Accounting

  BA BUSINESS PORTFOLIO Year 1 ACCOUNTING FUNDAMENTALS Resit Assignment 1 Donald Smith is a retailer of photocopiers. He prepares accounts to 31 December 2010. At 1 January 2010 the balances on his nominal ledger accounts were as follows:                                                                                                                  £ Capital                                                                                                 11,600 Bank                                                                                                      4,000 Cash                                                                                                         100 Motor Vehicles – Cost                                                                      20,000 Motor Vehicles – Provision for Depreciation                                       5,000 Fixtures and Equipment – Cost                                                             4,000 Fixtures and Equipment – Provision for Depreciation                         1,000 Trade Debtor (Mr. Jones)                                                                      3,000 Trade Creditor (Mr. Lewis)                                                                    2,000 Bank Loan                                                                                            18,000 VAT Control Account                                                                             1,500 Stock                                                                                                      8,000 Task 1 Enter these opening balances into a spreadsheet   During the year ended 31 December 2010 the following transactions took place (VAT is 17.5% unless otherwise stated). Workings should be to the nearest £: Credit Sales 14 January       Sold goods for £20,000 plus VAT to Mr Davies 18 June            Sold goods for £40,000 including VAT to Mr Jenkins 30 September Sold goods for £30,000 plus VAT to Mr Griffiths Task 2 Complete the Sales Day Book for the year Credit Purchases and Expenses 4 January         Purchased goods from Mr Osborne for £10,000 plus VAT 16 July             Purchased goods from Mr Morgan for £18,000 including VAT 14 August        Received a telephone bill from BT  for £400 plus VAT 18 October      Received a gas bill from British Gas for £600 including VAT at 5% 24 December  Purchased equipment for £2,000 plus VAT Task 3 Complete the Purchase Day Book for the year Cash Payments 23 May            Bought stamps for £18 (no VAT) 12 July             Bought tea and coffee for £21 (no VAT) 19 August        Reimbursed petty cash float to top back up to £100. This was done by cashing a cheque Task 4 Complete the Petty Cash Book for the year Bank Receipts 2 February       Received a cheque from Mr Jones for £2,800 in full settlement of his balance at 1 January 2010, the remainder being discount 14 March        Received a cheque from Mr Davies for £15,000 9 August          Sold a car for £1800 (no VAT) 18 October      Received a cheque from Mr Jenkins for £20,000 19 November Made Cash Sales of £1,000 plus VAT  4 December   Donald Smith put £5,000 of his own money into the business     Bank Payments 14 January       Paid Mr Lewis £1,900 in full settlement of his balance at 1 January 2010, the remainder of the balance being discount 20 February     Paid Mr Osborne £7,000 21 September Paid the telephone bill by cheque 1 October        Paid the annual insurance (to 30 September 2011) of £900 (no VAT) 7 November    Paid legal fees of £1,300 plus VAT 30 November  Donald Smith paid himself £2,000 Task 5 Complete the Cash Book for the year Task 6 Enter the information from the daybooks onto the spreadsheet and produce a draft trial balance at 31 December 2010   The following information has not been accounted for: 1.      The car sold on 9 August originally cost £7,000 on 1 May 2007. A full year’s depreciation is charged in the year of purchase and none in the year of sale. 2.      Depreciation is to be provided at the following rates: Motor Vehicles                       25% straight line                 Fixtures and Equipment          20% reducing balance 3.      At 31 December 2010 it was estimated that telephone of £40 and gas of £50 were outstanding 4.      Stock at 31 December 2010 was £6,000 5.      The insurance prepayment needs to be calculated   Task 7 Update your spreadsheet to reflect the additional information   Task 8 Produce a Profit and Loss account for the year ended 31 December 2010 and a Balance Sheet at that date  | |