B Current acc

Int on Capital 30000

Total Investment 160k+140k+21429+31371
 DR DR Cashbook
Cashbook

Date Details Folio Disc Alld Cash Bank

2018 $ $ $
1-Mar Balance b/d 600
1-Mar Equipment GL 1,800
16-Mar Cash Sales GL 3,680
23-Mar Cash C 5,000
30-Mar Layby Stores SL 150 1,490
31-Mar Balance c/d 1,035
150 6,080 7,525
1-Apr Balance b/d 880

Layby
list Price 2250 13-Mar
Trade Disc -450
Net 1800
CR Note -160 19-Mar
Owing 1640
less cash dis -150
Cheque 1490

The Balance as at 31 March is an overdraft of $1035 which indicates that Sanjeev withdrew $1035
more from the bank than what he had in his account and so now owes
the bank $1035

DD Ltd
14-Mar Ret Out 600 5-Mar Purchases 5625
31-Mar Balance c/d 5025
5625 5625
1-Apr Balance b/d 5025

Gross Profit X 100

Sales

Business showed improvement year over year as in 2016 for every $100 of sale
the company earned $20 in Gross profit and this increased to $24 in 2017

Strength- as more GP is earned on every $ of sale

Operating Expenses X 100

Revenue

Business showed declining control over expenses as in 2016, for every $100 of
sales revenue, the company incurred $9 in expenses but this grew to $11 in 20
A 2% increase
Weakness as more expenses were incurred to run the business and this erode

Recommendation: to properly analyse those expenses by line item (rent, wage

and to find ways of better managing/controlling the increase eg look for altern
Once expenses are under control, there should be a resulting increase in net in
business performance.

GP margin x Sales = gross profit

Sales $ 995,000
 Gross Profit $ 238,800 24% x $995 000
Cost of sales $ 756,200

COGS # of times the average stock is sold

Ave stock

Cost of sales 756200 23.267692 times

Ave stock ($25k+$40K)/2

Days taken to sell the ave stock 365

23.267692

15.686988 days

Zidan A balance takes its name from the side its BROUGHT

Sales Ledger control ac, Total Debtors , Accounts Receivable Control

1-Oct Debit Balance b/d 42,680 1-Oct Credit Balance b/d
31-Oct Credit Sales 102,900 31-Oct Returns Inwards
31-Oct Dishonoured Cheque 1,200 31-Oct Cash /Bank
31-Oct Interest on late payment 160 31-Oct Disc All'd
31-Oct Refund to customer 300 31-Oct Bad debts
31-Oct Balance c/d 590 31-Oct Debit Balance c/d
147,830
1-Nov Debit Balance b/d 46700 1-Nov Credit Balance b/d

Purchases Ledger control ac, Total Crediors , Accounts Payable Cont

1-Oct Debit Balance b/d 620 1-Oct Credit Balance b/d
31-Oct Returns Outwards 5,390 31-Oct Credit Purchases
31-Oct Cash /Bank 75,000 31-Oct Interest on late payment
31-Oct Disc Rec'd 4,200
31-Oct Credit Balance c/d 10,040 31-Oct Debit Balance c/d
95,250
1-Nov Debit Balance b/d 700 1-Nov Credit Balance b/d

Benji and Nicka

Profit and Loss Appropriation Account
For year 31 December 2017
Net Profit after loan interest
Add Interest on drawings (prorate if necessary)
Benji (5% x $6000)
Nicka (5% x $4300)

LESS: Interest on capital: (% x capital balances)

Benji (10%x $160K)
Nicka (10% x $140k)

Salaries: (check if the salary given is per annum or per month)

Nicka

Share of profits
Benji (21715 x3/5)
Nicka (21715 x2/5)
 Current account
Benji Nicka
Balance b/d 1,300 Balance b/d
Drawings 6,000 4,300 Int On Capital
Int On Drawings 300 215 Salaries
Balance c/d 21,429 31,371 Share of Profits
Balance c/d
8.50% 29,029 35,886
Balance b/d

Kaycee Garments
Manufacturing Account (everything to do with the factory, raw
For the year ended 31 December 2017

Opening stock of raw materials

Purchases of raw materials 118,500
Add carriage in/transport of raw materials 12,000
Less returns out of raw materials (18,200)
Net purchases of Raw materials
Cost of raw materials available for use
less closing stock of raw materials
Cost of raw materials consumed/used
Factory Wages($50400 x 60%)
Prime Cost

Factory Overheads:
Factory Wages($50400 x 40%) 20,160
Factory salary 125,000
Factory Rent and Rates ($35600 x 75%) 26,700
Factory Electricity ($162 400 x75%) 121,800
Factory Insurance (3/4x $12200) 9,150
Depreciation on Machinery (20% x $300k) 60,000

Add opening work in progress

Less Closing work in progress

Cost of goods manufactured

Cost of 1 unit Cost of goods manufactured

No of units produced
 CR CR
Cashbook

Date Details Folio Disc Rec'd Cash Bank

2018 $ $ $
1-Mar Balance b/d 400
9-Mar Drawings GL 200
23-Mar Bank C 5,000
26-Mar Jeff's Air Con PL 375 7,125

31-Mar Balance c/d 880

375 6,080 7,525
1-Apr Balance b/d 1035

eev withdrew $1035

for every $100 of sales
d to $24 in 2017

16, for every $100 of

this grew to $11 in 2017

siness and this erodes net income.

line item (rent, wages, electricity )that increased year over year
ase eg look for alternative suppliers.
ting increase in net income and
$995 000

he side its BROUGHT DOWN ON

ts Receivable Control ac
Balance b/d 950
ns Inwards 4,120
92,400
2,800
860
Balance c/d 46700
147,830
Balance b/d 590

ccounts Payable Control ac

t Balance b/d 28,360
 Purchases 65,950
st on late payment 240

Balance c/d 700

95,250
Balance b/d 10,040

56,200

300
215 515 Int on drawings:
56,715 DR Partner's Current Acc
CR Appropriation Acc

16,000 Interest on Capital, Salaries and share of Profits

14,000 30,000 DR Appropriation Acc
CR Partner's Current Acc
or per month)
5,000
(35,000)
21,715

13,029
8,686
21,715
 take thes figures from the appropriation account

Benji Nicka
8,200
16,000 14,000
5,000
13,029 8,686

29,029 35,886
21,429 31,371

with the factory, raw materials and WIP)

37,000

112,300
149,300
(29,600)
119,700
30,240
149,940
 362,810
512,750
31,200
543,950
(36,500)
507,450

507,450
40,000

$ 12.69
Per uniform
es and share of Profits
 House and Home
Statement of Financial position
as at 31 December 2016
$ $
Non Current Assets Non Current Assets
Ships 180,000 Ships
Loading Equipment 93,000 Loading Equipment
Total NCA 273,000 Total NCA

Current Assets Current Assets

6 month Investment 12,000 6 month Investment
Acc Rec 42,000 Acc Rec
Prepayment 15,000 Prepayment
Cash 18,000 Cash
87,000

Current Liabilities Current Liabilities

Acc Payable 61,000 Acc Payable
Bank Od 8,000 (69,000) 18,000 Bank Od
291,000 Working Capital
(90,000)
201,000
Financed by: Financed BY:
House Capital (2/3 x $201) 134,000 House Capital
Home Capital (1/3 x $201) 67,000 Home Capital
201,000
Add Long Term Liability
5% Three year loan from Warren Ba

Current account
House Home 2016 House Home
31-Dec Drawings 20,000 10,000 1-Jan Balance b/d 34,000 60,000
31-Dec Int On Dra 1,600 800 31-Dec Investment inc 10,000 10,000
31-Dec Balance c/ 38,400 85,200 31-Dec Salaries - 18,000
31-Dec Share of Profits 16,000 8,000
31-Dec Balance c/d
60,000 96,000 60,000 96,000
Balance b/d 38,400 85200
 $ $

180,000
93,000
273,000

12,000
42,000
15,000
18,000
87,000

61,000
8,000 (69,000)
18,000
291,000

134,000
67,000
201,000
g Term Liability
year loan from Warren Bank 90,000
291,000

House Current a/c

31-Dec Drawings 20,000 1-Jan Balance b/d 34,000
Int On Drawings 1,600 31-Dec Inv Inc 10,000
Balance c/d 38,400 Share of Profits 16,000
60,000 60,000
Balance b/d 38,400

Home Current a/c

31-Dec Drawings 10,000 1-Jan Balance b/d 60,000
Int On Drawings 800 31-Dec Salaries 18,000
Inv Inc 10,000
Balance c/d 85,200 Share of Profits 8,000
96,000 96,000
Balance b/d 85,200
Name of Business NOTHING TO DO WITH THE OFFICE IS HERE
Manufacturing Account (everything to do with the factory, raw materials and WIP) NOTHING concerning FINISH
For the year ended 31 December 2021

$ $ $ Direct cost is a cost that can

All Direct cost are added and
Opening stock of raw materials X
Purchases of raw materials x
Add carriage in/transport of raw materials x
Less returns out of raw materials -x
Net purchases of Raw materials x
Cost of raw materials available for use X
less closing stock of raw materials -x
Cost of raw materials consumed/used x Must
Direct Labour/Manufacturing Wages x
Other Direct Cost x
Royalties/Lic Fees ( per unit produced) x
Prime Cost (sum of all direct cost ie Raw materials used, direct labour and ro x

Factory Overheads: (All other cost incurred in the factory that CANNOT be traced to a finished unit)
Factory cleaners/washers salary x
Factory Supervisor salary x
Factory Electricity x
Add owing/Less prepaid x x
Factory Rent 4000
Factory Machinery Depreciation x
Indirect Materials x x
x (sum of prime cost and factory overhea
Add opening work in progress x
x
Less Closing work in progress -x
Cost of goods manufactured x

Cost of 1 unit Cost of goods manufactured

No of units produced

Balance Sheet:

Current Assets
Inventory- Raw Materials
WIP
 Finished Goods

Income Statement

Sales x
Less Ret IN -x
Net Sales x

COST OF GOODS SOLD:

Opening stock of Finished goods x
Cost of Goods Manufactured x
Purchases of Finished goods x
Cost of goods available for sale x
Less closing stock of finished goods -x
Cost of goods sold -x
Gross Profit x

Less Expenses ( ONLY OFFICE EXPENSES)

 NOTHING concerning FINISHED GOODS

Direct cost is a cost that can be traced to the finished unit

All Direct cost are added and is called Prime Cost

1st Adjustments - accruals (add) and Prepayments (subtract)

2nd Apportionment - split a cost between the factory and the office

Rent paid was $8000 but $2000 is still owing.

Apportion the rent 2/5 the factory and 3/5 to the office

Paid 8,000
rime cost and factory overheads) Accrual 2,000
10,000

Factory 4,000
Office 6,000
Partnerships General Partner

2 -20 owners
Unlimited liability -normal
Some owners enjoy limited liability but at least ONE partner must remain with unlimited liability

Mutual Agency- where any owner acting as an agent on behalf of the partnership can bind all other partners to agreements m

Partnership Agreement
-share of profits
-Salary
-Interest on Capital
-Interest on drawings
- what happens on admission of a new person
- what happens on death or retirement of a partner

If there is NO PARTNERSHIP AGREEMENT or it is silent on any point:

Partnership Act of 1890 will be enforced
Equal share of profits
No one will get a salary
no one will get interest on capital
no one will be charged interest on drawings

Name of Business
Income Statement /Trading and Profit and Loss account Nominal accounts - revenues and expenses
for the period ended……..
$ $ $
Sales X
Less Sales Returns/ Return Inwards -X
Net Sales X

Cost Of Goods Sold: Trading Account

Opening Stock X
Purchases X
Add Carriage In X
Less Returns Outwards/ Purchases Returns -X
Net Purchases X
Cost of goods available for sale (op stock + Net Purchases) X
Less Closing stock -X
Cost of goods sold X
Gross Profit (Sales less cost of goods sold) X
Add Other Revenue: (credit side of the Trial Balance)
Discounts Received X
Rent Received X
Decrease in Provision for doubtful debts X Profit and Loss Account
(decrease year over year) X
Less Expenses
Discounts Allowed x
Rent x Incurred - obligation to pay
Add owing x x

Electricity X
less prepayment -X X
Salaries and Wages X
Loan Interest (DOES NOT MATTER WHO ITS FROM) X
Increases in Provision for doubtful debts X
Provision for depreciation X X
Net Profit/Net Income X Stop here for sole trader

For Partnerships move into the following appropriation account:

(check what the period the appropriation account is being prepared)
Net Profit after loan interest (50 000 -2 000) 48,000
Add Interest on drawings (prorate if necessary)
Partner A (5% x $3 000x 6/12) 75
Partner B (5% x $2 000 x 9/12) + (5% x $3 500x 3/12) 119 194
48,194

LESS: Interest on capital: (% x capital balances)

Partner A (10%x $100K) 10,000
Partner B (10% x $150k) 15,000 25,000

Salaries: (check if the salary given is per annum or per month)

Partner A ($200 x 12) 2,400
Partner B ($300 x 12) 3,600 6,000
(31,000) (sum of salaries and interest on capital)
17,194 this figure is what is split in the P&L sha
Share of profits
Partner A (17194/2) 8,597
Partner B (17194/2) 8,597
17,194

Two ways to maintain capital:

Fixed Capital System Two accounts for every owner …capital acc(the owner's original investment)
Current account ( follows the same double entry rules as the capital acc
 Drawings (take from the question)
Int on drawings
Int on Capital take from the appropriation
Salaries
Share of Profits

Fluctuating Capital System One account for every owner - capital account (the owner's original investment plus drawings
 distinguishing features

her partners to agreements made with external parties.

revenues and expenses

Trading Account

Expenses by Function:
 Profit and Loss Account Selling and Distribution
Sales Commission
Expenses by Nature Advertising
Dep of Delivery Van
Incurred - obligation to pay Carriage Outwards

Administrative:
Office Rent
Office Electricity
General Manager Salary

Finance:
Loan Interest
Stop here for sole trader

Net Income BEFORE loan interest 50000

Loan Interest 2000

Any time you see dates the owners took drawings ..you MUST pro rate

Interest on drawings was 5% per annum

Partner A drawings $3,000 1-Jul-21 Year 1 Jan - 31 Dec
Partner B drawings $2,000 1-Apr-21 9mth
Partner B drawings $3,500 30-Sep-21 3 mths

Charge interest on drawings from the time the drawings took place to the end
of financial year

alaries and interest on capital)

is what is split in the P&L sharing ratio

investment)
e entry rules as the capital account)..to increase do a CR, to decrease DR) A
Balance c/ 100,000
the question)

take from the appropriation

Debit balance on the curre

more than he was entitled

inal investment plus drawings, int on drawings, int on capital, salaries and share of profits)

A
Drawings 5,000
Int On Dra 250
Balance c/ 103250

108,500
 Capital account Current account
B A B A B
150,000 Balance b/d 100,000 150,000 Drawings 5,000 7,000
 Int On Dra 250 350
Balance b/d 100,000 150,000 Balance c/ 4,250

9,500 7,350
Debit balance on the current account indicated that B withdrew Balance b/d 2,050
more than he was entitled to

Capital account
B A B
7,000 Balance b/d 100,000 150,000
350 Int On Capital 1,500 800
147450 Salaries 3,000 -
Share of Profits 4,000 4,000
154,800 108,500 154,800
Balance b/d 103,250 147,450
 take thes figures from the question
take thes figures from the appropriation account

Current account
A B
Balance b/d 1,000 500
Int On Capital 1,500 800
Salaries 3,000 -
Share of Profits 4,000 4,000
Balance c/d 2,050
9,500 7,350
Balance b/d 4,250 A credit Balance indicated that A did not withdraw all
he was entitled to
Name of business
Balance Sheet format( Permanence or liquidity)
As at ______________________________________

$ $ $
Permanence (amount from Trial Balance add Income
(cost - acc
statement
dep) amount)
Non Current Assets Accumulated
Cost Depreciation
Net Book Value

Land & Buildings X X X

Machinery X X X
Fixtures & Fittings X X X
Motor Vehicles X X X
IT equipment X X X
Total non current assets X

Current Assets
Inventory ( from the notes after T.B) X
Accounts Receivable x
less provision for doubtful debts (take % given x AR b -x X
Prepayments X
Bank X
Cash X
Total current assets x

Current Liabilities
Accounts payable X
Accruals/outstanding/ owing X -X
Working Capital (net Current assets) calculated by taking CA - CL) X
Non current assets plus working capital X
Less long term liabilities -X
X

Financed by: Adam Barry Total

Capital Accounts 50,000 100,000 150,000
Current Accounts:
Opening Balance (500) 2,000
Add: Add
Salaries 3,000 2,000 Credit side of the current account
Interest on Capital 5,000 3,000
Share of profits 12,000 10,000
19,500 17,000
Less: Less
Drawings (5,000) (3,000) Debit side of the current account
Interest on drawings (500) (300)
Closing balance 14,000 13,700 27,700
 177,700

OR (if another part of the question asked for the current account then do the following:)

Financed by: Adam Barry

Capital Accounts 50,000 100,000 150,000
Current Accounts 14,000 13,700 27,700
177,700
de of the current account

e of the current account

 ASSET
GENERAL LEDGER
Sales Ledger Control Account/Total Debtors accounts/ Total accounts receivable account
1-Jan Debit Balance b/d X 1-Jan Credit balance b/d x
31-Jan Credit sales X 31-Jan Cash/bank X
31-Jan Interest on late payment X 31-Jan Returns Inwards X
31-Jan Refund to customer X 31-Jan Bad debts X
31-Jan Dishonoured cheque x 31-Jan Discounts allowed X
31-Jan Set off X
31-Jan Credit balance c/d X 31-Jan Debit Balance c/d X

1-Feb Debit balance b/d X 1-Feb Credit balance b/d X

Dishonoured chequeA cheque received from a customer that was deposited with our bankers but has been
returned to us with no money being entered in our bank account

Customer gave the cheque DR Bank

Cr customer

Bank dishonoured cheque DR Customer

CR Bank

Liabilities
GENERAL LEDGER
Purchases Ledger Control Account/Total Creditors accounts/ Total accounts payable account
1-Jan Debit Balance b/d X 1-Jan Credit balance b/d x
31-Jan Returns Outwards X 31-Jan Credit Purchases X
31-Jan Discount Received X 31-Jan Interest on late payment X
31-Jan Cash/bank X 31-Jan Refunds from supplier X
31-Jan Set off X
31-Jan Credit balance c/d X 31-Jan Debit Balance c/d X

1-Feb Debit balance b/d X 1-Feb Credit balance b/d X

but has been