of decoration.
Identify the decision makers of a company listed under London stock exchange.
Bookkeeping can be defined as a concept of recording, analysing, interpreting and
communicating the whole accounting data sop that it can be used in making various financial
decisions. Its main aim is to provide complete information to the different stakeholders of the
company. Marks and Spencer is a big fashion store listed on the London Stock Exchange. It has
number of stakeholders which makes use of these summarized statements for taking various
decisions. They keep a watch at the financial; records of these statements. Here are some of the
decision makers who make their decisions with the help of these reports.
Users of Accounting Information for taking business decisions:
 Investors- these persons are interested in the profits of Marks and Spencer. On the basis
of this, they decide that whether the firm should make investment with that firm or not.
They continuously look at the well being of the company and keep comparing it with
competing businesses.
 Government- they look after the legal and accounting obligations addressed by firm .
They are interested in knowing that whether the organisation is paying its tax properly or

not, also, they wants to know that whether the firm is following all the rules and
regulations of accounting or not (Tukker and Tischner, 2017).
 Management- these are the main decision makers who makes decisions for the
betterment of the business. They frames plans for controlling costs and increase profits on
the basis of these statements.

PART – B: 1
Journal of
______F Folk___
for the month
__of September
2021______
Date Details Fol DT £ CT £
01/09/21 Bad debts account dr. 105
To P Mullen account 105
(Being P Mullen written off as bad debts.)
September 5
2021
Cash account dr. 150
To Office Fixtures account 150
(Being office furniture returned to supplier)
10/09/21 Cash account dr. 180
Bad debts account Dr. 131
To M. Abel 311
(Being outstanding amount received from
debtor in full and final settlement of the debt)
18/09/21 Machinery account dr. 1800
To cash account 100
To Bank account 500
To Brown Ltd. 1200
(Being machinery purchased of which 1/3
payment has been done through cash and bank,
remaining amount is outstanding)
26/09/21 Brown Ltd. Account Dr. 600
To Bank account
(Being half of the outstanding amount paid to
Brown Ltd. 1200 * 1 / 2 = 600)
600
28/09/21 Insurance expenses dr. 130
To Bank account 130
(Being insurance bill paid through cheque)
September
31 2021
Drawings account dr. 70
To insurance expenses 70

PART – B: 2
a)
LEDGER OF ____________ABC Enterprise, Maurice & Brothers_____________FOR
__________August 2021_______(month)
Bank Account
Date Details Fol Amount
in £
Date Details Fol Amount in
£
01/0
8/21
To Balance brought
forward
36800 03/0
8/21
By Cash Account 2800
02/0
8/21
To Santander Bank 12400 04/0
8/21
By second - hand Van
Account
6200
25/0
8/21
To Cash In hand
account
430 05/0
8/21
By Office Fixtures
account
1000
19/0
8/21
By Toyota Co. 8700
28/0
8/21
By Office Fixtures
Account
750
31/0
8/21
By Balance carry
forward
30180
01/0
9/21
To Balance Brought
forward
30180
Cash In hand Account
Date Details Fol Amount
in £
Date Details Fol Amount in
£
03/0
8/21
To Bank account 2800 15/0
8/21
By Office Fixtures
Account
110
25/0
8/21
By Bank account 430
31/0
8/21
By Balance carry
forward
2260
01/0
9/21
To Balance Brought
forward
2260
Santander Bank Account
Date Details Fol Amount
in £
Date Details Fol Amount in
£

31/0
8/21
By Balance Carry
forward
12400 03/0
8/21
By Bank Account 12400
01/0
9/21
By Balance Brought
forward
12400
Van Account
Date Details Fol Amount
in £
Date Details Fol Amount in
£
01/0
8/21
To Balance Brought
forward
32000
04/0
8/21
To Bank Account 6200
08/0
8/21
To Toyota Co. 8700 31/0
8/21
By Balance carry
forward
46900
01/0
9/21
To Balance Brought
forward
46900
Office Fixtures Account
Date Details Fol Amount
in £
Date Details Fol Amount in
£
01/0
8/21
To Balance brought
forward
1200
05/0
8/21
To Bank account 1000
05/0
8/21
To Sharp Office Ltd. 2400
15/0
8/21
To Cash In hand
account
110
28/0
8/21
To Bank Account 750 31/0
8/21
By Balance carry
forward
5460
01/0
9/21
To Balance Brought
forward
5460

Sharp Office Ltd. Account
Date Details Fol Amount
in £
Date Details Fol Amount in
£
31/0
8/21
To Balance Carry
Forward
2400 05/0
8/21
To Office Fixtures 2400
01/0
9/21
To Balance brought
forward
2400
Toyota Co. Account
Date Details Fol Amount
in £
Date Details Fol Amount in
£
19/0
8/21
To Bank account 8700 01/0
8/21
By Van Account 8700

Trial Balance of ________ABC Enterprise, Maurice & brothers,_______________ as at
______________________31st August 2021_______________
Details Debit £ Credit £
Bank Account 30180
Cash In hand Account 2260
Santander Bank Account 12400
Van Account 46900
Office Fixture Account 5460
Sharp Office Ltd. Account 2400
Capital Account 70000
TOTAL 84800 84800

PART C
Income Statement of ________________B Moore_______for the
year_________________Ended 30th September 2021___________
Details Amount in
£
Amount in
£
Sales Revenue
Sales 95000
Less: Sales Return -3500
Net Sales 91500
COGS: Cost of goods sold
Opening Inventory 18000
Add: Purchase
Less: Purchase Return
Net Purchases
110000
-720
109280
Add: Carriage Inward (Direct Expenses) 890
128170
Less: Closing Inventory -13000 -115170
Gross Loss -23670
Less: Operating Expenses
Motor Expenses 1400
Rent 7000
Telephone charges 830
Wages and Salaries 14000
Office Expenses 800
Carriage Outwards 500
Total Administrative Expenses -24530
Operating Loss -48200
Less: Non – Operating Expenses
Insurance 1030
Sundry Expenses 250
Total Non – Operating Expenses -1280
Net Loss -49480
b.
Year 2013 2014 2015 2016 2017 2018 2019 2020 2021
Profit /
Loss
55800 77100 85500 98400 87600 97200 112400 -65400 -49480

b. In the year 2021, again there is a loss of 49480 due to the low confidence prevailing
among the market participants with the emergence of Covid – 19 pandemic. Accordingly, it can
be predicted for the year 2020 that there would be a trend of loss itself as the market still has not
recovered completely from the shock of Covid – 19 pandemic (Devi and et.al., 2020). With this
reason, customer's buying behaviour has changed drastically, and they are preferring to make
purchases or spend their existing purchasing power over their necessities only and postponing
their extra and additional purchases of those products and services which are meant for luxurious
purposes. However, it can be said that the loss amount would get reduced as compared to the loss
of 49480 in the year 2021 due to the reason that market is recovering from the shock of
pandemic Covid – 19 (Amnim, Aipma and Obiora Fabian, 2021). Also, if in case this business
concern will move on the positive side that is, will start earning profit then also they will be
below the level as the business has achieved in the year 2019 which is the highest of all years
from 2013 to 2021.
CONCLUSION
From the above report it can be analysed that organisations should take their decisions of
starting a new business with due diligence. They should consider and follow all the rules and
regulations that are required to start the firm. Also, they took keep in mind that the accounts
prepared by them should be formulated properly as various stakeholders frame their decision on
the basis of these statements only. Also, financial information that can be obtaining through
performing accounting for a business provides assistance in making business decisions
appropriately. Further, with the adoption of double entry system, assurance can be given for the
accuracy of books of accounts due to having a credit for every debit. At last, prediction has been
done for the year 2022 with regard to whether there will be increase or decrease in the loss or
profit of the business of B Moore by considering the current market scenario prevailing in its
business environment.

REFERENCES
Books and Journals
Amnim, O. E. L., Aipma, O. P. C. and Obiora Fabian, C., 2021. Impact of covid-19 pandemic on
liquidity and profitability of firms in Nigeria. Social Sciences, 11(3), pp.1331-1344.
Devi, S., and et.al., 2020. The impact of COVID-19 pandemic on the financial performance of
firms on the Indonesia stock exchange. Journal of Economics, Business, & Accountancy
Ventura, 23(2), pp.226-242.
García, M.M., 2020. Starting with Microservices. In Learn Microservices with Spring Boot (pp.
149-214). Apress, Berkeley, CA.
Morgan, B., 2019. Starting from Scratch. Iowa Review. 49(3). pp.84-183.
Pankl, R.R., 2017. Using the resources of the public library in market planning in starting a
business: A hypothetical case. Journal of Business & Finance Librarianship. 22(1).
pp.1-6.
Tukker, A. and Tischner, U. eds., 2017. New business for old Europe: product-service
development, competitiveness and sustainability. Routledge.