Fundamentals of Accounting: Maxim, Pendo, and Mafuta Case Studies

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ACCOUNTING FUNDAMENTALS
1

Table of Contents
Task 1...............................................................................................................................................3
Task 2...............................................................................................................................................7
Task 3.............................................................................................................................................11
Task 4.............................................................................................................................................15
Task 5.............................................................................................................................................28
References......................................................................................................................................29
2

Task 1
Journal Entries in the books of Maxim
Date Particulars Debit (£) Credit (£)
5-Apr Cash A/c Dr 300
To Capital A/c 300
(Being Capital introduced in the company
by cash)
7-Apr Purchases A/c Dr. 200
To Cash A/c 200
(Being Purchases made by Maxim in Cash)
8-Apr Cash A/c Dr. 250
To Loan A/c 250
(Being Short Term Loan Procured by
Maxim)
15-Apr Motor Van A/c Dr. 150
To Cash A/c 150
(Being Motor Van Purchased for Cash by
Maxim)
20-Apr Cash A/c Dr. 350
To Sales A/c 350
(Being Goods Sold for Cash by Maxim)
28-Apr Rent A/c Dr. 50
To Cash A/c 50
(Rent Paid by Maxim in Cash)
29-Apr Loan A/c Dr. 200
To Cash A/c 200
(Repayment of Loan made by Maxim)
30-Apr Drawings A/c Dr. 60
To Cash A/c 60
(Being Drawings made by Maxim from
business in Cash)
3

Total 1,560 1,560
Ledger Accounts of Maxim
Capital A/c
Date Particulars Amount (£) Date Particulars Amount (£)
30-Apr To Balance C/D 300 5-Apr By Cash 300
300 300
Cash A/c
Date Particulars Amount (£) Date Particulars Amount (£)
5-Apr To Capital 300 7-Apr By Purchases 200
8-Apr To Loan 250 15-Apr By Motor Van 150
20-Apr To Sales 350 28-Apr By Rent 50
29-Apr By Loan 200
30-Apr By Drawings 60
30-Apr By Balance C/D 240
900 900
Drawings A/c
Date Particulars Amount (£) Date Particulars Amount (£)
30-Apr To Cash 60 30-Apr By Balance C/D 60
60 60
Loan A/c
Date Particulars Amount (£) Date Particulars Amount (£)
29-Apr To Cash 200 8-Apr By Cash 250
30-Apr To Balance C/D 50
250 250
Motor Van A/C
4

Date Particulars Amount (£) Date Particulars Amount (£)
15-Apr To Cash 150 30-Apr By Balance C/D 150
150 150
Purchases A/C
Date Particulars Amount (£) Date Particulars Amount (£)
7-Apr To Cash 200 30-Apr By Balance C/D 200
200 200
Rent A/C
Date Particulars Amount (£) Date Particulars Amount (£)
28-Apr To Cash 50 30-Apr By Balance C/D 50
50 50
Sales A/C
Date Particulars Amount (£) Date Particulars Amount (£)
30-Apr To Balance C/D 350 20-Apr By Cash 350
350 350
Trial Balance of Maxim as at 30 April
Particulars Debit (£) Credit (£)
Capital 300
Cash 240
Drawings 60
Loan 50
Motor Van 150
5

Purchases 200
Rent 50
Sales 350
Total 700 700
Statement of Profit & Loss of Maxim for the Month ended 30th April
Particulars Amount (£) Amount (£)
Sales 350
Less: COGS (100)
Purchases 200
Less: Closing Stock (100)
Less: Expenses (50)
Rent (50)
Net Profit 200
Statement of Financial Position of Maxim for the Month ended 30th April
Particulars Amount (£)
Shareholder's Fund
Capital 300
Add: Profit/Loss for the Year 200
Less: Drawings (60)
Liabilities
Short Term Loan 50
Total Shareholder's Fund & Liabilities 490
Assets
Cash 240
Motor Van 150
Stock 100
Total Assets 490
Task 2
6

Ledger Accounts of Pendo
Capital A/c
Date Particulars Amount (£) Date Particulars Amount (£)
31-
Jan To Balance C/D 5,000 1-Jan By Cash 5,000
5,000 5,000
Cash A/c
Date Particulars Amount (£) Date Particulars Amount (£)
1-Jan To Capital 5,000 2-Jan By Motor Van 600
4-Jan To Sergie Loan 1,000 3-Jan By Purchases 1,300
13-
Jan To Sales 300
10-
Jan By Motor Van Expenses 200
20-
Jan To Sales 500
24-
Jan By Storage Expenses 150
27-
Jan By Sergie Loan 350
30-
Jan By Drawings 175
31-
Jan By Balance C/D 4,025
6,800 6,800
Drawings A/c
Date Particulars Amount (£) Date Particulars Amount (£)
30-
Jan To Cash 175
31-
Jan By Balance C/D 175
175 175
Motor Van A/C
Date Particulars Amount (£) Date Particulars Amount (£)
7

2-Jan To Cash 600
31-
Jan By Balance C/D 600
600 600
Motor Van Expenses A/C
Date Particulars Amount (£) Date Particulars Amount (£)
10-
Jan To Cash 200
31-
Jan By Balance C/D 200
200 200
Purchases A/C
Date Particulars Amount (£) Date Particulars Amount (£)
3-Jan To Cash 1,300
31-
Jan By Balance C/D 1,300
1,300 1,300
Sales A/C
Date Particulars Amount (£) Date Particulars Amount (£)
31-
Jan To Balance C/D 800
13-
Jan By Cash 300
20-
Jan By Cash 500
800 800
Sergei Loan A/c
Date Particulars Amount (£) Date Particulars Amount (£)
27-
Jan To Cash 350 4-Jan By Cash A/c 1,000
31-
Jan To Balance C/D 650
8

1,000 1,000
Storage Expenses A/C
Date Particulars Amount (£) Date Particulars Amount (£)
24-
Jan To Cash 150
31-
Jan By Balance C/D 150
150 150
Trial Balance of Pendo as at 31 Jan
Particulars Debit (£) Credit (£)
Capital 5,000
Cash 4,025
Drawings 175
Motor Van 600
Motor Van Expenses 200
Purchases 1,300
Sales 800
Sergie Loan A/c 650
Storage Expenses 150
Total 6,450 6,450
Statement of Profit & Loss of Pendo for the Year ended 31st January
Particulars Amount (£) Amount (£)
Sales 800
Less: COGS (500)
Purchases 1,300
Less: Closing Stock (800)
Less: Expenses (350)
Motor Van Expenses (200)
Storage Expenses (150)
Net Profit (50)
9

Statement of Financial position of Pendo for the Year ended 31st January
Particulars Amount (£)
Shareholder's Fund
Capital 5,000
Add: Profit/Loss for the Year (50)
Less: Drawings (175)
Liabilities
Sergie Loan 650
Total Shareholder's Fund & Liabilities 5,425
Assets
Cash 4,025
Motor Van 600
Stock 800
Total Assets 5,425
10

Task 3
Ledger Accounts of Mafuta
Cash A/c
Date Particulars Amount (£) Date Particulars Amount (£)
1-Jan To Balance B/D 343 5-Jan By Wages 12
7-Jan To Smith 18 9-Jan By Max 21
11-
Jan To Sales 64
14-
Jan By Wages 14
21-
Jan To Sales 110
14-
Jan By Purchases 75
23-
Jan To Harvey 25
15-
Jan By Rich 162
28-
Jan To Sales 84
20-
Jan By Furniture & Fittings 32
31-
Jan To Sales 30
21-
Jan By Wages 17
23-
Jan By Office Expenses 3
28-
Jan By Wages 15
31-
Jan By Balance C/D 323
674 674
Furniture & Fittings A/c
Date Particulars Amount (£) Date Particulars Amount (£)
1-Jan To Balance B/D 198
31-
Jan By Balance C/D 230
20-
Jan To Cash 32
230 230
Smith A/c
Date Particulars Amount (£) Date Particulars Amount (£)
11

1-Jan To Balance B/D 18 7-Jan By Cash 18
18 18
Harvey A/c
Date Particulars Amount (£) Date Particulars Amount (£)
1-Jan To Balance B/D 39
23-
Jan By Cash 25
2-Jan To Sales 124
31-
Jan By Balance C/D 138
163 163
Moon A/c
Date Particulars Amount (£) Date Particulars Amount (£)
1-Jan To Balance B/D 26
31-
Jan By Balance C/D 26
26 26
Rich A/c
Date Particulars Amount (£) Date Particulars Amount (£)
15-
Jan To Cash 162 1-Jan By Balance B/D 12
5-Jan By Purchases 150
162 162
Max A/c
Date Particulars Amount (£) Date Particulars Amount (£)
9-Jan To Cash 21 1-Jan By Balance B/D 21
12