Amazon Traders – Trading Statement For The Year Ending 30 June 2020

Task 1

Amazon Traders – Trading Statement for the year ending 30 June 2020 Save Time On Research and Writing Hire a Pro to Write You a 100% Plagiarism-Free Paper. Get My Paper
Sales Revenue		$ 78,900.00
Purchase	$ 32,300.00 Save Time On Research and Writing Hire a Pro to Write You a 100% Plagiarism-Free Paper. Get My Paper
Add: Opening Inventory	$ 32,000.00
Less: Closing Inventory	$ 10,800.00
Cost of Goods Sold	$ 53,500.00
Freight Inwards	$ 1,550.00
	$ 55,050.00
Custom duty	$ 1,600.00	$ 56,650.00
Gross Profit (Loss)		$ 22,250.00

Cash Receipts Journal
Date Feb	Rec. No.	Details	Cash Sales (Inventory)	Commission Received	Sundries	GST	Amount Banked
Collected
01-Feb	CR1	Cash Contributed by Ben Hur			$ 30,000.00		$ 30,000.00
04-Feb	CR2	Inventory Sold	$ 1,000.00			$ 100.00	$ 1,100.00
04-Feb	CR3	Commission Received		$ 800.00		$ 80.00	$ 880.00
06-Feb	BS	Bank Interest Received			$ 50.00		$ 50.00
10-Feb	CR4	Inventory Sold	$ 700.00			$ 70.00	$ 770.00
		Total					$ 32,800.00

Cash Payments Journal
Date Feb	Chq. No.	Details	Cash Purchases Inventory	Wages	Sundries	GST Paid	Total Paid
02-Feb	101	Purchased Computer			$ 2,500.00	$ 250.00	$ 2,750.00
02-Feb	102	Rent Paid			$ 1,200.00	$ 120.00	$ 1,320.00
03-Feb	103	Inventory Purchased	$ 2,000.00			$ 200.00	$ 2,200.00
05-Feb	104	Cash Withdrawn			$ 110.00		$ 110.00
07-Feb	EFT	Wages Paid		$ 650.00			$ 650.00
07-Feb	105	Advertisement Paid			$ 500.00	$ 50.00	$ 550.00
08-Feb	BPAY	Council Rates paid			$ 900.00		$ 900.00
09-Feb	BS	Bank charges paid			$ 25.00		$ 25.00
		Total					$ 8,505.00

Cash Receipts	Cash Payments
Date	Details	Amount $	Date	Details	Amount $
02-Jul	Cash Recipt	$ 1,446.52	01-Jul	#324875	$ 1,526.16
07-Jul	Cash Recipt	$ 3,486.72	04-Jul	#324876	$ 905.70
11-Jul	Cash Recipt	$ 1,538.90	08-Jul	#324877	$ 2,404.38
11-Jul	Cash Recipt	$ 436.84	12-Jul	#324878	$ 1,702.86
12-Jul	Cash Recipt	$ 2,360.20	15-Jul	#324879	$ 1,296.98
21-Jul	Cash Recipt	$ 1,039.30	20-Jul	#324880	$ 561.40
30-Jul	Cash Recipt	$ 846.76	28-Jul	#324881	$ 1,958.30
	Total	$ 11,155.24		Total	$ 10,355.78

Bank Ledger A/c
Date	Details	Debit	Credit	Balance
01-Jul	Balance B/d	2981.98		2981.98	Dr
31-Jul	Receipts		$ 11,155.24	8,173.26	Cr
31-Jul	Payments	$ 10,355.78		2,182.52	Dr

Bank Reconciliation Statement as of July 31
	Cheque No.	$
Debit balance as per Bank Statement		-3182.9
Add: Unpresented Cheques	#324856	934.02
Sub-total		-2248.88
Less: Outstanding Deposits		733.1
		-2981.98
Credit Balance per the Bank Ledger Account

The main purpose of carrying out a routine bank reconciliation for any business is to ensure that cash records and bank records tally and there is no incidence of omission or double counting. This would help the business to keep a track on the cash flows and also monitoring the preparation of cash statements so as to ensure that a level of accuracy is maintained for the same (Sunarya, Nurhaeni and Haris 2017). The process helps in ensuring that proper cash deposits are made into the bank and further the payments which were due to be made are undertaken. The business is able to maintain a level of transparency and accountability with the help of Bank Reconciliation Process. In an overall basis, it can be said that bank reconciliation is important for identification of mistakes and errors and for tallying the records in cash book and bank statements (Spiteri 2020). It is for such reasons that such processes are considered to be important for maintaining accuracy in financial reporting process.

As per the case when a bank deposits a sum of money into any account than it credits the amount mainly due to the fact that the money does not belong to the bank and it is just keeping it on behalf of the client. However, from the perspective of the depositor of the money, it is his asset and therefore in general ledger cash balances are debited. The above case mainly demonstrates the application of the golden rules of accounting (Arora 2016). The recording for the bank is done in the books of the bank and therefore the money deposited is a liability and therefore demonstrates a credit balance. In the similar manner, when an individual maintains his own books in general ledger, the amount is debited as the cash belongs to him and is part of this total assets (Aisyah, Maimunah and Martono 2017). Further the transaction is also facilitated by double entry system of accounting.

The example of the transactions which may appear in the bank statements but during the process of reconciliation may not appear on the business records are listed below:

Cheques Deposited in banks but not yet processed
Bank charges for services provided by the bank.

General Journal – John Keith
Date	Particulars	Debit	Credit
01-Sep	Premises A/c…………….Dr	750000
	Cash A/c…………………..Dr	30000
	Shop Fittings A/c……………Dr	30000
	To Mortgage on Premises		300000
	To Capital A/c		510000
	Cash &Assets brought into the business
09-Sep	Motor Vehicle A/c…………………Dr	50000
	To Capital A/c		50000
	Motor vehicle contributed to the business
11-Sep	Drawings A/c………………………..Dr	110
	To Stock A/c		100
	To GST paid		10
	Stocks being used for personal use
14-Sep	Drawings A/c………………………..Dr	88
	To Surplus Selving		80
	To GST paid		8
	Surplus Selving used for personal use

	Trial Balance	Income Statement	Balance Sheet
Accounts	Debit	Credit	Debit	Credit	Debit	Credit
Building	31,483				31,483
Bank	1,900				1,900
Accounts Receivable	3,700				3,700
Accounts Payable		5,000				5,000
GST Collected		2,600				2,600
GST Paid	2,000				2,000
Sales		44,593		44,593
Cost of Goods Sold	21,118		21,118
Office Equipment	950				950
Inventory	13,832				13832
Delivery Expenses	475		475
Insurance	228		228
Electricity	532		532
Telephone	190		190
Salaries	2,470		2470
Rates	238		238
Discount Allowed	1,007		1007
Rent	484		484
Commission Income		807		807
Capital (opening)		27,607				27,607
Net Profit			18,658			18,658
Totals	80,607	80,607	45400	45400	53865	53865

Amazon Traders – Income Statement for the year ended 30 June
	$	$
Sales		44,593
Less: Cost of Goods sold		21,118
Gross Profit		23,475
Add Other Revenue:
Commission Income		807
Total Operating Income		24,282
Total Operating Expenses:
Delivery Expenses	475
Insurance	228
Electricity	532
Telephone	190
Salaries	2470
Rates	238
Discount Allowed	1007
Rent	484	5624
Net Profit (Loss)		18,658

Amazon Traders – Balance Sheet as of 30 June
	$	$
Current Assets
Bank	1,900
Accounts Receivable	3,700
Inventory	13832
GST Paid	2,000	21,432
Non-Current Assets
Building	31,483
Office Equipment	950	32,433
Total Assets		53,865
Current Liabilities
Accounts Payable	5,000
GST Collected	2,600	7,600
Total Liabilities		7,600
Net Assets		46,265
Owners’ Equity
Capital (opening)		27,607
Net Profit		18,658
		46,265

Reference

Aisyah, E.S., Maimunah, M. and Martono, A., 2017. Effectiveness of Book Closing Using Web Based Accounting Online System 2.0 to Know the Company’s Financial Ratios.APTISI Transactions on Management (ATM), 1(1), pp.56-60.

Arora, M.N., 2016. ACCOUNTING FOR MANAGEMENT. HIMALAYA Publishing House.

Spiteri, S., 2020. Financial Accounting: From Its Basics to Financial Reporting and Analysis. Cambridge Scholars Publishing.

Sunarya, P.A., Nurhaeni, T. and Haris, H., 2017. Bank Reconciliation Process Efficiency Using Online Web Based Accounting System 2.0 in Companies. APTISI Transactions on Management (ATM), 1(2), pp.124-129.

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