Accounting Project: Financial Statements and Analysis

This accounting project provides a detailed overview of the accounting cycle, including journal entries, ledger accounts, and trial balances. The assignment covers the preparation of financial statements, such as the statement of profit or loss and the statement of financial position (balance sheet). The project includes examples of various financial transactions, such as capital introduced, purchases, sales, loan receipts, and expense payments. The document also addresses revenue and capital expenditures, offering a comprehensive understanding of financial reporting and analysis. The project is divided into tasks, each focusing on different aspects of the accounting process, from recording transactions to preparing final financial statements, which helps to provide a solid foundation in accounting principles and practices.

Accounting
1

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
Journal entries: ............................................................................................................................3
Ledger account: ...........................................................................................................................4
Trail balance: ..............................................................................................................................5
(c) Statement of Trading and Profit or Loss for the Month ended 30 April................................6
TASK 2............................................................................................................................................6
Journal: ........................................................................................................................................6
Ledger accounts...........................................................................................................................7
(b): Trial balance .........................................................................................................................9
(c): Statement of profit and loss...................................................................................................9
TASK 3..........................................................................................................................................10
(a): Journals................................................................................................................................10
(b) Trail balance.........................................................................................................................14
(c): Statement of profit and loss statement................................................................................14
TASK 4..........................................................................................................................................15
Ledger accounts and recording of transactions in the books of Ricardo...................................15
TASK 5..........................................................................................................................................18
Revenue expenses......................................................................................................................18
Capital expenditure....................................................................................................................18
CONCLUSION..............................................................................................................................19
REFERENCES..............................................................................................................................20

INTRODUCTION
Accounting is said to be one of the crucial aspects for an organisation. It is basically
known as the systematic analysis of the financial transactions that are done by the company
during the period of time. This project aimed at providing specific information about the journal,
ledger and trail balance that are considered as primary record of the company. Apart from this,
information about the revenue and capital expenses are covered under this report (Zeff, 2016).
TASK 1
Journal entries:
(a) Journal Entries in the Books of Maxim
(In￡)
Date Particulars Debit Credit
05-04-18 Cash A/c Dr. 300
To Capital A/c 300
(Being Capital introduced in the business)
07-04-18 Purchases A/c Dr. 200
To Cash A/c 200
(Being goods is purchased)
08-04-18 Cash A/c Dr. 250
To Tatiana A/c 250
(Being loan is received from Tatiana)
15-04-18 Motor Van A/c Dr. 150
To Cash A/c 150
(Being Motor van purchased in cash)
20-04-18 Cash A/c Dr. 350
To Sales A/c 350
(Being goods is sold)
28-04-18 Rent A/c Dr. 50
To Cash A/c 50
(Being rent is paid in cash)
29-04-18 Tatiana A/c Dr. 200
To Cash A/c 200
3

(Being part of loan is repaid)
30-04-18 Capital A/c Dr. 60
To Cash A/c 60
(Being cash is withdrawal by owner)
Ledger account:
(a) LEDGER ACCOUNTS
(In￡)
Capital A/c
Date Particulars Amount Date Particulars Amount
30-04-18 To Cash A/c 60 05-04-18 By Cash A/c 300
To Closing Balance C/d 240
Total 300 Total 300
Cash A/c
Date Particulars Amount Date Particulars Amount
05-04-18 To Capital A/c 300 07-04-18 By Purchases A/c 200
08-04-18 To Tatiana A/c 250 15-04-18 By Motor Van A/c 150
20-04-18 To Sales A/c 350 28-04-18 By Rent A/c 50
29-04-18 By Tatiana A/c 200
30-04-18 By Capital A/c 60
By Closing Bal. C/d 240
Total 900 Total 900
Purchases A/c
Date Particulars Amount Date Particulars Amount
07-04-18 To Cash A/c 200 30-04-18 By Trading and P&L A/c 200

Total 200 Total 200
Tatiana A/c
Date Particulars Amount Date Particulars Amount
29-04-18 To Cash A/c 200 08-04-18 By Cash A/c 250
30-04-18 To Closing Balance C/d 50
Total 250 Total 250
Motor Van A/c
Date Particulars Amount Date Particulars Amount
15-04-18 To Cash A/c 150 30-04-18 By Closing Bal. C/d 150
Total 150 Total 150
Sales A/c
Date Particulars Amount Date Particulars Amount
30-04-18 To Trading and P&L A/c 350 20-04-18 By Cash A/c 350
Total 350 Total 350
Rent A/c
Date Particulars Amount Date Particulars Amount
28-04-18 To Cash A/c 50 30-04-18 By Trading and P&L A/c 50
Total 50 Total 50
Trail balance:
TRIAL BALANCE
(In￡)
Particulars Debit Credit
5

Capital - 240
Cash 240 -
Purchases 200 -
Tatiana - 50
Motor Van 150 -
Sales - 350
Rent 50 -
Total 640 640
(c) Statement of Trading and Profit or Loss for the Month ended 30 April
(In￡)
Particulars Amount Particulars Amount
To Purchases A/c 200 By Sales A/c 350
To Gross Profit C/d 250 By Closing Stock A/c 100
450 450
To Rent A/c 50 By Gross Profit B/d 250
To Net Profit C/d 200
250 250
Statement of Financial Position at 30th April
(In￡)
Liabilities Amount Assets Amount
Capital 240 Non-Current Assets:
Add: Net Profit For the Year 200 440 Motor Van 150
Current Assets:
Unsecured Loans: Cash in Hand 240
Tatiana 50 Closing Stock 100
Total 490 Total 490
TASK 2
Journal:
(a) Journal Entries in the books of Pendo for the month of January
(In￡)
Date Particulars Debit Credi

t
01-01-18 Cash A/c Dr. 5000
To Capital A/c 5000
(Being Capital is introduced in the business)
02-01-18 Motor Van A/c Dr. 600
To Cash A/c 600
(Being Motor Car is purchased in cash)
03-01-18 Purchases A/c Dr. 1300
To Cash A/c 1300
(Being goods is purchased)
04-01-18 Cash A/c Dr. 1000
To Sergei A/c 1000
(Being loan is received from Sergei)
10-01-18 Motor Van Expenses A/c Dr. 200
To Cash A/c 200
Being Expenses is paid on motor van)
13-01-18 Cash A/c Dr. 300
To Sales A/c 300
(Being goods is sold on cash)
20-01-18 Cash A/c Dr. 500
To Sales A/c 500
(Being goods is sold on cash)
24-01-18 Storage Expenses A/c Dr. 150
To Cash A/c 150
(Being storage Expense is paid)
27-01-18 Sergei A/c Dr. 350
To Cash A/c 350
(Being part of loan is repaid to Sergei)
30-01-18 Capital A/c Dr. 175
To Cash A/c 175
(Being Cash is Withdrawal from business)
7

Ledger accounts
(a) LEDGER ACCOUNTS
(In￡)
Capital A/c
Date Particulars Amount Date Particulars Amount
30-01-18 To Cash A/c 175 01-01-18 By Cash A/c 5000
31-01-18 To Closing Balance C/d 4825
Total 5000 Total 5000
Cash A/c
Date Particulars Amount Date Particulars Amount
01-01-
18 To Capital A/c 5000 02-01-18 By Motor Van A/c 600
04-01-
18 To Sergei A/c 1000 03-01-18 By Purchases A/c 1300
13-01-
18 To Sales A/c 300 10-01-18 By Motor Van Expenses A/c 200
20-01-
18 To Sales A/c 500 24-01-18 By Storage Expenses A/c 150
27-01-18 By Sergei A/c 350
30-01-18 By Capital A/c 175
By Closing Balance C/d 4025
Total 6800 Total 6800
Motor Van A/c
Date Particulars Amount Date Particulars Amount
02-01-18 To Cash A/c 600 31-01-18 By Closing Balance C/d 600
Total 600 Total 600
Purchases A/c
Date Particulars Amount Date Particulars Amount
03-01-18 To Cash A/c 1300 31-01-18 By Trading and P&L A/c 1300
Total 1300 Total 1300
Sergei A/c
Date Particulars Amount Date Particulars Amount

27-01-18 To Cash A/c 350 04-01-18 By Cash A/c 1000
31-01-18 To Closing Balance C/d 650
Total 1000 Total 1000
Motor Van Expenses A/c
Date Particulars Amount Date Particulars Amount
10-01-18 To Cash A/c 200 31-01-18 By Trading and P&L A/c 200
Total 200 Total 200
Sales A/c
Date Particulars Amount Date Particulars Amount
31-01-18 To Trading and P&L A/c 800 13-01-18 By Cash A/c 300
20-01-18 By Cash A/c 500
Total 800 Total 800
Storage Expenses A/c
Date Particulars Amount Date Particulars Amount
24-01-18 To Cash A/c 150 31-01-18 By Trading and P&L A/c 150
Total 150 Total 150
(b): Trial balance
TRIAL BALANCE
(In￡)
Particulars Debit Credit
Capital - 4825
Cash 4025 -
Motor Van 600 -
Purchases 1300 -
Sergei - 650
Motor Van Expenses 200 -
Sales - 800
Storage Expenses 150 -
Total 6275 6275
9

(c): Statement of profit and loss
Statement of Trading and Profit or Loss for the Month ended 30th January
(In￡)
Particulars Amount Particulars Amount
To Purchases A/c 1300 By Sales A/c 800
To Gross Profit C/d 300 By Closing Stock A/c 800
1600 1600
To Motor Van Expenses A/c 200 By Gross Profit B/d 300
To Storage Expenses A/c 150
By Net Loss C/d 50
350 350
Statement of Financial Position at 31th January
(In￡)
Liabilities Amount Assets Amount
Capital 4825 Non-Current Assets:
Less: Net Loss For the Year 50 4775 Motor Van 600
Current Assets:
Unsecured Loans: Cash in Hand 4025
Sergei 650 Closing Stock 800
Total 5425 Total 5425
TASK 3
(a): Journals
(a) Journal Entries In the Books of Mufta
(In￡)
Date Particulars Debit Credit
02-01-18 Harvey A/c Dr. 124
To Sales A/c 124
(Being Goods sold to Harvey on credit)
05-01-18 Wages A/c Dr. 12

To Cash A/c 12
(Being wages paid in cash)
05-01-18 Purchases A/c Dr. 150
To Rich A/c 150
(Being goods purchased on credit from rich
07-01-18 Cash A/c Dr. 18
To Smith A/c 18
(Being smith settled his dues)
09-01-18 Max A/c Dr. 21 -
To Cash A/c 21
(Being amount paid owing to max)
11-01-18 Cash A/c Dr. 64
To Sales A/c 64
(Being goods sold in cash)
14-01-18 Wages A/c Dr. 14
To Cash A/c 14
(Being wages paid in cash)
14-01-18 Purchases A/c Dr. 75
To Cash A/c 75
(Being goods purchased in cash)
15-01-18 Rich A/c Dr. 162
To Cash A/c 162
(Being amount is paid to rich)
20-01-18 Furniture and Fittings A/c Dr. 32
To Cash A/c 32
(Being office desk is purchased in cash)
21-01-18 Wages A/c Dr. 17
To Cash A/c 17
(Being wages paid in cash)
21-01-18 Cash A/c Dr. 110
To Sales A/c 110
(Being goods sold in cash)
23-01-18 Office expenses A/c Dr. 3
To Cash A/c 3
11

(Being Office expenses paid in cash)
23-01-18 Cash A/c Dr. 25
To Harvey A/c 25
(Being Cash is received from Harvey)
28-01-18 Cash A/c Dr. 84
To Sales A/c 84
(Being goods sold in cash)
28-01-18 Wages A/c Dr. 15
To Cash A/c 15
(Being wages paid in cash)
31-01-18 Cash A/c Dr. 30
To Sales A/c 30
(Being goods sold in cash)
LEDGER ACCOUNTS
(In￡)
Capital A/c
Date Particulars Amount Date Particulars
Amou
nt
31-01-
18 By Closing Balance C/d 1049 01-01-18
By Opening Balance
B/d 1049
Total 1049 Total 1049
Harvey A/c
Date Particulars Amount Date Particulars
Amoun
t
01-01-
18 To Opening Balance B/d 39
23-01-
18 By Cash A/c 25
02-01-
18 To Sales A/c 124
31-01-
18 BY Closing Balance C/d 138
Total 163 Total 163
Sales A/c
Date Particulars Amount Date Particulars Amount
31-01-18 To Trading and P&L A/c 412 02-01-18 By Harvey A/c 124
11-01-18 By Cash A/c 64