Accounting Principles: Comprehensive Financial Statement Analysis

This assignment provides a detailed solution to an accounting problem, starting with journal entries for various business transactions, including salaries, sales, and purchases. It then compiles these entries into a general ledger, followed by an adjusted trial balance to ensure accuracy. The assignment culminates in the preparation of key financial statements: an income statement, a retained earnings statement, and a balance sheet, offering a comprehensive view of the company's financial performance and position. Desklib provides this and many other solved assignments and past papers to help students excel.

Running head: ACCOUNTING PRINCIPLE
Accounting Principle
Name of the Student:
Name of the University:
Author’s Note:

1ACCOUNTING PRINCIPLE
Table of Contents
Journal Entries:................................................................................................................................2
General Ledger:...............................................................................................................................3
Adjusted Trial Balance:...................................................................................................................7
Income Statement:...........................................................................................................................7
Retained Earnings Statement:..........................................................................................................8
Balance Sheet:.................................................................................................................................8
Bibliography:.................................................................................................................................10

2ACCOUNTING PRINCIPLE
Journal Entries:
In the books of ……
Journal Entries
Dr. Cr.
Date Particulars
Amoun
t
Amoun
t
December
Transactions:
06-Dec
Salaries & Wages Payable
A/c. Dr. $1,000
Salaries & Wages Expenses
A/c. Dr. $600
To, Cash A/c. $1,600
08-Dec Cash A/c. Dr. $1,900
To, Accounts Receivable A/c. $1,900
10-Dec Cash A/c. Dr. $6,300
To, Sales Revenue A/c. $6,300
Cost of Goods Sold A/c. Dr. $4,100
To, Inventory A/c. $4,100
13-Dec Inventory A/c. Dr. $9,000
To, Accounts Payable A/c. $9,000
15-Dec Supplies A/c. Dr. $2,000
To, Cash A/c. $2,000
18-Dec Accounts Receivable A/c. Dr.
$12,00
0
To, Sales Revenue A/c.
$12,00
0
Cost of Goods Sold A/c. Dr. $8,000
To, Inventory A/c. $8,000
20-Dec
Salaries & Wages Expenses
A/c. Dr. $1,800
To, Cash A/c. $1,800
23-Dec Accounts Payable A/c. Dr. $9,000

3ACCOUNTING PRINCIPLE
To, Cash A/c. $9,000
27-Dec Cash A/c. Dr.
$11,64
0
Sales Discounts A/c. Dr. $360
To, Accounts Receivable A/c.
$12,00
0
Adjustment Entries:
31-Dec
Salaries & Wages Expense
A/c. Dr. $800
To,
Salaries & Wages Payable
A/c. $800
Depreciation Expense A/c. Dr. $200
To, Accumulated Depreciation -
Equipment A/c. $200
Supplies Expense A/c. Dr. $1,700
To, Supplies A/c. $1,700
General Ledger:
Dr. Cash A/c. Cr.
Date Particulars
Amoun
t Date Particulars
Amoun
t
01-Dec To, Balance b/d $7,200
06-
Dec By, Salaries & Wages Payable A/c. $1,000
08-Dec To, Accounts Receivable A/c. $1,900 By, Salaries & Wages Expenses A/c. $600
10-Dec To, Sales Revenue A/c. $6,300
15-
Dec By, Supplies A/c. $2,000
27-Dec To, Accounts Receivable A/c. $11,640
20-
Dec By, Salaries & Wages Expenses A/c. $1,800
23-
Dec By, Accounts Payable A/c. $9,000
31-
Dec By, Balance c/d $12,640
$27,040 $27,040
Dr. Accounts Receivable A/c. Cr.
Date Particulars Amoun Date Particulars Amoun

4ACCOUNTING PRINCIPLE
t t
01-Dec To, Balance b/d $4,600
08-
Dec By, Cash A/c. $1,900
18-Dec To, Sales Revenue A/c. $12,000
27-
Dec By, Cash A/c. $11,640
By, Sales Discounts A/c. $360
31-
Dec By, Balance c/d $2,700
$16,600 $16,600
Dr. Inventory A/c. Cr.
Date Particulars
Amoun
t Date Particulars
Amoun
t
01-Dec To, Balance b/d $12,000
10-
Dec By, Cost of Goods Sold A/c. $4,100
13-Dec To, Accounts Payable A/c. $9,000
18-
Dec By, Cost of Goods Sold A/c. $8,000
31-
Dec By, Balance c/d $8,900
$21,000 $21,000
Dr. Supplies A/c. Cr.
Date Particulars
Amoun
t Date Particulars
Amoun
t
01-Dec To, Balance b/d $1,200
31-
Dec By, Supplies Expense A/c. $1,700
15-Dec To, Cash A/c. $2,000 By, Balance c/d $1,500
$3,200 $3,200
Dr. Equipment A/c. Cr.
Date Particulars
Amoun
t Date Particulars
Amoun
t
01-Dec To, Balance b/d $22,000
31-
Dec By, Balance c/d $22,000
$22,000 $22,000
Dr. Accumulated Depreciation - Equipment A/c. Cr.
Date Particulars Amoun Date Particulars Amoun

5ACCOUNTING PRINCIPLE
t t
31-Dec To, Balance c/d $2,400
01-
Dec By, Balance b/d $2,200
31-
Dec By, Depreciation Expense A/c. $200
$2,400 $2,400
Dr. Accounts Payable A/c. Cr.
Date Particulars
Amoun
t Date Particulars
Amoun
t
23-Dec To, Cash A/c. $9,000
01-
Dec By, Balance b/d $4,500
13-
Dec By, Inventory A/c. $9,000
31-Dec To, Balance c/d $4,500
$13,500 $13,500
Dr. Salaries & Wages Payable A/c. Cr.
Date Particulars
Amoun
t Date Particulars
Amoun
t
06-Dec To, Cash A/c. $1,000
01-
Dec By, Balance b/d $1,000
31-Dec To, Balance c/d $800
31-
Dec By, Salaries & Wages Expense A/c. $800
$1,800 $1,800
Dr. Common Stock A/c. Cr.
Date Particulars
Amoun
t Date Particulars
Amoun
t
31-Dec To, Balance c/d $30,000
01-
Dec By, Balance b/d $30,000
$30,000 $30,000
Dr. Retained Earnings A/c. Cr.
Date Particulars
Amoun
t Date Particulars
Amoun
t
31-Dec To, Balance c/d $9,300
01-
Dec By, Balance b/d $9,300

6ACCOUNTING PRINCIPLE
$9,300 $9,300
Dr. Cost of Goods Sold A/c. Cr.
Date Particulars
Amoun
t Date Particulars
Amoun
t
10-Dec To, Inventory A/c. $4,100
31-
Dec By, Balance c/d $12,100
18-Dec To, Inventory A/c. $8,000
$12,100 $12,100
Dr. Depreciation Expense A/c. Cr.
Date Particulars
Amoun
t Date Particulars
Amoun
t
31-Dec To, Accum Depr.- Equipment A/c. $200
31-
Dec By, Balance c/d $200
$200 $200
Dr. Salaries & Wages Expense A/c. Cr.
Date Particulars
Amoun
t Date Particulars
Amoun
t
06-Dec To, Cash A/c. $600
31-
Dec By, Balance c/d $3,200
20-Dec To, Cash A/c. $1,800
31-Dec To, Salaries & Wages Payable A/c. $800
$3,200 $3,200
Dr. Supplies Expense A/c. Cr.
Date Particulars
Amoun
t Date Particulars
Amoun
t
31-Dec To, Supplies A/c. $1,700
31-
Dec By, Balance c/d $1,700
$1,700 $1,700
Dr. Sales Discount A/c. Cr.
Date Particulars Amoun Date Particulars Amoun

7ACCOUNTING PRINCIPLE
t t
27-Dec To, Accounts Receivable A/c. $360
31-
Dec By, Balance c/d $360
$360 $360
Dr. Sales Revenue A/c. Cr.
Date Particulars
Amoun
t Date Particulars
Amoun
t
31-Dec To, Balance c/d $18,300
10-
Dec By, Cash A/c. $6,300
18-
Dec By, Accounts Receivable A/c. $12,000
$18,300 $18,300
Adjusted Trial Balance:
In the Books of……
Trial Balance
as on 31 December
Particulars Amount Amount
Cash $12,640
Accounts Receivable $2,700
Inventory $8,900
Supplies $1,500
Equipment $22,000
Accum Depr. - Equipment $2,400
Accounts Payable $4,500
Salaries & Wages Payable $800
Common Stock $30,000
Retained Earnings $9,300
Cost of Goods Sold $12,100
Depreciation Expense $200
Salaries & Wages Expense $3,200
Supplies Expense $1,700
Sales Revenue $18,300

8ACCOUNTING PRINCIPLE
Sales Discount $360
TOTAL $65,300 $65,300
Income Statement:
In the books of….
Income Statement
for the period ended 31 December
Particulars Amount
Sales Revenue $18,300
Less: Sales Discount -$360
Net Sales $17,940
Cost of Goods Sold -$12,100
GROSS PROFIT $5,840
Other Revenue $0
TOTAL REVENUE $5,840
Expenses:
Depreciation Expense -$200
Salaries & Wages Expense -$3,200
Supplies Expense -$1,700
Total Expenses -$5,100
Net Profit for the period $740
Retained Earnings Statement:
In the books of….
Retained Earnings Statement
for the period ended 31 December
Particulars Amount
Balance as on 1 December $9,300
Add: Net Profit for the period $740

9ACCOUNTING PRINCIPLE
Balance as on 31 December $10,040
Balance Sheet:
In the books of….
Balance Sheet
as on 31 December
Particulars Amount
Current Assets:
Cash $12,640
Accounts Receivable $2,700
Inventory $8,900
Supplies $1,500
Total Current Assets $25,740
Non-Current Assets:
Equipment $22,000
Accum Depr. - Equipment -$2,400
Total Non-Current Assets $19,600
TOTAL ASSETS $45,340
Current Liabilities:
Accounts Payable $4,500
Salaries & Wages Payable $800
Total Current Liabilities $5,300
Non-Current Liabilities: $0
TOTAL LIABILITIES $5,300
Equity:
Common Stock $30,000
Retained Earnings $10,040
TOTAL EQUITY $40,040
TOTAL LIABILITIES & EQUITY $45,340

10ACCOUNTING PRINCIPLE

11ACCOUNTING PRINCIPLE
Bibliography:
Scott, W.R., 2015. Financial accounting theory (Vol. 2, No. 0, p. 0). Prentice Hall
Williams, J., 2014. Financial accounting. McGraw-Hill Higher Education