Accounting Records and Financial Statements for Conga, Toy Retailer

This assignment provides a comprehensive analysis of the accounting records and financial statements for Conga, a sole trader toy retailer. The solution includes detailed journal entries, sales and purchase day books, cash receipts and payments books, and various ledger accounts such as purchases, expenses, accounts receivables, trade payables, discount accounts, electricity and rent expenses, capital, and loan accounts. The assignment also covers the preparation of financial statements, including explanations of accounting concepts like prudence and accruals, and the recording of sales with value-added tax. The document thoroughly explains the accounting processes from the initial transactions to the final financial reporting stages, providing a complete understanding of the accounting cycle for a small business.

THE ACCOUNTING RECORDS AND FINANCIAL STATEMENTS FOR CONGA

Table of Contents
QUESTION.........................................................................................................................................3
Prepare the accounting records and financial statements for Conga, a sole trader toy retailer business, as
explained overleaf........................................................................................................................3
Explain the prudence concept and accruals (matching) concept......................................................17
3. Explanation on recording of sales on value added tax................................................................18
REFERENCES...................................................................................................................................19

QUESTION
Prepare the accounting records and financial statements for Conga, a sole trader toy retailer
business, as explained overleaf.
Journal entries:
Journal entries
s.no. Particulars Debit Credit
1 Credit purchase a/c Dr 2000
To trade payable 2000
2 Credit purchase a/c Dr 400
To trade payable 400
3 Credit purchase a/c Dr 300
To trade payable 300
4 Credit purchase a/c Dr 200
To trade payable 200
5 Credit purchase a/c Dr 500
To trade payable 500
6 Expenses a/c Dr 200
To cash 200
7 Expenses a/c Dr 200
To cash 200
8 Expenses a/c Dr 400
To cash 400
9 accounts receivables a/c dr 150
To return outwards 150
10 accounts receivables a/c dr 150
To return outwards 150
11 Cash A/c dr 100
To trade payables 100
12 Cash A/c dr 200
To trade payables 200
13 Accounts receivable a/c dr 300
To credit sales 300

14 Accounts receivable a/c dr 400
To credit sales 400
15 Accounts receivable a/c dr 500
To credit sales 500
16 Accounts receivable a/c dr 400
To credit sales 400
17 Accounts receivable a/c dr 250
To credit sales 250
18 Cash a/c dr 150
To sales 150
19 Cash a/c dr 150
To sales 150
20 Cash a/c dr 250
To sales 250
21 Return inwards ac/dr 100
To trade payables 100
22 Return inwards ac/dr 100
To trade payables 100
23 Allowance for doubtful accounts DR. 1100
to accounts receivables 1100
(3% of accounts receivables are allowance for
doubtful debts)
24 Allowance for doubtful accounts DR. 6200
to accounts receivables 6200
25 Cash a/c dr 2000
Discount a/c dr 2000
to accounts receivables 4000
26 Trade payable account dr 3000
To cash a/c 2000
To discount receivable a/c 1000
27 Electricity expenses a/c dr 3000
To cash 3000
28 Rent expenses a/c dr. 5000

To cash 5000
29 Cash a/c dr 45000
To capital 45000
30 Loan account DR 40000
Interest a/c dr 20000
To bank account 60000
31 Wages a/c dr 4000
To accrued wages 4000
Total 138700 138700
Conga Sales Day Book December 2018
Date Customer Invoice Amount dr cr
No.
30-Nov-18 sales 390390
31-Dec-18 cash 150
31-Dec-18 cash 150
31-Dec-18 cash 250
31-Dec-18 accounts receivables 300
31-Dec-18 accounts receivables 400
31-Dec-18 accounts receivables 500
31-Dec-18 accounts receivables 400
31-Dec-18 accounts receivables 250
Total 392790
Conga Sales Returns Day Book December 2018
Date Customer Invoice Amount

No. dr cr
30-Nov-18 Return inwards 6200
31-Dec-18 trade payables 100
31-Dec-18 trade payables 100
Total 6400
Conga Purchase Day Book December 2018:
Date Customer Invoice Amount dr cr
No.
30-Nov-18 purchases 135500
31-Dec-18 Trade payable 2000
31-Dec-18 Trade payable 400
31-Dec-18 Trade payable 300
31-Dec-18 Trade payable 200
31-Dec-18 Trade payable 500
Total 138900
Conga Purchase Returns Day Book December 2018:
Date Customer Invoice Amount dr cr
No.
31-Dec-18 accounts recievables 150
31-Dec-18 accounts recievables 150
Total 300

Conga Cash Receipts Book December 2018
Date Customer Invoice Amount
No. dr cr
accounts recievables 2000
31-Dec-18 Trade payables 100
31-Dec-18 Trade payables 200
31-Dec-18 sales 150
31-Dec-18 sales 150
31-Dec-18 sales 250
capital 45000
Total 47850
Conga Cash Payments Book December 2018:
Date Customer Invoice Amount
No. dr cr
31-Dec-18 expenses 200
31-Dec-18 expenses 200
31-Dec-18 expenses 400
31-Dec-18 Trade payables 2000
31-Dec-18 Electricity expense
s a/c dr 3000
31-Dec-18 Rent expenses a/c d
r. 5000
Total 10800
GENERAL LEDGER:
Sales Account
Date Description Dr Date Description Cr

to balance b/d 390390 By balance Cf 387990
by accounts recivables 300
by accounts recivables 400
by accounts recivables 500
by accounts recivables 400
by accounts recivables 250
cash 150
cash 150
cash 250
total 390390 total 390390
Purchases Account
Date Description Dr Date Description Cr
To trade payables 2000 By balance b/d 135500
To trade payables 400
To trade payables 300
To trade payables 200
To trade payables 500
to balance C/f 132100
Total 135500 total 135500
Expenses Account
Date Description Dr Date Description Cr
To cash 200
To cash 200 By balance c/f 800
To cash 400
Total 800 Total 800

accounts recievables Account
Date Description Dr Date Description Cr
to retuern outwards 150 allowance for doubtfull debt
s 1100
to retuern outwards 150 allowance for doubtfull debt
s 6200
to credit sales 300 cash 2000
to credit sales 400 discount allowed 2000
to credit sales 500 By balance b/d 36660
to credit sales 400
to credit sales 250
To balance c/f 45810
Total 47960 Total 47960
Trade payables Account
Date Description Dr Date Description Cr
to cash 2000 by cash 100
to discount recei
ved 1000 by cash 200
to balance b/d 30900 return inward 100
return inward 100
By balance c/f 33400
Total 33900 Total 33900
Discount allowed Account
Date Description Dr Date Description Cr
to accounts recievables 2000 balance c/f 2000
Total 2000 Total 2000
discount recievable Account
Date Description Dr Date Description Cr
to balance c/f 1000 Trade payable 1000
Total 1000 Total 1000

Electricity expenses Account
Date Description Dr Date Description Cr
to cash 3000 By balance b/d 22280
To balance c/f 19280
total 22280 total 22280
Rent expenses Account
Date Description Dr Date Description Cr
to cash 5000 balance b/d 46400
To balance c/f 41400
Total 46400 Total 46400
capital Account
Date Description Dr Date Description Cr
To drawings 90 by cash 45000
to balance c/f 194910 by balance b/d 150000
total 195000 total 195000
loan Account
Date Description Dr Date Description Cr
to bank 20000 by balance b/d 60000
To balance c\f 40000
Total 60000 total 60000
interest on loan Account
Date Description Dr Date Description Cr
to bank 20000 By balance C/f 20000
Total 20000 Total 20000

bank Account
Date Description Dr Date Description Cr
by interest 20000
by loan 40000
To balance c/f 75410 by balance b/d 15410
Total 75410 Total 75410
wages Account
Date Description Dr Date Description Cr
to accrued wages 4000 by balance b/d 51000
To balance c/f 47000
Total 51000 Total 51000
accrued wages Account
Date Description Dr Date Description Cr
to balance c/f 4000 by wages 4000
Total 4000 Total 4000
allowance for doubtful Account
Date Description Dr Date Description Cr
to accounts recievables 1100 balance c/f 7300
to accounts recievables 6200
Total 7300 Total 7300
Return inward Account
Date Description Dr Date Description Cr
to trade payables 100 by balance b/d 6200
to trade payables 100

To balance c/f 6000
Total 6200 Total 6200
Advertisement Account
Date Description Dr Date Description Cr
to balance c/f 22000 by balance b/d 22000
Total 22000 Total 22000
return outward Account
Date Description Dr Date Description Cr
accounts recievables 150 by balance c/f 300
accounts recievables 150
Total 300 Total 300
Inventories Account
Date Description Dr Date Description Cr
To balance c/f By balance b/d 60140
Closing inventories 40000 By sales 387990
Purchase 132100 Return outwards 300
Return inwards 6000
To balance c/f 270330
Total 448430 Total 448430
Equipement Account
Date Description Dr Date Description Cr
Depreciation on equipment 46000 By balance b/d 280000
To balance C/f 234000
Total 280000 Total 280000