Business Accounting: Catherine Horton's Financial Statement Analysis

This assignment solution provides a comprehensive overview of business accounting principles, focusing on the preparation and analysis of a trial balance and financial statements for Catherine Horton. It includes journal entries, ledger postings, and the creation of a trial balance as of January 31, 2019. The solution also features a trading account, profit and loss account, and balance sheet, demonstrating the flow of financial data and the calculation of key financial metrics. The assignment showcases the application of accounting principles in a practical business context, with detailed calculations and explanations. Desklib offers a wide range of study tools and resources for students.

Business accounting

TABLE OF CONTENTS
1.1...............................................................................................................................................3
1.2...............................................................................................................................................3
Journal entries........................................................................................................................3
Ledgers...................................................................................................................................6
1.3...............................................................................................................................................7

1.1
Trial Balance of Catherine Horton as on 31/12/2018
Sr
No Name of Account DR./
Cr. Debit Credit
1 Premises DR. £
340,000.00
2 Van Dr. £
51,250.00
3 Fixtures Dr. £
8,100.00
4 Inventory Dr. £
63,900.00
5 P Mullen Dr. £
1,400.00
6 F Lane Dr. £
3,100.00
7 Cash at Bank Dr. £
62,400.00
8 Cash in Hand Dr. £
5,600.00
9 S. Hood Cr. £
2,150.00
10 J. Brown Cr. £
4,600.00
11 Owner's Capital
(B/F) Cr. £
529,000.00
Total £
535,750.00
£
535,750.00
1.2
Journal entries
Journal of Catherine Horton for the month of January
Date Particulars Debit Credit
01-Jan Storage Cost Dr £ 400.00
To Cash at Bank £ 400.00
02-Jan Purchase Dr £ 6,080.00
To S. Hood £ 1,450.00
To D. Main £ 2,060.00
To W. Tone £ 960.00
R. Foot £ 1,610.00

03-Jan J Wilson Dr £ 1,120.00
T Cole Dr £ 1,640.00
F Syme Dr £ 2,080.00
J Allen Dr £ 910.00
P White Dr £ 2,420.00
F Lane Dr £ 770.00
To Sales £ 8,940.00
04-Jan Motor Exp. Dr £ 470.00
To Cash £ 470.00
07-Jan Drawings Dr. £ 1,500.00
To Cash £ 1,500.00
09-Jan T Cole Dr. £ 680.00
J Fox Dr. £ 1,310.00
To Sales £ 1,990.00
11-Jan Sales Return Dr £ 680.00
To J Wilson £ 270.00
To F Syme £ 410.00
14-Jan Van Dr. £ 28,500.00
To Abel Motors £ 28,500.00
16-Jan Bank Dr. £ 6,669.00
Discount Allowed Dr. £ 351.00
To P Mullen £ 1,400.00
To F Lane £ 3,100.00
To J Wilson £ 850.00
To F Syme £ 1,670.00
19-Jan R. Foot Dr. £ 50.00
To Purchase Return £ 50.00
22-Jan Purchase Dr. £ 3,740.00
To L Mole £ 1,830.00
To W Wright £ 1,910.00
24-Jan S. Hood Dr £ 3,600.00
J Brown Dr £ 4,600.00
R Foot Dr £ 1,400.00
To Bank £ 8,640.00
To Discount Received £ 960.00
27-Jan Salary Dr £ 4,800.00

To Bank £ 4,800.00
30-Jan Business Rates Dr £ 1,320.00
To Bank £ 1,320.00
31-Jan Abel Motors Dr £ 20,500.00
To Bank £ 20,500.00
£ 95,590.00 £ 95,590.00

Ledgers
Receivables A/c
Dat
e
Particul
ars
P
Mull
en
F
Lan
e
J
Wils
on
T
Col
e
F
Sy
me
J
All
en
P
Whi
te
F
Lan
e
J
Fo
x
Dat
e Particulars
P
Mull
en
F
Lan
e
J
Wils
on
T
Col
e
F
Sy
me
J
All
en
P
Whi
te
F
Lan
e
J
Fo
x
01-
Jan
To
balance
b/d
1400 3100 0 0 0 0 0 0 0 16-
Jan By Bank 1330 2945 807.5 0 1586.
5 0 0 0 0
03-
Jan
To
Sales 0 1120 1640 2080 910 2420 770 0 11-
Jan
By Sales
Return 0 0 270 0 410 0 0 0 0
09-
Jan
To
Sales 0 0 0 1310 0 0 0 0 680 16-
Jan
By Discount
Allowed 70 155 42.5 0 83.5 0 0 0 0
31-
Jan
By Balance
c/d 0 0 0 2950 0 910 2420 770 680
1400 3100 1120 2950 2080 910 2420 770 680 1400 3100 1120 2950 2080 910 2420 770 680
Payables Account
Date Particulars S.
Hood
J.
Brow
n
D
Main
W
Tone
R
Foot
L
Mol
e
W
Wright Date Particulars S.
Hood
J.
Brow
n
D
Main
W
Tone
R
Foot
L
Mol
e
W
Wright
24-
Jan To Bank 3240 4140 0 0 1260
0 0
01-
Jan
By
Balance
B/d
2150 4600 0 0 0
0 0
24-
Jan
To Discount
Rec. 360 460 0 0 140 0 0 02-
Jan
By
Purchase 1450 0 2060 960 1610 0 0

31-
Jan
To Balance
C/d 0 0 2060 960 210 1830 1910 22-
Jan
By
Purchase 0 0 0 0 0 1830 1910
3600 4600 2060 960 1610 1830 1910 3600 4600 2060 960 1610 1830 1910
Cash at Bank
Date Particulars Amount Date Particulars Amount
01-Jan To Balance B/d 62400 01-Jan By Storage Cost 400
16-Jan To P Mullen 1330 24-Jan By S Hood 3240
16-Jan To F Lane 2945 24-Jan By J Brown 4140
16-Jan To J Wilson 807.5 24-Jan By R Foot 12600
16-Jan To F Syme 1586.5 27-Jan By Salaries 4800
30-Jan By Business Rates 1320
31-Jan By Abel Motors 20500
31-Jan By Balance c/d 22069
69069 69069
Cash in Hand
Date Particulars Amount Date Particulars Amount
01-Jan To Balance B/d 5600 04-Jan By Motor Expenses 470
07-Jan By Drawings 1500
31-Jan By Balance C/d 3630
5600 5600
Van
Date Particulars Amount Date Particulars Amount

01-Jan To Balance B/d 51250 31-Jan By Balance C/d 79750
14-Jan To Abel Motors 28500
79750 79750
Abel Motors
Date Particulars Amount Date Particulars Amount
31-Jan To Bank 20500 14-Jan By Van 28500
31-Jan To Balance c/d 8000
28500 28500
Trial Balance of Catherine Horton as on 31/01/2019
Sr No Name of Account Debit Credit
1 Premises 340000 0
2 Van 79750 0
3 Fixtures 8100 0
4 Receivables 7730
5 Payables 6970
6 Cash in Hand 3630 0
7 Cash at Bank 22069 0
8 Abel Motors 0 8000
9 Purchase 9820 0
10 Purchase Return 0 50
11 Sales 0 10930
12 Sales Return 680 0
13 Storage Cost 400
14 Motor Expense 470
15 Drawings 1500
16 Owners Equity 529000

17 Discount Allowed 351
18 Discount Received 960
19 Salary 4800
20 Business Rates 1320
21 Inventory 75290
555910 555910

1.3
Trading Account for the month of January
Particulars Amount Amount Particulars Amount Amount
To Opening Stock
£
63,900.00 By Sales
£
10,930.00
£
10,250.00
To Purchase
£
9,820.00
£
9,770.00 (-) Sales Return
£
680.00
(-) Purchase
Return
£
50.00
By Closing Stock*
£
75,290.00
To Gross Profit
£
11,870.00 (Assumed)
£
85,540.00
£
85,540.00
Profit and Loss Account for the month of January
Particulars Amount Particulars Amount
To Storage Cost
£
400.00 By Gross Profit
£
11,870.00
To Motor
Expenses
£
470.00
By Discount
Received
£
960.00
To Salaries
£
4,800.00
To Business Rates
£
1,320.00
To Discount
Allowed
£
351.00
To Net Profit
£
5,489.00
£
12,830.00
£
12,830.00
Balance Sheet for the month ending Jan 2019
Liabilities Amount Assets Amount
Owners
Equity Premises
£
340,000.00
Opening
Balance
£
529,000.00
£
521,599.00 Van
£
79,750.00
(+) Profit
-£
5,901.00 Fixtures
£
8,100.00

(-) Drawing
£
1,500.00 Inventory
£
75,290.00
Recievab
les
Abel
Motors
£
8,000.00 P Mullen £
-
£
7,730.00
F Lane £
-
Payables J Wilson £
-
Laiablities £
6,970.00 T Cole £
2,950.00
S. Hood £
- F Syme £
-
J. Brown £
- J Allen £
910.00
D Main £
2,060.00 P White £
2,420.00
W Tone £
960.00 F Lane £
770.00
R Foot £
210.00 J Fox £
680.00
L Mole £
1,830.00
W Wright £
1,910.00
Cash in
Hand
£
3,630.00
Cash at
Bank
£
22,069.00
£
536,569.00
£
536,569.00