Jade receives cash from jose in part payment of an amt owed to jade in respect of a
sale to jose cash dr recievables cr
drawings -
1. Drawings To cash
2. Drawings to purchases
return of goods
3. ABC receives goods from x on credit & ABC pays by cheque. ABC then finds
goods faulty and cancels the cheque - Bank debit To payables
Discount -
the cash book of X ltd has a memorandum column recording discs allowed . the
column is totaled every week and posted to the nominal ledger payables to disc
received
bal means
a cr bal of 1834 brought down on BLTs ac in books of ABC means ABC owes BLT
1834
ABC has an ac in its nominal ledger for FGH which has a debit bal of 1089 FGH
owes ABC 10089 . in the ledger of FGH this would represent 1089 bal
ABC has a customer XYZ who owed it 700 on 1 st jan . during jan XYZ purchased
additional goods at a cost of 1k and returned some unwanted goods which had cost
320 . during jan XYZ also made a payment towards settlement if its ac of 750. at
31st ja ABC ledger acs would indicate a debit bal for XYZ for 1130 . this represents
an asset to ABC .
What does an invoice for 200 dollars being credited to the electricity ac means ?
Which changes the cap
Selling inventories at a profit increases cap emp , Selling goods for more than cost,
purchase of a non current asset on credit , owner withdrawing cash , wages being
paid in cash changes it , Recievables paying in full does not
what is the bal
1. on 1st jan a bs had a customer junior , who owed 1200 . during jan junior
bought goods for 2100 and returned goods valued at 750 he also paid 960 in
cash towards os bal . bal on junior ac ans 1590 debit 1200 dr + 2100 dr
750 cr 960 cr
2. Andy introduced 150000 into a new bs & obtains a loan of 1 lakh net
assets are worth 150000
3. A bs has profit 290000 cap intro 32k , inventories 8800 worth were used
for pvt purposes , net assets at the beg were 406800 , cl net assets were
406800 + 290000 + 32k -8800
acc eqn
Op cash 1k , inventories costing 800 are bought & half of m are sold for 1k plus
sales tax 20% . customer paying at once .
Cash 1k cap 1k
Inventories 800 payables 800
Cash 1200 sales tax owing 200
Inventories (400) profit ( add to cap ) 600
2600 2600
Assets 2600 less liabilities 1000 = cap 1600
Profit 32500 , this fig is arrived at after deducting 100 per week wages for
himself , in addition he put his home telephone bill , amounting to 400 plus sales
tax 20% . he is registered for sales tax & therefore has charged only the net amt to
his p & l .
CL cap , op cap ?
Op cap 6500 , cl cap ?
Op cap 6500
Add profit ( after drawings ) 32500
Less sales tax ( 80 )
Cl cap = 38920
A sole trader's business made a profit of $32,500 during the year ended 31 March
20X8. This figure was after deducting $100 per week wages for himself. In addition,
he put his home telephone bill through the business books, amounting to $400 plus
sales tax at 17.5%. He is registered for sales tax and therefore has charged only the
net amount to his income statement. His capital at 1 April 20X7 was $6,500. His
capital at 31 March 20X8 was
Capital at 1.4.X7 6,500
Add profit (after drawings) 32,500
Less sales tax element (70)
Capital at 31.3.X8 38,930
At 31 December 20X1, a business had: Motor cars 2,000 Inventory 500 Receivables
300 Accrued Electricity Expense 50 Rent prepaid 200
At 31 December 20X2, it had: Motor cars 2,500 Inventory 100 Receivables 50
Payables 600 Accrued Electricity Expense 100 Rent prepaid 250 The owner has
drawn $1,000 in cash over the year. What is the profit or loss?
Net assets 31/12/X1 2,000 + 500 + 300 50 + 200= 2,950
Net assets 31/12/X2 2,500 + 100 + 50 600 100 + 250= 2,200
net assets = 2200 2950 = 750 decreasein NA
Change in net assets = Capital + profit drawings
-750 = Profit drawings ($1,000)
profit = 250
In a statement of financial position, capital plus profit less drawings must always
equal: net assets
A sole trader decides to 'net off' the amount he owes to a supplier who is also a
customer. Which of these statements is wrong? CA will not change is wrong
At 31 December 20X1, a business had net assets of $10,000. At 31 December 20X2
net assets had risen to $12,500. Profit for the year was $8,000 and no new capital
was introduced. How much were drawings in the period.
P = I + D C 8,000 = 2,500 + D 0 D = $5,500
