Analysis of Financial Transactions and Statements: A Detailed Report

This report provides a detailed analysis of financial accounting practices, beginning with an introduction to the core concepts and the role of accounting in business decision-making. It explores the advantages and disadvantages of accounting within corporate units, using examples like McDonald's and KFC. The report includes practical applications, such as journal entries for David and the creation of general ledgers and trial balances for Pearce & Sons. Furthermore, it covers the preparation of an income statement for Airman company and evaluates the significant impacts of COVID-19 on the company's financial performance. The report concludes by summarizing the key findings and emphasizing the importance of financial accounting in business operations and strategic planning.

Recording Business
Transactions

Contents
INTRODUCTION.....................................................................................................................................3
ASSESSMENT 1........................................................................................................................................3
PART 1.......................................................................................................................................................3
PART 2.......................................................................................................................................................5
PART 3.......................................................................................................................................................7
PART 4.....................................................................................................................................................10
CONCLUSION........................................................................................................................................12
REFERENCES........................................................................................................................................13

INTRODUCTION
Accounting refers to an activity that underpin transcript, categorization, assessment and outlining
of payment information of an entity inside of business segment and it is only managed to carry
out with the help of financial reporting (Mouritsen and Kreiner, 2016). Essentially accounting is
a dialect of funding. This helps a business to turn a team's employees into meaningful findings
that can be distinguished. All these documents and reviews are produced in a form which helps
to evaluate financial performance together with the company's information. Wherein the current
task consists of a query that includes multi-company financial transactions and needs to generate
trial balances, together with the revenue statement from those documents. The benefits and
drawbacks in the sense of business company are further addressed. Finally, the effect of covid-19
is evaluated on market performance and sustainability.
ASSESSMENT 1
PART 1
A. Identify the choice inside major corporations and clarify their accounting knowledge
criteria.
Financial accounting requires all financial data to be recoded, interpreted and presented
in a way that can be included in reports. And these kinds of financial statements are
helpful for creating successful financial and budget-related planning and policies. This
business will be able to cope with the short results in the future (Bebbington, Russell and
Thomson, 2017). As well as being able to give end-users a superior customer experience.
All the tasks from induction to dismissal include the assessment of the revenue objective,
the preparation and financial planning of advertising events, and the procurement of
various techniques and tools to execute different roles and operations. And all these
decisions are made by the company's chief management and administrators. Obligation in
judgment inside the project relies on the company's organizational framework, for
example, the management chart the leadership team adopted in a bigger company may be
a hierarchical system, governed by senior leadership or board members so that they can
reach their target within a given amount of time. A BT British telecom is a large-scale

stock market and executive board corporation controlled by its CEO, Philip Jansen, and
makes all business decisions for the betterment of the project. This corporation embraces
a structured organizational framework that is a mixture of organization departments and
divisional. All business decisions are made by the top-level governing board on the basis
of the corporation's aim, purpose, mission and vision. For this function, all
responsibilities and positions are assigned to administrators of different agencies and
authority to carry them out.
Financial accounts reflect the financial details pertaining to the company in summary,
which makes it feasible and convenient for the leadership team and business owners to
use the information in strategic growth (Ebaid, 2016). In which financial statements are
prepared on the basis of same industry-wide common standards and guidelines. This
helps them differentiate themselves from other rivals to lay across performance
indicators. It sets out the framework for company to manage investment proposal-related
decisions, such as whether or not these decisions are profitable and commercially viable
for business to take. Further the forecast and guesstimates also are needs to rely on
financial information within corporation and for enhancement according to the situation
of global market. This is important not just in spite of contrast, as well as in view of the
basis for collecting crucial data through non-financial results.
B. Accounting benefits and disadvantages within a corporate unit.
The activities in accounts are reported and assessed within an organization and unique in
scope and all of them are carried out in terms of laws (Libby, 2017). Some benefit and
drawback in relation to the management of accounting documents is as follow in terms of
importance of provided two entities Mc Donald and KFC:
Advantages:
Decision making- It is the duty of the management committee of a company to make
appropriate finance-related decisions and to fulfill this purpose with the aid of accounting
by analyzing existing and previous financial reports (Woods, Linsley and Maffei, 2016).
That market position is fulfilled by accounting books. This offers revenue increase and

outflow details along with sales and expenditures that makes it easier to estimate excess
or shortfall within resources and needs to be arranged in a timely manner. This thereby
helps to develop transparency and accountability for fraud prevention and identification.
Evidence in legal matters- Accounting books of a corporate company serves as business
history as all accounts payable are reported in it. If any legal question happens in regards
to finance or expenditure, the time this records would beneficial, as an evidence business
will use this in trial. They draft balance sheets in the sense of Mc Donald and KFC on the
basis of the particular format of a law and only send them to the registration after the
external director has audited them. This allows them reportable and lawfully reported to
the tax office.
Disadvantage:
Record only financial aspects- It has been considered in a corporate unit to be one of the
main drawbacks of financial reporting as it only involves sales and data relevant only to
the quantitative records. There are different non-financial considerations in this sense,
such as business dynamics, political circumstances, legislation, legal rules, social factors,
and so on. Many of these have major consequences on the running and activities of
business (Collis, Holt and Hussey, 2017). As well as both of these, the recording in
accounting books is left out. Because of this, it reflects an unfinished image during policy
formulation and critical business planning. The business management do not take actions
relating to the towing company in the sense of the towing agency.
Historical nature- Total amount is reported on real expenses in accounting records and
rates may not take into account variations in costs. Because of this, it creates ancient
books of accounts. Much of this data and information should be used as the basis for
future forecasts. It is not linked to the budget's opportunity cost and shifts that increase
with this. With respect to KFC and Mc Donald, it is not important for the calculation
made on the basis of past expense to be accurate that it may also go in the opposite
guideline for future operations.

PART 2
A. Journal Entries of David for the month February 2020
Journal Entries
Date Details Fol DT (£) CT (£)
01/02/20 Asma Ltd. A/c … Dr. 350
To office Fixtures A/c
( not suitable office fixtures returns to Asma
Ltd.)
350
04/02/20 Bad debt A/c...........Dr. 85
To S. Keyes 85
(Debt from S. Keyes , written off as bad)
09/02/20 Machinery A/c …......Dr. 2300
To TS Co. A/c 2100
To bank A/c 200
(Machines boughts from TS company on
part credit & cash)
13/02/20 Bank A/c …........Dr. 220
Bad Debt A/c..........Dr. 50
To S. Hill A/c 270
(only £220 received out of £270 from
bankrupt debtor S. Hill as final settlement)
20/02/20 Drawings A/c ….........Dr. 180
To purchase A/c 180
(products used by owner for personal use)

26/02/20 Drawing A/c..........Dr. 85
To insurance A/c 85
(personal insurance bill debited to business
not stand corrected)
28/02/20 TS company A/c …........Dr. 1050
To bank A/c 1050
(half payment of machine is paid by owner
to TS company in credit)
PART 3
A. General Ledger of Pearce & Sons
Ledger Account
(Amount in GBP)
Date Details Amount Date Details Amount
01/02/20 By bank A/c 21500
01/02/20 By office
fixture A/c
800
01/02/20 By Van A/c 2500
29/02/20 To balance c/f 47300
Total 4300 Total 4300
Bank Account
Date Details Amount Date Details Amount

03/02/20 By cash A/c 1500 01/02/20 To capital A/c 21500
04/02/20 By Van A/c 4800 02/02/20 To Loan A/c 2500
19/02/20 By Nissan
company A/c
5200 25/02/20 To cash A/c 350
28/02/20 By balance c/f 12230
Total 24350 Total 24350
Van Account
Date Details Amount Date Details Amount
01/02/20 To capital A/c 2500
04/02/20 To bank A/c 4800
08/02/20 To Nissan
company A/c
5200
29/02/20 By balance c/f 35000
Total 35000 Total 35000
Quick office Ltd Account
Date Details Amount Date Details Amount
05/02/20 By office
fixture A/c
1100
29/02/20 To balance c/f 1100
Total 1100 Total 1100
Cash Account
Date Details Amount Date Details Amount

15/02/20 By Office
Fixture A/c
70 03/02/20 To bank A/c 1500
25/02/20 By bank A/c 350
29/02/20 By balance c/f 1080
Total 1500 Total 1500
Nissan company Account
Date Details Amount Date Details Amount
08/02/20 By van A/c 5200 19/02/20 To bank A/c 5200
Total 5200 Total 5200
Office Fixture Account
Date Details Amount Date Details Amount
01/02/20 To Capital A/c 800
05/02/20 To Quick
Office Ltd A/c
1100
15/02/20 To Cash A/c 70
28/02/20 To Bank A/c 620
29/02/20 By Balance c/f 2590
Total 2590 Total 2590
Loan Account

Date Details Amount Date Details Amount
02/02/20 By Bank A/c 2500
29/02/20 By Balance
c/f
2500
Total 2500 Total 2500
B. Balance up accounts and extract trail balance as at 30 February 2019.
Trial Balance (At month ending 29/02/20)
(Amount in GBP)
Details Debit Credit
Capital account 47300
Cash account 1080
Van account 35000
Bank account 12230
Quick office Ltd. Account 1100
Office fixture account 2590
Loan account 2500
Total 50900 50900
PART 4
A. Draft an income statement for Airman company for year ending 30th September 2019.
Profit and Loss Account
(For year ending 30th September 2020)

Particulars Amount Particulars Amount
Opening Stock 36000 Sales 80000
Purchases 150000 Less: Returns
Inwards
-2000 78000
Less: Returns
Outwards
-600 149400 Closing Stock 120000
Carriage Inwards 720
Gross Profit c/f 11880
Total 198000 Total 198000
Carriage Outwards 400 Gross Profit c/d 11880
Motor Expenses 1200
Rent 5000
Telephone Charges 620
Wages and Salaries 32000
Insurance 830
Office Expenses 600
Sundry Expenses 300
Net profit / (loss) -29070

Total 11880 Total 11880
B. Impacts of COVID -19 on income statement of company's items.
For growth and achievement, the business unit business forms, social and political consistency.
Destabilization causes a decrease in the corporation's profit maximization, as well as the
incidence of losses in a business segment such as Airman, that was financially viable for 10
years in 2009 and poses a loss in the existing year (Li and Sloan, 2017).
The implementation of the airman corporation initiated by covid-19 has been shown to be
restricted in the initial two areas from September 2019 to March 2020, due to a shorter amount of
time between the fiscal quarter and the pandemic scenario. After March, it was noted but each
and every companies face so many manufacturing, distribution network and marketing delays
due to the implicit assumption of lock-down in each country, likewise, the Airman co. also poses
supplier losses along with enhanced time required by capacity of the body external freight. In
addition, there are losses in sales that correlated with a decrease for products on the market and a
fixed fee must be compensated fairly by the corporation. It's been seen from all this that this
effect on the corporation's procedure and structure results. They could face a loss in this finance,
that they enrolled in their documents, in significance to Airman company. The scenario that
Covid-19 formed is unique and infectious.
CONCLUSION
It's been analyzed from the above-mentioned report that the choice will be obtained by senior
managers in each organization for the improvement of the organization and will also be capable
of achieving this objective of efficient financial planning with both the quality of accounting
finance. In addition, it only contains data regarding financial that are not regarded to be some
other variables and by which enterprises, other than financial services, would not be able to take
decisions. On the other side, David's journal entries are constantly encouraged along with a few
other revenue declarations. Finally, the effect of Covid-19 on the accounting period has been
seen.