| BA30592E: Recording Business Transactions |
- Learning outcomes
Part A
- David Green is going to set up a sole trader business as a Decorator. He knows that he would be personally responsible for his business’s debts. He also would have some accounting responsibilities; however, he does not know about the steps for starting a business. As your area of studying is related to Business, he wants you to consult him in this matter.
- Accounting involves recording, analyzing, and summarising the transactions of an entity to provide information for decision making.
Part B
- F Polk, after being in the Bakery business for some years without keeping proper records, now decides to keep a double-entry set of books. On 1 September 2021 he establishes that his assets and liabilities are as follows: Assets: Van £5,700, Fixtures £2,800, Stock £5,200, Debtors – P Mullen £105, M Abel £311, Bank £1060, Cash £85. Liabilities: Creditors – Syme Ltd £229, A Hill £80.
He is not sure about Journal entries for the following transactions in September 2021 as follows:
- Sep 1: A debt of £105 owing from P Mullen was written off as a bad debt
- Sep 5: Office Fixtures originally bought by credit for £150 was returned to the supplier Syme Ltd., as it was unsuitable. The full allowance will be given for this.
Recording Business Transactions BA30592E - Step 10: The business is owed £311 by M. Abel. He is declared bankrupt and we only received £180 cash in full settlement of the debt.
- Sep 18: Bought a Machinery from Brown Ltd. to use in the company. The total purchasing value of the machine is £1,800. The owner paid £100 cash, £500 by issuing a cheque, and the rest of the purchasing value would remain as credit.
- Sep 26 The owner paid half of the machinery debt to Brown Ltd. by issuing a cheque.
- Sep 28: The owner paid £130 an insurance bill via cheque thinking that it was in respect of the business. We now discover that £70 of the amount paid was in fact insurance of our private house.
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- On 1 August 2021, the owners of the ABC Enterprise, Maurice & brothers, decided that they will boldly go and keep their records on a double-entry system. Their assets and liabilities at that date were. Their assets and liabilities at that date were: office fixtures £1200, a van £32,000, and £36,800 in the bank account. They have no liabilities at the 1st of August 2021
Their transactions during August 2021 were as follows
- Aug 2 Maurice & brothers received a loan of £12,400 from Santander Bank and they deposited it in their bank account.
- Aug 3 The amount of £2800 was transferred from the Bank Account to the Cash and hand account.
- Aug 4 Bought a second-hand Van paying by cheque £6,200
- Aug 5 Bought office fixtures £3400 from Sharp Office Ltd. They paid £1000 by issuing a cheque and the rest of the value of the fixtures would remain as credit.
- Aug 8 Bought a new van on credit from Toyota Co. £8,700
- Aug 15 Bought office fixtures paying by cash £110
- Aug 19 Paid Toyota Co. a cheque for the whole amount of debt
- Aug 25 Paid £430 of the cash in hand into the bank account
- Aug 28 Bought new office fixtures paying via bank account £750
- Then balance off the accounts and extract a trial balance for sole trader B Moore. as of 30 September 2021:
The post BA30592E: Recording Business Transactions Learning outcomes Part A David Green is going to set up a sole trader business as a Decorator. He knows that he would be personally responsible for his business’s debts. He also would have some accounting responsibilities; however, he does not know about the steps for starting a business. As your area of studying is related to Business, he wants you to consult him in this matter. appeared first on My Academic Papers.
