Accounting Systems and Processes: A Comprehensive Report

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Accounting Systems and Processes
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Table of Contents
Introduction......................................................................................................................................3
Question 1........................................................................................................................................4
Question 2......................................................................................................................................15
Question 3......................................................................................................................................18
A....................................................................................................................................................18
Conclusion.....................................................................................................................................21
References......................................................................................................................................22
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Introduction
This report demonstrates the accounting systems and the processes and how these works in an
efficient manner in the organization. This report involves the calculation of Pete’s Handyman
Services. Its trial balance is given and a complete financial statement has to be prepared which
involves journal entries, Ledger, income statement and the balance sheet of the company.
This also involves an essay about the history of the accounting system, its origin and how its
practices changed over the period. This report reflected the ethics of accounting which involves
different types of ethical principles with examples that can be useful for an accountant in the
organization. The report discussed the ethical dilemma faced by the accountants and the
decisions which should be made by them ethically.
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Question 1
Journal entry in the books of Pete's Handyman Services for the month of july
2019
Date Particular
L.
F Debit Credit
Amount in $ Amount in $
1-Jul Trailer Dr. $ 4,200
To bank $ 4,200
(for trailer is purchased for $4,200)
1-Jul Bank account Dr. $ 4,200
To bank loan $ 4,200
(for bank loan is taken for purchase
of the trailer)
2-Jul accounts payable Dr. $ 300
To bank $ 300
(for outstanding expenses paid from
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the bank)
4-Jul Mrs Jones account Dr. $ 700
To handyman $ 700
(for service is provided to Mrs Jones
in credit)
7-Jul Bank account Dr. $ 500
To customer $ 500
(for amount recived in thew bank by
the customer for which services is
provided in june)
8-Jul Mr smart account Dr. $ 600
To handyman services $ 600
(for service is provided for which
the payment recived in the june)
9-Jul purchase account Dr. $ 350
To bank account $ 350
(for purchases made from the bank
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account)
10-
Jul Mr budd account Dr. $ 1,300
To handyman service $ 1,300
(for service provided to the Mr.
Budd on credit basis)
12-
Jul Drawing Account Dr. $ 2,500
To bank account $ 2,500
(for amount withdrown for personal
needs)
14-
Jul Bank account Dr. $ 1,250
To handyman service $ 1,250
(for services is provided on the basis
of electronic fund transfer)
15-
Jul expense account Dr. $ 80
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To bank account $ 80
(for expeses occur and payment
made through bank)
16-
Jul bank account Dr. $ 1,300
to Mr. budd $ 1,300
(for amount recived on the service
provided on 10 july)
22-
Jul Mr. Diaz accoutn Dr. $ 500
to Handyman service
account $ 500
(for service is provided on the credit
to Mr. Diaz)
23-
Jul bank account Dr. $ 2,600
to Mr. Hatter $ 2,600
(for advance recived from the
customer as service is to be provided
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in the august)
23-
Jul
Prepaid advertisement expenses
Dr. $ 2,400
To bank account $ 2,400
(for advance payment for the
expeses are made which are to be
occurred in the future)
23-
Jul bank account Dr. $ 700
To Mrs Jones account $ 700
(for amount recived on the services
provided on 4 july)
26-
Jul drawing account Dr. $ 2,500
to bank account $ 2,500
(for amount withdrown for personal
use.
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26-
Jul bank account Dr. $ 280
to handyman services $ 280
(for service provided and amount
recived in the bank account)
30-
Jul
Prepaid insurance expenses account
Dr. $ 320
To bank acocunt $ 320
(for insurrance expenses are made
for the august)
31-
Jul bank loan account Dr. $ 400
to bank account $ 400
(for installment of the loan is
charged on the loan which was taken
for the purchase of trailer)
31-
Jul interest account Dr. $ 336
to bank Account $ 336
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(for interest is charged at the end on
the loan anmount.
31-
Jul outstanding Expenses account Dr. $ 320
to repair expense $ 320
(for expenses recognised but
payment should be made in august)
31-
Jul outstanding Expenses account Dr. $ 150
to telephone expenses $ 150
(for expenses are recognised and it
will happen in future.
31-
Jul depriciation account Dr. $ 190
to equipment account $ 80
to vehicle account $ 110
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(for depriciation is recognised on the
fixed assets)
31-
Jul Insurance account Dr. $ 300
to prepaid insurance $ 300
(for insurance paid)
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Ledgers
Dr. Bank Account Cr.
Date Particular Amount Date Particular
Amoun
t
1-Jul to opening balance $ 3,600 1-Jul by trailer
$
4,200
1-Jul to bank loan $ 4,200 2-Jul by accounts payable
$
300
7-Jul to customer $ 500 9-Jul by purchase
$
350
14-Jul to handyman $ 1,250 12-Jul by drwaing
$
2,500
16-Jul to Mr. budd $ 1,300 15-Jul by expenses
$
80
23-Jul to Mr. hatter $ 2,600 23-Jul by advertisement expenses
$
2,400
23-Jul to Mrs. Jones $ 700 26-Jul by drwaing
$
2,500
26-Jul to handyman $ 280 30-Jul by prepaid insurance $
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