Accounting Business Reporting for Decision Making

152 Accounting: Business Reporting for Decision Making

May 15

16

17

18

19

21

22

23

27

28

29

31

Paid rent for the past week $1000.

Paid casual wages $900.

Paid gas and electricity $229.

Received fees for services $880.

Received fees for services $1200.

Sent an invoice to client $350.

Paid invoice received 11 May.

Paid rent for the past week $1000.

Received invoice from Cool Carpets $1500 for new office carpet.

Paid phone bill $300.

Sent invoice to client $1400.

Won money at the Brisbane Cup and contributed a further $20 000 into business.

4.31 Recording in the ledger and trial balance and understanding the purpose of

a trial balance    LO6, 8

Using the data in problem 4.30:

a. record the transactions in the ledger for Anthony Reader (interior designer) for the month of

May 2017.

b. prepare a trial balance at 31 May 2017.

c. What is the purpose of the trial balance? Illustrate, by example, situations that would cause the

trial balance not to balance.

4.32 Preparing a statement of profit or loss and a balance sheet    LO5, 8

Using the data from the trial balance in problem 4.31, prepare a statement of profit or loss for the

period ending 31 May 2017 and a balance sheet as at 31 May 2017.

4.33 Analysing business transactions and preparing a worksheet and

a balance sheet    LO4, 5

From the following business transactions of Kathy Baker (landscape consultant):

a. state the impact on the accounting equation for each transaction. For example:

6 June Cash $216 000 Capital 216 000

b. prepare a worksheet and a balance sheet for the month of June 2017 from the following

information.

June 6

8

11

16

21

22

23

24

28

29

30

Kathy commenced business operations with a $216 000 cash injection.

Paid internet advertising fees $713.

Purchased drawing board on credit $2441.

Paid electricity account $272.

Purchased stationery for cash $380.

Sent invoice to client for services performed $808.

Purchased boyfriend a new iPad for his birthday $1058 using personal funds.

Paid business registration fee to local council $264.

Withdrew cash from business $864.

Paid advertising fees $637.

Received interest from business bank account $32.

4.34 Recording in the ledger and trial balance and understanding the purpose

of the ledger    LO6, 8

a. Using the business transactions in problem 4.33, record the transactions in the ledger of Kathy

Baker.

b. What is the advantage of recording in the ledger compared to the journal?

c. Prepare a trial balance for Kathy Baker at 30 June 2017.