ACCT1110 Principles Of Accounting I

Answer:

Introduction

Principles of accounting may be defined as broad underlying concept which guides bookkeepers while preparing financial statements. According to Bradbury & Schröder (2012), this report presents the financial statements of a new restaurant Apple which includes journal entries, ledger accounts, trial balance, income statement and balance sheet of restaurant for recording the daily business transactions in the books of accounts (Coetsee, 2010).

Financial statements of Apple restaurant

Date

Particular

Amount $ (Debit)

Amount $ (Credit)

1 Jan

Cash a/c Dr

To capital a/c

20000

2 Jan

Rent a/c Dr.

To cash a/c

3000

3 Jan

Machinery (Kitchen equipments) a/c Dr.

To Berry a/c

5400

4 Jan

Furniture & Fixtures a/c Dr.

To Durian a/c

Purchase a/c Dr.

To cash a/c

2400

300

2400

300

5 Jan

Purchase a/c Dr.

To cash a/c

1500

6 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr/

To inventory a/c

400

200

400

200

7 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

560

280

560

280

8 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

480

220

480

220

9 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

660

320

660

320

10 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

Purchase a/c Dr.

To Melon Foods a/c

520

260

1600

520

260

1600

11 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

Melon Foods a/c Dr.

To Purchase return a/c

400

180

200

400

180

200

12 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

Purchase a/c Dr.

To cash a/c

390

190

400

390

190

400

13 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

460

250

460

250

14 Jan

Mango steen a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

540

240

540

240

15 Jan

Berry a/c Dr.

To cash a/c

To discount received a/c

Cost of goods sold a/c Dr.

To inventory a/c

5400

200

5292

108

200

16 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

Melon foods a/c Dr.

To cash a/c

380

140

1500

380

140

1500

17 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

Drawings a/c Dr.

To cash a/c

420

170

2000

420

170

2000

18 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

Purchase a/c Dr.

To Melon and foods a/c

480

240

1800

480

240

1800

19 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

Repairs a/c Dr.

To cash a/c

490

250

490

250

20 Jan

Rambu Tan a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

Melon foods a/c Dr.

To cash a/c

500

230

1600

500

230

1600

21 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

520

210

520

210

22 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

Purchase a/c Dr.

To cash a/c

330

160

300

330

160

300

23 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

Purchase a/c Dr.

To Longan store a/c

370

190

1700

370

190

1700

24 Jan

Cash a/c Dr.

To Mango Steen a/c

Cost of goods sold a/c Dr.

To inventory a/c

Cash a/c Dr.

To sales a/c

580

180

390

580

180

390

25 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

450

220

450

220

26 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

Durion & Co. a/c Dr.

To cash a/c

To discount received a/c

460

170

2400

460

170

2376

27 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

Purchase a/c Dr.

To cash a/c

600

350

400

600

350

400

28 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

Purchase a/c Dr.

To Melon foods a/c

520

260

1000

520

260

1000

29 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

Melon foods a/c Dr.

To purchase a/c

430

200

430

200

30 Jan

Cash a/c Dr.

To sales a/c

Cost of goods sold a/c Dr.

To inventory a/c

Cash a/c Dr.

To bills received a/c

Drawings a/c Dr.

To cash a/c

480

260

300

2000

480

260

300

2000

31 Jan

Wages a/c Dr.

To cash a/c

2300

Double entries posted in ledger accounts

According to Collins et al. (2012), Journal Entries posted in the ledger accounts of Apple Restaurant:

Dr. Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
1 Jan	To capital a/c	20000	2 Jan	By rent a/c	3000
6 Jan	To sales a/c	400	4 Jan	By purchase a/c	300
7 Jan	To sales a/c	560	5 Jan	By purchase a/c	1500
8 Jan	To sales a/c	480	12 Jan	By purchase a/c	400
9 Jan	To sales a/c	660	15 Jan	By berry a/c	5292
10 Jan	To sales a/c	520	16 Jan	By Melon foods a/c	1500
11 Jan	To sales a/c	400	17 Jan	By drawings a/c	2000
12 Jan	To sales a/c	390	19 Jan	By repairs	50
13 Jan	To sales a/c	460	20 Jan	By Melon foods a/c	1600
16 Jan	To sales a/c	380	22 Jan	By purchase a/c	300
17 Jan	To sales a/c	420	26 Jan	By Durian & Co. a/c	2376
18 Jan	To sales a/c	480	27 Jan	By purchase a/c	400
19 Jan	To sales a/c	490	30 Jan	By drawings a/c	2000
21 Jan	To sales a/c	520	31 Jan	By wages a/c	2300
22 Jan	To sales a/c	330	31 Jan	By balance c/d	8052
23 Jan	To sales a/c	370
24 Jan	To mango steen a/c	580
24 Jan	To sales a/c	390
25 Jan	To sales a/c	450
26 Jan	To sales a/c	460
27 Jan	To sales a/c	600
28 Jan	To sales a/c	520
29 Jan	To sales a/c	430
30 Jan	To sales a/c	480
30 Jan	To bills received a/c	300
		31070			31070

Dr. Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
31 Jan	To balance c/d	20000	1 Jan	By cash a/c	20000
		20000			20000

Dr. Rent a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
2 Jan	To cash a/c	3000	31 Jan	By balance c/d	3000
		3000			3000

Dr. Machinery a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
3 Jan	To Berry a/c	5400	31 Jan	By balance c/d	5400
		5400			5400

Dr. Berry a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount($)
15 Jan	To cash a/c	5292	3 Jan	By machinery a/c	5400
15 Jan	To discount received a/c	108
		5400			5400

Dr. Furniture a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
4 Jan	To Durian a/c	2400	31 Jan	By balance c/d	2400
		2400			2400

Dr. Durian a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
31 Jan	By balance c/d	2400	4 Jan	By furniture a/c	2400
		2400			2400

Dr. Purchase a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
4 Jan	To cash a/c	300	29 Jan	By Melon foods a/c	60
5 Jan	To cash a/c	1500	31 Jan	By balance c/d	8940
10 Jan	To Melon foods a/c	1600
12 Jan	To cash a/c	400
18 Jan	To Melon foods a/c	1800
22 Jan	To cash a/c	300
23 Jan	To Longan store a/c	1700
27 Jan	To cash a/c	400
28 Jan	To Melon foods a/c	1000
		9000			9000

Dr. Melon foods a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
11 Jan	To purchase return a/c	200	10 Jan	By purchase a/c	1600
16 Jan	To cash a/c	1500	18 Jan	By purchase a/c	1800
20 Jan	To cash a/c	1600	28 Jan	By purchase a/c	1000
29 Jan	To purchase a/c	60
31 Jan	To balance c/d	1040
		4400			4400

Dr. Purchase return a/c Cr.

Date

Particular

Amount ($)

Date

Particular

Amount ($)

31 Jan

To balance c/d

200

11 Jan

By Melon foods a/c

200

Dr. Mango Steen a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
14 Jan	To sales a/c	540	24 Jan	By cash a/c	580
31 Jan	To balance c/d	40
		580			580

Dr. Drawings a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
17 Jan	To cash a/c	2000	31 Jan	To balance c/d	4000
30 Jan	To cash a/c	2000
		4000			4000

Dr. Discount received a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
31 Jan	To balance c/d	132	15 Jan	By Berry a/c	108
			26 Jan	By Durion & Co. a/c	24
		132			132

Dr. Repairs a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
19 Jan	To cash a/c	50	31 Jan	To balance c/d	50
		50			50

Dr. Rambu Tan a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
20 Jan	To sales a/c	500	31 Jan	To balance c/d	500
		500			500

Dr. Longan store a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
31 Jan	To balance c/d	1700	23 Jan	By purchase a/c	1700

		1700			1700

Dr. Bills received a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
31 Jan	To balance c/d	300	30 Jan	By cash a/c	300
		300			300

Dr. Wages a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
31 Jan	To cash a/c	2300	31 Jan	To balance c/d	2300
		2300			2300

Dr. Sales a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
31 Jan	To balance c/d	11230	6 Jan	By cash a/c	400
			7 Jan	By cash a/c	560
			8 Jan	By cash a/c	480
			9 Jan	By cash a/c	660
			10 Jan	By cash a/c	520
			11 Jan	By cash a/c	400
			12 Jan	By cash a/c	390
			13 Jan	By cash a/c	460
			14 Jan	By Mango steen a/c	540
			16 Jan	By cash a/c	380
			17 Jan	By cash a/c	420
			18 Jan	By cash a/c	480
			19 Jan	By cash a/c	490
			20 Jan	By Rambu Tan	500
			21 Jan	By cash a/c	520
			22 Jan	By cash a/c	330
			23 Jan	By cash a/c	370
			24 Jan	By cash a/c	390
			25 Jan	By cash a/c	450
			26 Jan	By cash a/c	460
			27 Jan	By cash a/c	600
			28 Jan	By cash a/c	520
			29 Jan	By cash a/c	430
			30 Jan	By cash a/c	480

		11230			11230

Dr. Cost of goods sold a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
6 Jan	To inventory a/c	200	31 Jan	To balance c/d	5570
7 Jan	To inventory a/c	280
8 Jan	To inventory a/c	220
9 Jan	To inventory a/c	320
10 Jan	To inventory a/c	260
11 Jan	To inventory a/c	180
12 Jan	To inventory a/c	190
13 Jan	To inventory a/c	250
14 Jan	To inventory a/c	240
15 Jan	To inventory a/c	200
16 Jan	To inventory a/c	140
17 Jan	To inventory a/c	170
18 Jan	To inventory a/c	240
19 Jan	To inventory a/c	250
20 Jan	To inventory a/c	230
21 Jan	To inventory a/c	210
22 Jan	To inventory a/c	160
23 Jan	To inventory a/c	190
24 Jan	To inventory a/c	180
25 Jan	To inventory a/c	220
26 Jan	To inventory a/c	170
27 Jan	To inventory a/c	350
28 Jan	To inventory a/c	260
29 Jan	To inventory a/c	200
30 Jan	To inventory a/c	260

		5570			5570

Dr. Inventory a/c Cr.

Date	Particular	Amount ($)	Date	Particular	Amount ($)
31 Jan	To balance c/d	5570	6 Jan	By Cost of goods sold a/c	200
			7 Jan	By Cost of goods sold a/c	280
			8 Jan	By Cost of goods sold a/c	220
			9 Jan	By Cost of goods sold a/c	320
			10 Jan	By Cost of goods sold a/c	260
			11 Jan	By Cost of goods sold a/c	180
			12 Jan	By Cost of goods sold a/c	190
			13 Jan	By Cost of goods sold a/c	250
			14 Jan	By Cost of goods sold a/c	240
			15 Jan	By Cost of goods sold a/c	200
			16 Jan	By Cost of goods sold a/c	140
			17 Jan	By Cost of goods sold a/c	170
			18 Jan	By Cost of goods sold a/c	240
			19 Jan	By Cost of goods sold a/c	250
			20 Jan	By Cost of goods sold a/c	230
			21 Jan	By Cost of goods sold a/c	210
			22 Jan	By Cost of goods sold a/c	160
			23 Jan	By Cost of goods sold a/c	190
			24 Jan	By Cost of goods sold a/c	180
			25 Jan	By Cost of goods sold a/c	220
			26 Jan	By Cost of goods sold a/c	170
			27 Jan	By Cost of goods sold a/c	350
			28 Jan	By Cost of goods sold a/c	260
			29 Jan	By Cost of goods sold a/c	200
			30 Jan	By Cost of goods sold a/c	260

		5570			5570

Trial Balance as on 31 January 2017

S.No.	Particular	Debit ($)	Credit ($)
1	Cash a/c	8052	–
2	Capital a/c	–	20000
3	Rent a/c	3000	–
4	Furniture a/c	2400	–
5	Durian a/c	–	2400
6	Purchase a/c	8940	–
7	Melon Foods a/c	–	1040
8	Purchase return a/c	–	200
9	Mango Steen a/c	–	40
10	Drawings a/c	4000	–
11	Discount received a/c	–	132
12	Repairs a/c	50	–
13	Rambu Tan a/c	500	–
14	Longan store a/c	–	1700
15	Bills received/c	–	300
16	Wages a/c	2300	–
17	Sales a/c	–	11230
18	Cost of goods sold a/c	5570	–
19	Inventory a/c	–	5570
20	Machinery a/c	5400	–
		40212	40212

Income Statement as at 31 January 2017

According to Needles et al. (2013), the income statement and balance sheet of Apple restaurant:

Income	Amount	Income ($)	Amount ($)
To opening stock a/c	–	By sales	11230
To purchase 8940 Less: Purchase return (200)	8740
To wages	2300	By closing stock	5570
To Gross Profit	5760
	16800		16800
To rent a/c	3000	By Gross Profit	5760
To repairs a/c	50	By discount received a/c	132
To Net Profit	3142	By bills received a/c	300
	6192		6192

Balance Sheet as at 31 January 2017

Liabilities	Amount	Assests	Amount
Capital 20000 Less: Drawings (4000) Add: Net Profit 3142	19142	Cash a/c	8052
Creditors: Melon Foods 1040 Mango Steen 40 Rambu Tan 500 Durian & Co. 2400	3980	Debtors: Longan Store a/c	1700
		Machinery a/c	5400
		Closing Stock a/c	5570
		Furniture a/c	2400
	23122		23122

Conclusion

This report has concluded the financial statements of Apple Company as at 31 January 2017. The report evaluate the performance of Apple restaurant by prepared the financial statements which includes the journal entries, ledger accounts, trial balance, income statements and balance sheet as at 31 January 2017 and all these statements are prepared according to International Accounting Standard board.

References

Bradbury, M.E. & Schröder, L.B., 2012. The content of accounting standards: Principles versus rules. The British Accounting Review, 44(1), pp.1-10.

Coetsee, D., 2010. The role of accounting theory in the development of accounting principles. Meditari: Research Journal of the School of Accounting Sciences, 18(1), pp.1-16.

Collins, D.L., Pasewark, W.R. & Riley, M.E., 2012. Financial reporting outcomes under rules-based and principles-based accounting standards. Accounting Horizons, 26(4), pp.681-705.

Needles, B.E., Powers, M & Crosson, S.V., 2013. Principles of accounting. Cengage Learning.

Powers, M., Crosson, S.V. & Needles, B.E., 2014. Principles of accounting. South-Western, Cengage Learning.

Weygandt, J.J., Kimmel, P.D. & Kieso, D.E., 2015. Financial & Managerial Accounting. John Wiley & Sons.

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