Financial Accounting
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- Date Submitted: 09/04/2011 02:50 PM
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QUESTION 1
INCOME STATEMENT OF PRONTO PRINT AS AT 31ST DECEMBER 2010
£
Sales Revenue 88,254 + 19,591 107,845
Cost of sales £2400 + £44,000 + 1070 (47,470)
Less closing inventory (3,100)
Gross profit 52,528
Other incomes
Sale of old equipment & Bank interest 1,657
Operating profit 54,185
Admin & other expenses
Van (7600)
General Business Expenses (9250)
Rent (4800)
Electricity 3200+1120 (4320)
Telephone (720)
Depreciation (Motor van 3600 + Machinery 950) (4550)
Provision for bad debt (120)
Loss from fix asset disposal (9000)
Net profit 13,825
BALANCE SHEET OF PRONTO PRINT AS AT 31ST DECEMBER 2010
ASSETS £ CLAIMS £
Tangible Assets Equity 30,000
Printing Equipment (Cost) 20,000 Equity withdrawal (24,000)
Van (cost) 6,000 Retained profit 13,825 Depreciation 950+3600 (4,550)
Intangible Asset 1,900
Current Assets Other Liabilities
Inventory 3100 Accruals 1,120
Receivables 4445 Payables 1,070
Prepayment 1200
Cash at Bank 1487
Total £33,582 £22,015
Question 1
‘Accounting is concerned with collecting, analysing and communicating financial information. The purpose of which is to help people who use this information to make informed decision’ (Attril & Mclaney 2011). Efficient accounting systems are an essential ingredient of an efficient business. Balance sheets, Income statements and statements of cash flow are the three main financial statements that form the core of Financial Accounting. The statements are used to provide information about the financial position, performance and changes in financial...
INCOME STATEMENT OF PRONTO PRINT AS AT 31ST DECEMBER 2010
£
Sales Revenue 88,254 + 19,591 107,845
Cost of sales £2400 + £44,000 + 1070 (47,470)
Less closing inventory (3,100)
Gross profit 52,528
Other incomes
Sale of old equipment & Bank interest 1,657
Operating profit 54,185
Admin & other expenses
Van (7600)
General Business Expenses (9250)
Rent (4800)
Electricity 3200+1120 (4320)
Telephone (720)
Depreciation (Motor van 3600 + Machinery 950) (4550)
Provision for bad debt (120)
Loss from fix asset disposal (9000)
Net profit 13,825
BALANCE SHEET OF PRONTO PRINT AS AT 31ST DECEMBER 2010
ASSETS £ CLAIMS £
Tangible Assets Equity 30,000
Printing Equipment (Cost) 20,000 Equity withdrawal (24,000)
Van (cost) 6,000 Retained profit 13,825 Depreciation 950+3600 (4,550)
Intangible Asset 1,900
Current Assets Other Liabilities
Inventory 3100 Accruals 1,120
Receivables 4445 Payables 1,070
Prepayment 1200
Cash at Bank 1487
Total £33,582 £22,015
Question 1
‘Accounting is concerned with collecting, analysing and communicating financial information. The purpose of which is to help people who use this information to make informed decision’ (Attril & Mclaney 2011). Efficient accounting systems are an essential ingredient of an efficient business. Balance sheets, Income statements and statements of cash flow are the three main financial statements that form the core of Financial Accounting. The statements are used to provide information about the financial position, performance and changes in financial...