Table of Contents
Description of Business
APPLICATION OF PRINCIPLES
Income Statement: Trading and Profit & Loss A/c
: Balance Sheet
CONCLUSION: SUMMARY& EVALUATION
Accounting is the process by which financial information is categorized, summarized and interpreted to communicate a business financial position. This School-Based Assessment is based on a sole trader entrepreneur, Onai Forde, who owns and operates a business that sells goods and provides services to the public. Entries were recorded in Ledgers, Journals and the Cashbook. There was a preparation of a Trading and Profit and Loss Account and the extraction of a Balance Sheet and Trial Balance for the month.
The successful completion of this assessment would not have been possible without the assistance and co-operation from the following persons, the researcher would therefore like to thank: * The Almighty God for giving him the health, wisdom, strength, knowledge and understanding to complete this assessment. * His mom for the financial assistance
* Last but not least her teacher for guiding him step by step throughout this assessment. Thank you
Aims of the Project
The mission/aim of my project is for me to:
* Arrive at a comprehensive understanding of the financial sector of the business world. * Gain first-hand knowledge of a real business and apply the accounting principles in this practical business environment, * To draw up the financial records for Forde’s Convenience Store for the year 2013 and to comment on the entity as performance using the appropriate tools of analysis.
Description of Business
Forde’s Convenience Store is a simulated business entity, owned and managed by Onai Forde, who is the sole proprietor. Forde’s Convenience Store is a developed entity which sells a variety of items and miscellaneous goods, serving our customers in its convenient location. This business employed ten staff along with Mr. Forde acting as owner/manager. There are three supervisors and seven general workers who act as cashiers, shelf stackers, as assistance and security. The accounting records are kept on double entry principles, with all the required journals, ledgers, and a cash book to record the cash and credit transactions of the entity. Forde’s Convenience Store have implemented many policies, for instance, credit is allowed, cash is definitely the most preferred means of payment and customers are allowed to return goods within a thirty (30) limit. Goods returned are to be thoroughly accessed.
The period under review is January 2013.
Forde’s Convenience Store keeps records according to the standard form of double entry principles and in keeping with the accounting cycle shown below.
The Accounting Cycle
| Started Business with $100,000 cash & $200, 00 in the bank
| Jan 3
| Bought goods on credit from S. Solomon $12,000. K. Peters $5000 and J. Mickle$4, 500
| Jan 3
| Returned Goods to S. Solomon $6000
| Bought Motor Vehicle $55, 000 by cheque
| Paid employees taxi fare $500
| Put $25, 000 cash in the bank account.
| Petrol Expense $3,500
| Cash Sales $20, 000
| Paid Rent by cash $7, 500
| Paid Wages by cash $4000
| Sold Goods on credit to S. Shiwprasad $15, 000, L. Lewis$23,000 and R. Rajaram$17, 000
| Jan 22
| R. Rajaram returned goods of $500 and L. Lewis returned goods of $1000.
| Jan 23
| Cash Taken out for personal use $7000
| Cash Purchases $11, 700
| Motor Repairs by Steve’s...
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