SUBSCRIPTION ACCOUNT

Date Details $ Date Details $

1 Jan 2023 Balance b/d 480 1 Jan 2023 Balalnce b/d 610
31 Dec 2023 INCOME & 11975 31 Dec 2023 Bank/ Cash 11950
EXPENDITURE
Irrecoverable ?????
Subsc
31 Dec 2023 Balance c/d 570 31 Dec 2023 Balance c/d 465
13025 13025

1 Jan 2024 Balance b/d 465 1 Jan 2024 Balance b/d 570

1 Jan 2023 31 Dec 2023

Bank / Cash (A+)

Subsc (i+)

Expense (E+) Insurance 7390

Bank / Cash (A-) Bank 7390

Date Details $ Date Details $

1 Jan 2023 Balance b/d 240 3 1Dec 2023 Income & 3690
Asset Expensditure
31 Dec 2023 Bank / Cash 7390 Shop Income 3690
Statemnent

31 Dec 2023 Balance c/d 250

7630 7630

Jan Balance b/d 250

Asset
 TRADE PAYABLES

Date Details $ - Date Details $ +

Bank / Cash 23290 1 Jan 2023 Balance b/d 2140
Shop Income ????? 23620
Statement

Balance c/d 2470

25760 25760

1 Jan 2024 Balance b/d 2470

Trade Payable (L-) 23290

Bank (A-) 23290

SHOP INCOME STATEMENT

Details $ $
Shop Sales 31890
Less: COST OF SALES
Op Inv 2500
Add: Purchases 23620
Less: Closing Inventory (2750)
23370
Add: Shop Expenses - Shop Wages 3268
(26638)
Profit from Shop 5252

INVENTORY (Asset)

Date Details $ + Date Details $ -

1 Jan Balance b/d 5811 31 Dec INCOME 5811
(opening Inv) STATEMENT

31 Dec INCOME 6275 31 Dec Balance c/d 6275

STATEMENT (Closing
Inventory)

1 Jan 2024 Balance b/d 6275

CAPITAL (LIAB)

Date Details $ - Date Details $ +

31 Dec Drwaings : Cash Xxxxxx 1 Jan Balance b/d (Op
Goods xxxxx BAl)
31 Dec Profit for the
year
 31 Dec Balance c/d (Cl 31 Dec Bank / Cash /
Bal) NCA

INCOME STATEMENT

Date Details $ Date Details $

EXPENSES - INCOMES +
Opening Inv Closing Inventory
Disposal 750
700

(Op + Pur – Clo) = COST OF SALES

Sales - (+op + pUr - Clo)

Trader = CASH BOOK Cash , Bank

Bank = BANk STATEMENT

Balance as per Cash BOOK (Bank ) is not equal to Balance as per BANK STATEMENT

Then a trader prepares BRS

Steps :

1. Compare Cash BoOk (Bank column) with the Bank Statemnt.

2. Mark the difference.
3. Prepare Updated CASh Book (UCB)
I Error in the cash book = UCB
Ii There in the BS But not in the cash Book = UCB
4. Balance UCB
5. Prepare BRS
I Error in Bank Statement = BRS
Ii There in Cash Book but not in BS = BRS

Transactions appear on the opposite side in the cash book and the bank statement
CASH BOOK Dr = BS Cr
CASH BOOK Cr = BS Dr

UPDATED CASH BOOK

Date Details $ Date Details $

May 1 Balance b/d 2834 May 1 Correction of 9
Error
Dividend 150 Bank Charges 95
Balance c/d 2880
2984 2984
May 1 Balance b/d 2880

BANK RECONCILIATION STATEMENT

Details $ $
Balance as per UCB 2880
Less: Cheque Deposited but not yet credited
ABC Stores 217
Sales 1460
(1677)
Add: Cheque Issued not yet presented
Tee dee 1372
Dhobhal 517
1889
Balance as per Bank Statement 3092
Details $ $
Balance as per Bank Statement 3092
Add: Cheques Deposited but not yet Credited
Sales 1460
ABC STores 217
1677
Less: Cheques Issued not yet presented
Tee Dee 1372
Dhobal 517
(1889)
Balance as per UCB 2880
 STATEMENT OF FINANCIAL POSITION as at 31 Dec

DETAILS $ $ $
NON CURRENT ASSETS COST Prov For Dep NBV
Building
Equipments
Furniture & Fixtures
Motor Vehicle
TOTAL NCA
CURRENT ASSETS
Closing Inv Xxx
Trade Receivable – PFDD Xxx
Other Receivable Xxx
Bank Xxx
Cash Xxx
Petty Cash xxx XXX
TOTAL ASSETS ===

CAPITAL & LIABILITIES

Opening Capital Xxx
Add: Capital Invested Xxx
Add: Profir for the year Xxx
Less: Loss for the year (xxx)
Less: Drawings (Cash + GFOU) (xxx)
XXX
NON CURRENT LIABILITY – LOAN Xxx
CURRENT LIABILITY
Trade Payable Xxx
Other Payable Xxx
Short Term Loan Xxx
Bank Overdraft Xxx
Xxx
TOTAL CAPITAL & LIABILITIES ====

SALES RETURN

Total 3524

PURCHASES

Totals 3524
Purchases E 3524

Sales Ret 3524

Suspenses 7048

Purchases 90

Suspense 90

Suspense 19415

Sales 19415

SALES

Totals Cr Sales 19415

for the month

Cash (A+)

P Mattel /

M Patel

Suspense 238

P Mattel 129

M Patel 129

Suspense 5000

Capital (L+) 5000

Rent (E+) 50

Bank / Cash (A-) 500

Rent 450

Suspense 450

SUSPENSE

DATE DETAILS $ DATE DETAILS $

Sales 19415 Purchases 3524
Capital 5000 Sales Return 3524
M Patel 129 Purchases 90
P Mattel 129 Rent 450
Difference in 17085
Trial Balance

SALES
- SALES RETURN
Net SALES
(COS)
op
Pur ++++
-Cl
GROSS PROFIT

ORIGINAL GROSS PROFIT 66223

Purchases (3524)
(3524)
(90)
19415
CORRECTED GROSS PROFIT 78500
1 May 2021 12000

25% RBM

1 May 2021 30 Apr 2022 25% 12000 = 3000

1 May 2022 30 Apr 2023 25 % * (9000) = 2250

TOTAL 5250

1 May 2023 30 Apr 2024

DISPOSAL

30 April 2024 MOTOR VEHICLE 12000 Prov For 5250

(COST) DEpreciation
Y Limited 6000
INCOME 750
STATEMENT
(Loss)

12000 12000

Y Limited (A+) 6000

Disposal 6000

TYPE QTY COST Carriage TC Selling Selling NRV LOWER VALUE

Inwards Price Expenses OF
COST &
NRV
A 100 10 1 11 15 2 13 11 11 * 100 =
1100
B 200 25 2 27 30 4 26 26 26*200=5200
C 100 30 5 35 39 3 36 35 35*100=3500
D 50 50 0 50 60 12 48 48 48*50=2400
TOTAL 12200
 Date Details $ Date DETAILS $
1 May 2023 Balance b/d 60 30 April 2024 INCOME 360
STATEMENT
1 Aug Bank 360
30 April 2024 Balance c/d 60
420 420

1 May 2024 Balance b/d 60

Insurance (E +)

Bank A-

May Jun Jly aug Sep Oct Nov Dec Jan Feb Mar Apr May June

Prepaid 360 / 12 = 30 * 2 = 60 Prepaid

MANUFACTURING ACCOUNT for the year ending

Details $ $
COST OF RAW MATERIAL CONSUMED
Opening Inventory Xxx
Purchases of Raw Material Xxx
Less: Purchase return of Raw Material (xxx)
Add: Carriage Inwards Xxx
Less: Closing Inv of Raw Material (xxx)
COST OF RAW MATERIAL CONSUMED XXX
Add: Direct Labour / Direct Wages/ Factory Operatives Xxx
Add: Direct Expense : Royalty Xxx
PRIME COST ===
Add: FACTORY OVERHEADS
Factory Rent Xxx
Factory Supervisor Salary Xxx
Factory Insurance Xxx
Factory Machinery Depreciation Xxx
Factory Indirect Wages Xxx
Depreciation On LOOSE TOOLS Xxx
XXX
===
Add: Opening Inventory of Work In Progress Xxx
Less : Closing Inventory of Work In progress (xxx)
COST OF PRODUCTION OF FINISHED GOODS =====

COST OF PRODUCTION = DIRECT COST (Prime Cost) + Indirect Cost ( Factory Overheads)
Raw Material + Direct LAbour/ Direct wages / Factory Operative + Direct Expenses

SALES (I)

Total Cr Sales for 3416

the month

SALES RETURn (I-)

Totals for the 3416

month

INSURANCE

Bank Double

DISCOUNT ALLOWED

Totals for the 47

month

DISCOUNT RECEIVED (I )

47 Totals for the 47

month

Disc Allowed 47

Disc Recd 47
 Suspense 94

Office EquipA+

Stationery

SUSPENSE ACCOUNT

Difference in 385 Insurance 230

trial Balance
Purchase 90 Disc Allowed 47
Disc Recd 47
Balance c/d ??? 151
475 475

Sales return (I-) Profit -----

Sales (I +++) = Profit +

Insurance E ++++ =

Suspense

Office equip A+

Stationery E --- = Profit +

Disc Allowed E + = Profit -

Disc Reced I - = Profit ---

Suspense

Suspense 90

Purchase E - = Profit +

Profit for the year + - 17420

ERROR 1 No Effect No Effect
INSURANCE 230
ERROR 3 94
Error 4 52
Error 5 90
 142 324 (182)
Corrected profit 17238

Sales +++
Less: Sales return +++
NET SALES ---
LESS: COST OF SALEs
Op Inv
Purchases
Less: Closing Inv

INCOME STATEMENT

Details $ $
Sales Revenue Xxx
Less: Sales return (xxx)
NET SALES ===
Les: COST OF SALES
Opening Inventory Xxx
Add: Purchases Xxx
Les: Purchase Return Xxx
Add: Carriage Inwards Xxx
Less: Goods for own Use (xxx)
LessL Closing Inventory (xxx)
(XXX)
GROSS PROFIT ===
Add: Other Incomes
Rent Received Xxx
Commission Received Xxx
XXX
+++
Less: Other Expenses
Rent Payable Xxx
Salary Xxx
Depreciation Xxx
Utility Bills Xxx
Wages Xxx
(XXX)
PROFIT FROm OPERTAIONS ===
Less: FINANCE COST
Interest on Loan Xxx
INTEREST ON PARTNER’S LOAN (INCOME STATEMENT Xxx
of Partnership)
(XXX)
PRFIT FOR THE YEAR ===
 TRADE RECEIVABLE CONTROL ACCOUNT / (SALES LEDGER CONTROL ACCOUNT

+ -
1 Jan Balance b/d 4830 1 Jan Balance b/d xxxx
31 Jan Cr Sales 5810 31 Jan Sales Returns 64
Balance c/d 101 Bank/ Cash 4365
Interest Disc Allowed 135
Inter Ledger/ 212
CONTRA ENTRY
Balance c/d ????
TOTAL TOTAL
Mar Balance b/d 101

TRADE PAYABLE CONTROL ACCOUNT / PURCHASE LEDGER CONTROL ACCOUNT

- +
Feb 1 Balance b/d xxx Feb 1 Balance b/d 3490
Feb 28 Purchase return 42 28 Feb Cr Purchases 3920
Bank / Cash 2925
Discount 75
Received
CONTRA ENTRY / 212 Balance c/d 46
INTER LEDGER
Balance c/d ???? Bal fig 4202
TOTAL 7456 TOTAL 7456
1 Mar Balance b/d 46

LEDGERS ARE DIVIDED INTO THREE PARTS

Sales Ledger Purchase Ledger Nominal Ledger

TR Account TP Account , Assets,Sales, Purchase, Sales Ret, Purch Ret, Incomes,

STEPS TO PREPARE BANK RECONCILIATION STATEMENT

1 Compare the cash Book (Bank Column) with the Bank Statement

2 Mark the differences

3 Prepare Updated Cash Book (UCB)

1 BS = Yes But CB = No UCB

2 Error in The cash Book UCB

4 Balance UCB

5 Prepare BRS

CB = Yes But BS = No BRS

Error In Bank Statement BRS

DATE DETAILS $ DATE DETAILS $

Dividend 262 Balance b/d 1668
received
Correction of 100 Bank 38
Error Charges
Balance c/d 1344
TOTAL TOTAL
1 May Balance b/d 1344

BANK RECONCILIATION STATEMENT as at 1 May

Details $ $
Balance as per UCB (1344)
Add: Cheque not yet presented – Peter 344
Add: Correction of Error 50 394
Less: Amount not yet Credited – Sales 650 (650)
Balance as per Bank Statement (1600)

ACCOUNT - DISCOUNT = AMOUNT

250 - (4% *250) = 250 -10 = 240

250 - ??? = 240 (96 %)

240 / 96 *100 = 250

Disc = 250 -240 = 10

1. Shaurya (Seller) = Issue INVOICE to KAVISH Invoice receive

Credit Sales Credit Purchase

 2. Kavish = Issue DEBIT NOTE (REQUEST) Shaurya Receive
For Returning Faulty GoodsSO NO ENTRY IN BOOKS OF ACCOUNTS

3. Shaurya Issue a CREDIT NOTE to (Acceptance) Kavish

SALES RETURN PURCHASE RETURN

4. Kavish Pay Cheque (CHEQUE COUNTERFOIL)

Shaurya Receipt Issue

Shaurya Deposit Bank (PAY IN SLIP)

5. SHAURYA WILL ISSUE A STATEMENT OF ACCOUNT

Summary of Transactions in a month
Reminder to the customer to pay the Account

TYPE QTY Cost Carriage TOTAL Selling Selling NRV (C LOWER VALUE of
A Inwards COST Price C Expense – D) OF INVENTORY
B (A+B) D COST
& NRV
Paper 240 4.5 0 4.5 8 0 8 4.5 4.5 * 240 =
1080
Envelope 225 5.5 1 6.5 10 1.5 8.5 6.5 6.5 * 225 =
s 1462.5
Notepads 150 4 2 6 5 0 5 5 5*150= 750
Pencils 96 3.5 0 3.5 6 0 6 3.5 3.5*96=336
TOTAL 3628.5

INVENTORY IS VALUED AT LOWER OF COST & NET REALISABLE VALUE Following PRINCIPLE OF PRUDENCE

ASSETS = CAPITAL + LIABILITY

NON CURRENT ASSETS + CURRENT ASSETS = CAPITAL + NON CURRENT LIABILITY + CURRENT LIABILITY
 STATEMENT OF FINANCIAL POSITION as at

Details $ $ $
NON CURRENT ASSETS COST Prov For DEP NBV
Building / Premises Xxx Xxx ===
Equipment Xxx (xxx) ===
Furniture & Fixture Xxx (xxx) ===
TOTAL NON CURRENT ===
ASSET
CURRENT ASSET
Closing Invenory Xxx
Trade Receivable Xxx
Other Receivable Xxx
Bank xxx
Cash Xxx
Petty Cash Xxx
XXX
TOTAL ASSETS ====
CAPITAL & LIABILITY
Capital Op Balance Xxx
Add: profit for the year Xxx
Less: Drawing (xxx)
Add: Capital Introduced Xxx
XXX
NON CURRENT LIABILITY- XXX
Loan
 CURRENT LIABILITY
Trade Payable Xxx
Other Payable Xxx
Bank Overdraft Xxx
Short Term Loan Xxx
XXX
TOTAL CAPITAL & ===
LIABILITIES

WAGES ACCOUNT

Date Details $ Date Details $

1 Jan Balance b/d xxx 1 Jan Balance 1300
(Prepaid of 2021 b/d(Accrued of
previous YEar ) Previous Year)
31 Dec Bank / Cash 68000 INCOME 68250
STATEMENT
31 Dec Balance c/d 1550 Balance c/d xxx
69550 69550
1 Jan Balance b/d xxx 1 Jan Balance b/d 1550
2022 2022
Oct Nov Dec 2020 2021Jan Feb Mar Apr May Jun Jly Aug Sep Oct Nov Dec2021 Jan Feb 2022

Expense ( E+)

Bank A-

INSURANCE

Date Details $ Date Details $

1 Jan Balance b/d 1140 1 Jan Balance xxx
(Prepaid of 2021 b/d(Accrued of
previous YEar ) Previous Year)
31 Dec Bank / Cash 2400 INCOME Xxx
STATEMENT (Balancing
figure)
31 Dec Balance c/d xxx Balance c/d xxx
TOTAL TOTAL
1 Jan Balance b/d xxx 1 Jan Balance b/d xxx
2022 2022
 INCOME ACCOUNT

Date Details $ Date Details $

Balance b/d xxx 1 Jan Balance b/d Xxx
(Accrued of 2021 (Prepaid of
Previous YEar ) Previous Year)
INCOME ???? Bank / Cash xxxx
STATEMENT
31 Dec Balance c/d xxx 31 Dec Balance c/d xxx
TOTAL TOTAL
1 Jan Balance b/d xxx
1 Jan Balance b/d xxx
2022
Oct Nov Dec 2020 2021Jan Feb Mar Apr May Jun Jly Aug Sep Oct Nov Dec2021 Jan Feb 2022

Bank / Cash (A+)

Rent Received (I+)

CASH BOOK = Cash & Bank Transaction

PETTY CASH BOOK = Petty Expenses

SALES JOURNAL = Credit Sales

Purchase Journal = Credit Purchase

SALES RETURN JOURNAL = Cr Sales Return

PURCHASE RETURN JOUNAL = Cr Purchase Return

GENERAL JOURNAL = That doesn’t find any place in either of the books above = JOURNAL ENTRY

SALEs JOURNAL (Cr Sales)

Date Details / Name $ $

of Customer
1 Jan Naisha 1000
Less: Trade Disc (100) 900
10%
3 Jan Himanshi 2500
Less: Trade Disc (500) 2000
20%
7 Jan Kavish 5000 5000
31 Jan / 7 Jan TOTAL CR SALES 7900
transferred to
Sales Account

PURCHASE JOURNAL

Date Details / Name Inv No.Received $ $

of Supplier
1 Jan Shaurya Inv 5000
Less: 20% Trade (1000) 4000
Discount
5 Jan Aarush Inv 4000
Less: Trade Disc (400) 1600
10%
7 Jan Total Cr 5600
Purchase for the
week
transferred to
purchase
Account
SALES ACCOUNT

7 Jan Total Cr 7900

Sales for the
week

PURCHASE ACCOUNT

7 Jan Total CR 5600

Purchase for
the month

P&L Appropriation Account for the year ending

Details $ $
Profit for the Year XXX
Add: Interest on Drawing
A (XXX *%) Xxx
B (xxx * %) Xxx
XXX
+++
Less: Interest on Capital

A (xxx *%) Xxx

B (xxx * %) Xxx
(xxx)
Less: Salary
A (XXX)
 RESIDUAL PROFIT ===
Divided Between (5:3)
A (RP * 5/8) Xxx
B (RP * 3/8) Xxx
====

CAPITAL ACCOUNT (permanent Investment) L

DATE DETAILS A - B- Date DETAILS A+ B+

1 July Bank(Withdrawn xxx 1 Jan Balance Xxx xxx
) b/d
1 July Bank / xxx
Building
31 Dec Balance c/d Xxx xxx
TOTAL TOTAL TOTAL TOTAL
1 Jan Balance xxx xxx
b/d
PARTNER’S CURRENT ACCOUNT (Yearly Adjustment)

DATE DETAILS A - B- Date DETAILS A+ B+

1 Jan Balance Xxx Jan 1 Balanceb/d Xxx
b/d 500 1000
Drwaings 800 1000 31 Dec INTEREST 500 700
ON
CAPITAL
31 Dec Interest 400 400 Salary 750
on
Drawings
Balance Profit 1200 1200
c/d Share
TOTAL TOTAL TOTAL TOTAL

OpeninBal of Retained Earnings = xxx

Add: PFTY =xxx

Less: Interim Dividend =xxx

Less: Final Dividend = xxx

Less: Tansfer to Gen res =xxx

Closing Bal =XXX

GROSS MARGIN = GP / NET SALES * 100

(SALES - COST OF SALES) / NET SALES *100

[97000 - (5200 + 51300 – 6500)] / 97000 *100

47000 / 97000 *100

48.45%

PROFIT MARGIN = PFTY / NET REVENUE *100

(GROSS PROFIT – EXPENSES ) / Net SALES *100

(47000 – 23750 )/ 97000 *100

23250 / 97000*100

23.97%

ROIT = COS / AVERAGE Inventory

50000 /[ (5200 + 6500) /2]

50000 / 5850

8.55 times

TRADE RECEIVABLE TURNOVER = TR / CREDIT SALES *365

9550/86400 *365
41 Days

LIQUID RATIO = CURRENT ASSETS - INVENTORY / CURRENT LIABILITIES

DISPOSAL

Date Details $ Date Details $

NCA COST PFD Acc Dep
LAST INCOME PROFIT BANk/ Cash / xx
DATE STATEMENT REceivablexxx
INCOME STAT LOSS

Bank / Cash / Receivable

DISPOSAL

Date Details $ Date Details $

BAL b/d Disposal COST

Date Details $ Date Details $

DISPOSAL xx Balance b/d xxx
 TRADE PAYABLE

Date Details $ Date Details $

Bank 34250 Bal b/d Xx 000
Purchases ???? 37210
Bala c/d 2960

TOTAL TOTAL
Balance b/d 2960

MARK UP = GP is % of COS

GP is 32 % of COS

(PURCHASES – CL INV) 32 % * 68000 = 21760

GP + COS = sales

21760 + 68000 =

SALES JOURNAL

Date Details $ $
2 Apr Ava 150
Less: TRADE 9 141
DISCOUNT 6%
12 April NURU 165
21 April Mahia 480
Less: TRADE 24 456
DISCOUNT5%
30 April TOTAL Cr SALES 762
TRANSFERRED
to Sales
 Account

PROFIT MAKING BUSINESS CLUBS & SOCIETIES

Profit Service
Cash Book (Cash & Bank) Receipts & Payment (Bank ) Opening
Balance , Closing Balance
INCOME STATEMENT (Service Business) INCOME & EXPENSDITURE (INCOMES
LESS EXPENSES (Accrual BASIS)
Profit for the year Surplus
Loss for the year Deficit for the year
CAPITAL Accumulated fund (Surpluses that gets
on accumulated over years)

1. Receipts & Payment

RECEIPTS PAYMENT
Revenue Revenue Exp &
Receipts & Capital Exp
Capital Receipts
OPENINg Closing BAlance
BALANCE

2. SHOP INCOME STATEMENT

SALES RVENUE xxx

Less: COST OF SALES xxx
 Add: SHOP EXPENSES xxx
(TOTAL COST)
PROFIT FROM SHOP XXX

INCOME & EXPENDITURE

INCOMES
Subscription 50000
NEW YEAR PARTY 100000
Less: Expenses (55000) 45000
95000
Less: Expenditure
Various Exp 12000
Ground Event Rent 80000
Less: Event Exp 100000 20000

DATE DETAILS $ DATE DETAILS $

1 Jan BALANCE b/d Accrued of PY Jan Balance b/d Prepaid of PY
31 Dec INCOME & Bank / Receipts AMOUNT
EXPENDITURE & Payments RECEIVED
Balance c/d Prepaid of CY Balance c/d Accrued of CY
TOTAL Irrecoverable
Subscription

1 Jan Balance b/d xxx 1 Jan Balance b/d xxx

BANK / RECEIPTS & PAYMENT

Subscription

STATEMENT OF AFFAIR = Format SOFP

STATEMENT OF AFFAIR as on 1 Jan

NON CURRENT ASSETS Total

Current Assets Total
 TOTAL ASSETS
CAPITAL & LIABILITIES
Cpaital1 Jan ????? Balancing Fig
NON CURRENT LIAB Xxx
CURRENT LIAB xxx
TOTAL LIAB

CLOSINg SOA

CAPITAL (L)

Drwaings xxxx Balance b/d Opening SOA

Income LOSS Bank / NCA xxx
Statement
INCOME PROFIT +++++
STATEMENT
Balance c/d Cl SOA

STATEMENT OF AFFAIR as on 30 Sep 2019

Details $
NON CURRENT ASSETS COST ACC DEP NBV
Premises 80000
Fixtures 7800 1170 6630
Motor Vehicle 10000 2000 8000
TOTAL NCA 94630
CURRENT ASSETS
Inventory (6350-510) 5840
Trade Receivable (6450 – 150 ) – (6300 *5%) 5985
Bank (6170 +10%) 6787
18612
TOTAL ASSETS 113242

CAPITAL & LIABILITIES

Capital ?????
NON CURRENT LIABILITY- Loan 7000

CURRENT LIAB
Short Term Loan 1 March 2020 7000
Trade Payable 6220 + 880 7100
Other Payable 260 14360
113242

MARKUP = GP as a % of COST OF SALES

Margin = GP as a % of Net Sales

COS MARK UP MARGIN GP SALES Let COS GP SALES

100000 25% 25000 125000
????? 30% 130000 100 30 130
100000
?????250000 20% 50000 300000 100 20 120
????200000 50% 100000 300000 100 50 150
??? 90000 25% 30000 120000
140000 30% ???? 60000 ???? 200000 70 30 100
225000 25% ???? 75000 300000 75 25 100

Let Sales = 100

Gp 25

COS = 75

COS : SALES

75 : 100

225000 : xxxx

130000 * 100 /130

225000 : xxxx

20000 : 300000

COS MARK UP MARGIN GP SALES Let COS GP SALES

400000 20% 80000 480000
300000 25% 100000 400000
200000 40% 80000 280000
250000 50% 250000 500000
160000 25% 40000 200000
180000 40% 120000 300000
 Revenue 40200
Less: Sales Return / Returns Inwards (200)
40000
Less: COSt OF SALES
Opening Inventory 2300
Add: Purchases 31600?????
Less: Purchase returns (400)
33500 (1)
Less: Closing Inventory ( c ) (3500)
(30000) ( b )
GROSS PROFIT (25% * 40000) (a) 10000

DETAILS $ $
Revenue 56700 (a )
Less: COS
Op Inv 3000
Add: Purchases ???? 48250 (c )
Less: Closing Inventory (4000)
47250
GROSS PROFIT ( b ) 9450
COS : SALES
100 : 120
47250 : XXX

Rate of Inventory Turnover = COS / (Average Inventory)

13.5 = COS / (3000 +4000/2)

13.5 = x / 3500

COS = 47250
 INCOME STATEMENT for the year ending….

Sales rev ????? 56700

Less: Sales return
Net SALES
LESS: COST OF SALES
Opening Inventory 3000
Add: Purchases ????? ???

Less CLOSING INVENTORY 4000

47250
GROSS PROFIT (20% * 47250) 9450

MARGIN = GROSS PROFIT is a % of Net sales Rev

MARK UP = GROSS PROFIT is 20% of COS

Rate of Inventory Turnover = COS / (Avergae Inventory)

13.5 = COS / (Op in + Cl Inv/2)

13.5 = COS / (3000 + 4000 /2)

13.5 = COS / 3500

COS = 13.5 * 3500

COS = 47250
DATE DETAILS $ DATE DETAILS $
1 Apr 2018 Capital 12800 1 Apr Fixtures 9500
Loan 7200 Suppliers 15000
Sales ??????? Rent for 6 2400
Months
Insurance 3600
30 April Operating exp 980
Wages 1900
Drawings 1500
Balance c/d ?????

INCOME STATEMENT for the month ended….

SALES REV ?????15640

Less: COST OF SALES
Op Inv 0000
Purchases (15000 + 810) 15810
Less: Closing Inv (4080)
(11730)
GROSS PROFIT 3910
Less: Other Expenses
OP exp 980
Wages 1900
Insurance (3600/12) 120
Rent (2400 / 6) 400
 Prov For Dep (9500*12% *1/12) 95
(3495)
PROFIT FROm OPERATIONS 415
Less: FINANCE COST INTEREST 7200 (30)
* 5% *1/12)
PROFIT FOR THE MONTH 385

Margin = GP as a % of NET SALES REVENUE

GP = 25% of Sales

SALES = 100

GP = 25

COS = 75

COS : SALES

75 : 100

11730 : X

Let COS = 100

Gp = 25

Sales =125

COS : SALES

100 : 125

X : 48000

COS = 48000 *100/125

COS = 38400

Mark Up = GP is a % of COS
COS = 100

Gp = 25

SALES = 125

SALES : GP

125 : 25

216000 : X

GP = 216000 *25 /125

Details $ $
Sales Rev 216000
Less: COST OF SALES
Opening Inv 19500
Purchases 176000
Less: Goods for Own Use (1900)
193600
Less: Closing Inventory (20800) c
(172800) b ?????
Gross Profit (216000 * 25 /125) 43200 a
Add: OTHER INCOMES
Debts Recovered 160
Reduction in provision for Doubtful Debts 372 – 20 180
(17600*2%) = (372 - 352) 2 MARKS
43380
Less: OTHER EXPENSES
Provision for Depreciation on Motor Vehicle 20% * 960
(6000 – 1200)= 4800 *20%
Provision for Depreciation on Equipment (3000 – 660
2340)
Bank Interest 1550
Prop Tax & Insurance 8900 – (2400 *4/16) 8300
Adm Exp 4410
Wages 28200
(44080)
LOSS For the year 700

TRADE RECEIVABLE ACCOUNT

+ -
Oct 1 2007 Balance b/d 5000 30 Sep 2008 Bank 58114
30 Sep 2008 Cr Sales ????? 60000 Discount 1186
Allowed
Irrecoverable 900
Debts
Balance c/d 4800
TOTAL65000 TOTAL 65000

1 Oct Balance b/d 4800

TRADE PAYABLE ACCOUNT L

- +
Bank 45930 1 Oct 2007 Balance b/d 4500
Disc Received 470 30 Sep 2008 Cr Purchases ?????47100
30 Sep 2008 Balance c/d 5200

TOTAL 51600 TOTAL51600

1 Oct 2008 Balance b/d 5200

INCOME STATEMENT for the year ended 30 Sep 2008

 Details $ $
Sales (Credit + Cash ) 60000
Less: COST OF SALES
Opening Inventory 7800
Add: Purchases 47100
54900
Less: Closing Inventory ?????? (4900) c
(50000) b
GROSS PROFIT (60000*20 /120) 10000 a

GP is 20% of COS

Let cos = 100

Gp = 20

Sales = 120

SALES: GP

120 : 20

60000: x

STATEMENT OF AFFAIR as on

Details $ $ $
NON CURRENT ASSETS 12000
CURRENt ASSETS 110000
TOTAL ASSETS 122000
CAPITAL & LIABILITIES
CAPITAL Balancing Figure ???? 96000
Non CURRENT LIABILITY 000
CURRENT LIABILITY 26000
TOTAL 122000

STATEMENT OF AFFAIR as on 31 Oct 2010

Details $ $ $
NON CURRENT ASSESTS 14000
CURRENt ASSETS (95500 – 94000
1500)
TOTAL ASSETS 108000
CAPITAL & LIABILITIES
CAPITAL ???? 84000
Non CURRENT LIABILITIES 0000
CURRENt LIABILITIES 24000
108000
 CAPITAL L

- +
31 Oct 2010 Drawings (7500 90000 1 Nov 2009 Balance b/d 96000
*12)
1 Jan 2010 Bank 50000
31 Oct 2010 Income 28000
Statement
(Profit)

31 Oct 2010 Balance c/d 84000

174000 174000

Let COS = 100

GP = 50

Sales = 150

COS : Sales

100 : 150

X : 210000 (CASH + CREDIT)

X =COS = 140000 = Op Inv + Purchases – Closing Inv

140000 = 21600 + x - 28800

X =purchases = 140000 -21600 +28800

Margin = Gp 40% of Net SALES

40 % = 40 % * 68900

GP = 27560

Net SALES - Gp = COS

68900 – 27560 = 41340

Op Inv + Purchases – Cl Inv = 41340

12450 + 36800 -2260 – x = 41340

41340 -12450 -36800 +2260 = CLOSINg INVENTORY

INCOME STATEMENT for the year ending 30 Sep 2006

Details $ $
Sales revenue 89500
Less: Sales Returns (1100)
Net SALES 88400
Less: COST OF SALES
Opening Inv 10260
Add: Purchases 65700
Less: Goods for Own Use (1260)
74700
Less: Closing Inventory (8400) c
(?????) 66300 b
GROSS PRFOIT (25% * 88400) 22100 a
Add: Discount Received 610
Bad debts Recovered 170
780
22880
Less: Other Expenses
(Administration Expenses
Increase in Provision for Doubtful 50
Debts 9000 *2% = 180 – 130
Provision for Depreciation on 405
Equipment (10% * (5000 – 950)
Provision for Depreciation on 550
Fixtures (7800 – 7250)
Adm Expenses 21215
Discount Allwed 600
Carriage outwards 210
(23030)
Loss for the year 150
 INCOME STATEMENT OF A LIMITED COMPANY

Details $ $
Sales Revenue xxx
Less: COST OF SALES (xxx)
GROSS PROFIT ===
Add: Other INCOMES Xxx
Less: OTHER EXPENSES (xxx)
Profit from Operations ===
Less: FINANCE COST
Interest on Bank Loan Xxx
Interest on Debentures Xxx
Dividend on Redeemable Pref Shares xxx
(xxx)
PROFIT FOR THE YEAR ===

STATEMENT OF CHANGES IN EQUITY

Details Share Capital General Reserve Retained Earnings TOTAL

Balance as on 1 Jan 500000 25000 30000 555000
Share Issue 50000 50000
Profit for the year 60000 60000
Transfer to General 10000 (10000)
Reserve
Dividends
Interim Dividend (15000) (15000)
Final Dividend (20000) (20000)
Clsing Balance as on 550000 35000 45000 TOTAL

EXPENSE

Date Details $ Date Details $

1 Jan 2022 Balance b/d Prepapid of PY 1 Jan 2022 Balance b/d Accrued of PY $
Bank / Cash Xxxx (for the INCOME 12 Months
time you have STATEMENT
paid)
31 DEc Balance c/d Xxxx Accrued 31 Dec Balance c/d Xxx Prepaid

TOTAL TOTAL
1 Jan 2023 Balance b/d xxx 1 Jan 2023 Balance b/d xxxx

INCOME

Date Details $ Date Details $

1 Jan Balance b/d (accrued of PY) 1 Jan 2014 Balance b/d (prepaid of PY)
300 420
INCOME Xxxx 6320 Bank/ Cash Xxxx6000
STATEMENT
Balance c/d Prepaid of CY Balance c/d (Accrued of CY)
500 400
Irrecoverable 300
TOTAL 7120 TOTAL 7120
1 Jan 2015 Balance b/d Xxx 400 Balance b/d Xxxx 500
 Oct Nov Dec2021 Jan 2022 Feb Mar Apr May Jun Jly Aug Sep Oct Nov Dec Jan Feb Mar

On receiving Income

Bank / Cash (A+)

Income (I+)

EXPENSE (E+)

Cash / Bank (A-)

Oct Nov Dec2021 Jan 2022Feb Mar Apr May Jun Jly Aug Sep Oct Nov Dec Jan Feb Mar Apr

Oct Nov Dec2021 Jan 2022Feb Mar Apr May Jun Jly Aug Sep Oct Nov Dec Jan Feb Mar

Date Details $ Date Details $

Jan 1 2014 Balance b/d 700 1 Jan 2014 Balance b/d 480
31 Dec 2014 Bank ( Rates 16) 2560 31 Dec 2014 INCOME 4220
 STATEMENT
31 Dec 2014 Bank (12) 2400
31 Dec 2014 Balance c/d 960
(2560 /16) +
(2400/12*4)
5660 5660
1 Jan 2015 Balance b/d (160 960
+800)

Date Details $ Date Details $

1 Jan Balance b/d 1 Jan 2014 Balance b/d
INCOME 1200 Bank/ Cash 800
STATEMENT
(4800 /12 *3)
Balance c/d Balance c/d 400
1200 1200

1 Jan 2015 Balance b/d 400 Balance b/d xxxx

4800 is the annual rent

Per month rent = 400

DISPOSAL

DATE DETAILS $ DATE DETAILS $

NON CURRENT COST Provision for Dep Acc Dep
ASSET
INCOME Bank/
STATEMENT - Receivable
PROFIT
INCOME
STATEMENT-
LOSS

70 35

DETAILS $ $ $
NON CURRENT ASSETS
Fixtures 20800
Motor Vehicle 12100
32900
 CURRENT ASSETS
Inventory 15900
TR – Irrecoverable Debts 8100
Other Receivable 400
Bank + Interest 1150
25550
TOTAL ASSETS 58450

CAPITAL & LIABILITIES

Op Cap 28400
Add Corrected Proit 28050
Less: Drawings (12000)
10000+2000
44450
CURRENT LIABILITIES
TP 14000
58450

WORKING CAPITAl = CURRENT ASSETS - CURRENt LIABILITIES

Right Entry Wrong Entry Rectifying Entry

Bank J Jones TR Bank D Bones TR D Bones J Jones

BANK CHARGES BANK 110 BANK CHARGES BANK 11 Bank Charges 99 Bank 99
110 11

Stationery E+ 35 Petty Cash Book Petty Cash BOOk Stationery 35 Stationery 70 Petty Cash Book
A- 35 70

Motor Vehicle Capital ------ ------ Motor Vehicle Capital

Stationery E Capital ------------- ------------- Stationery Capital

Drawings L- Purchases E- Drawings ------- SUSPENSE Purchases

Bank A+ Debts Recovered Bank SUSPENSE100 Irroverable

50Debts
Bad Debts Debts Recovered
Irrecoveraable 50
Debts
Current L- Capital L+

SUSPENSE ACCOUNT

Date Details $ Date Details $

Puchases 300 Diffrerence in 400
TRIAL BALANCE
Irrecoverable 50
Debts
Debts Recoevred 50

400 400

INCOME STATEMENT for the eyar ending

INCOMES
Fee from Clients (199500 204000
+4500)
Other Incomes 17300 221300
OTHER EXPENSES
Wages (98200 + 12600) 110800
General Expenses 36140
Insurance (3450/15 *12) 2760
Prov for Depreciation 8320
(65000 – 23400) * 20%
Prov for Depreciation 2700
(24000 * 10%) + (7200
*10% * 5/12)=2400+300
(160720)
Profit for the year 60580
CASH BOOK BANK COLUMN

Correction of 1000 Balance b/d 3420

error
Balance c/d 2940 PB Dishonoured 330
cheque
Bank Charges 190
 Balance b/d 2940

Balance as per UCB (2940)

Less: Cheque not yet Credited (1560)
Add: Cheque not yet presented 2700
Balance as per Bank Statement (1800)

SUSPENSE Xxx
TR xxx
(Bank transfer not recorded in Sarah’s account now
coreected)

Motor Vehicle / CAPITAL

CAPITAL / Vehicle Repairs

Motor Vehicle A 7000

Vehicle Repairs E 7000
Capital 14000
(Motor Vehicle credited to repairs and deboted to capital,
now corrected)
Purchaes E+ 270 / 207
Tarde Payable L+ 270

Purchases 63
Suspense 63

General Exp
Bank
Drawings L- Cap- 200
Cash 200

Cash 200
Drawings 200

Drawings 400
Cash 400

BANK CHARGES
Bank

CASH
SALES / Zahoor

ZAhoor
SAles

Purchases returns 10
Suspense 10

Date Details $ Date Details $

31 March Difference in 357
Trial BAlance
31 MArch Sarah 420 Purchases 63

420 420

DRAFT PROFIT 3330

Inc Dec
Error 1 21
Error 2 100
Error 3 10
Error 4 199
Error 5 62
Error 6 90
Error 7 400
Error 8 960
500 1340 (842)
 CORRECTED PROFT 2488

SALES Xxx
LESS COST OF SALES +++/ ++++
OP INV
Purchases
Less: Purchase returns 100
Less: Closing INv (199)
PROFIT ---- / ----

3000 + 100 = 3100

3100 * 2% = 62

TR 3000 + 100 -62

When goods are sold on credit

1. TRA+
SalesI+

TRADE RECEIVABLE A

+ -
Sales XXXX Bank
Disc Allowed
Irrecoverable
Debts

2. When TR Pay
Bank A+
 Disc Allowed E+
TR A-

3. If TR do Not Pay
Irrecoverable Debts (E+)
TR A-
4. Entry to transfer Irrecoverable debts to Income Statement

Income Statement
Irrecoverable Debts

IRRECOVERABLE DEBTS E

+ -
TR xxxx Income xxx
Statement

INCOME STATEMENT

+ -
EXPENSES & INCOMES &
LOSSES GAINS
Irrecoverable Debts xxx
Debts Recovered
Dec in PFDD 350
PFDD 500
Inc in PFDD 500 Dec in PFDD 200
Inc in PFDD 100

5. When the amount is received in future that has been W/O as irrecoverable Debts
Bank A+
Debts Recovered I+

6. Journal entry to transfer the debts recovered to Income Statement

Debts Recovered
Income Statement

DEBTS RECOVERED

- +
INCOME xxx Bank XXXX
STATEMENT

PROVISION FOR DOUBTFUL DEBTS (A-)

- +
31 Dec 2020 Balance c/d 500 31 Dec 2020 Income 500
Statement
TOTAL TOTAL
31 Dec 2021 Balance c/d 750 1 Jan 2021 Balance b/d 500
(15000 *5%)
INCOME 250
STATEMENT
TOTAL TOTAL
31 Dec Balance c/d 1250 1 Jan 2022 Balance b/d 750
(25000 *5%)
31 Dec INCOME 500
STATEMENT
TOTAL TOTAL
31 Dec 2023 Balance c/d 900 1 Jan 2023 Balance b/d 1250
(18000 *5%)
INCOME 350
STATEMENT
1250 1250
Balance c/d 1000 1 Jan 2024 Balance b/d 900
(20000 *5%)
Income 100
Statement
1000 1000
INCOME 200 1 Jan 2025 Balance b/d 1000
STATEMENT
31 Dec 2025 Balance c/d 800
(16000 *5%)
1000 1000

CURRENT ASSET
2020 TR - PFDD
10000 - 500 9500
 CURRENT ASSET
TR - PFDD
15000 - 750 14250

TRIAL BALANCE

TR 10000
Irrecoverable Debts 500

Additional INFO
Amount$400 owing by TR is to be written off

10000 – 400 = 9600*5%

INCOME STATEMENT

Sales Revenue ????

Less: COST OF SALES
Opnening INv of FINISHED GOODS Xxx
Purchases of Finished goods Xxx
AddL CARRIAGE INWARDS On Xxx
FINISHED GOODS
COST OF PRODUCTION of Xxx
FINISHED GOODS
Less: CLOSING INV OF FINISHED (xxx)
GOODS
(===)
GROSS PROFIT (35% of COST OF XXXX
SALES 35% MARKUP)
 PURCHASE JOURNAL

Date Name of Supplier/ Details $ $

4 Aug Nyack 6250
Less: TRADE DISCOUNT 20% 1250
5000
9 Aug Gaby 2600
Less: TRADE DISCOUNT 20% 520
2080
31 Aug/ End of Week Total CR Purchase transferred to 7080
Purchase Account

PURCHASE RETURN JOURNAL

Date Name of Supplier/ Details $ $

13 Aug Gaby 100
Less: TRADE DISCOUNT 20% 20
80

31 Aug Total Transferred to Purchase 80

return Account

PURCHASE

+ -
31 Aug Total Cr 7080
Purchase for the
month

PURCHASE RETURN ACCOUNT

- +
31 Aug Total returns for 80
the month