Mias Wholesale & Retail
Statement of Affairs as at 31 December 2014
$
Fixed assets
Premises
Fixtures & Fittings
Current assets
Stock
Debtors
Bank
Cash
Less current liability
Creditors
Net current assets
Financed by :
Capital
$
130,000
25,000
155,000
12,000
5,600
9,000
510
27,110
1,500
25,610
180,610
180,610
OPENING JOURNAL ENTRIES
Journal
Date
2014
January 1
Details
Premises
Fixtures
Stock
Debtors M. Lyn
J. James
Bank
Cash
Creditors R. Graham
Capital
Folio
GL
GL
GL
SL
SL
CB
CB
PL
GL
Dr.
$
130,000
25,000
12,000
3,000
2,600
9,000
510
182,110
Cr.
$
1,500
180,610
182,110
Sales Journal
Details
Folio Debit $
1 M. Lane
SL
2,700
29 C. Browne
SL
4,900
31 Transfer to sales GL
a/c
Date
January
January
January
Date
January
January
January
Details
3 R. Graham
10 R. Gordon
31 Transfer to
purchases a/c
Date
January
January
Date
January
January
1
7
3
1
Purchases Journal
Folio Debit $
PL
PL
GL
7,054
GL
300
Credit $
7,600
00
Credit $
1620
5,434
00
00
00
Return Inwards Journal
Details
Foli Debit $
o
M. Lane
SL
Transfer to
R.I. a/c
00
00
Credit $
300
0
0
0
0
Return Outwards Journal
Details
Foli Debit $
o
11 R. Gordon
PL
452
0
0
3 Transfer to
GL
1 R.O. a/c
Credit $
452
00
Date
Details
Cash
Bank
Stock
Premises
Fixtures and
Fittings
Debtors
Creditors
Capital
General Journal
Folio
Debit $
510
9000
12000
130000
25000
5600
182110
00
00
00
00
Credit $
1500
180610
182110
00
00
00
00
00
CASH BOOK
Date
Details
Folio D.A
Cash
Bank
Date
Details
Folio
Jan 1
Balance
B/F
$510
$9,000
Jan 7
GL
Jan 6
Sales
GL
$1,504
Jan 7
Carriage
Inwards
R. Graham
Jan 18
Sales
GL
$4,664
Jan 9
GL
Jan 26
M. Lyn
SL
Jan 30
J. James
Jan 31
Cash
$75
$2,375
Jan 13
SL
$1,820
Jan 15
Wages
GL
$3,000
Jan 24
Drawings
GL
$400
Jan 28
GL
$850
Jan 31
Sundry
Expense
Carriage
Inwards
Bank
$3,000
Jan 31
Balance
C/D
$1788
$125
$125
Balance
$350
Sundry
Expense
Refrigerator
Jan 29
Feb 1
PL
D.R Cash
B/D
$6678
$16,195
$1788
$5320
$290
GL
GL
$75
$6678
Sales Ledger
Date
Details
Folio
Amt $
Date
Details
Folio
Amt $
M. LANE A/C
Jan
Feb
Sales
Balance
SJ
B/D
2700
00 Jan
17
R.
Inwards
SJ
300
00
Jan
31
Balance
C/D
2400
00
2700
00
2700
00
2400
00
M. LYN A/C
Jan
Feb
Balance
Balance
B/F
B/D
3000
00 Jan
26
Bank
2375
00
Jan
26
Discount
125
00
Jan
31
Balance
C/D
500
00
3000
00
4900
00
4900
00
3000
00
500
00
C. BROWNE A/C
Jan
Feb
29 Sales
Balance
SJ
B/D
4900
00 Jan
4900
00
4900
00
31 Balance
C/D
J. JAMES A/C
Jan
Balance
B/F
2600
Jan
30 Bank
Jan
30 Bad Debt
1820
00
780
00
2600
00
2600
00
Purchases Ledger
Date
Details
Folio
Amt $
Date
Details
Folio
Amt $
B/F
1500
00
1620
00
3120
00
1620
00
5434
00
R. GRAHAM A/C
Jan
Discount
75
00 Jan
Balance
Jan
Bank
PJ
1425
00 Jan
Purchases
Jan
31 Balance
C/D
1620
00
3120
00
Feb
Balance
B/D
R. GORDON A/C
Jan
11 R.
PJ
Outwards
452
00 Jan
Jan
31 Balance
4982
00
5434
00
C/D
Feb
10 Purchase
Balance
B/D
5434
00
4982
00
General Ledger
Date
Details
Folio
Amt $
Date
Details
Folio
Amt $
C/D
2000
00
2000
00
450
00
450
00
780
00
780
00
WAGES AND SALARIES A/C
Jan
Feb
15 Bank
Balance
B/D
2000
00 Jan
2000
00
2000
00
31
Balance
CARRIAGE OUTWARDS A/C
Jan
Feb
29
Balance
B/D
450
00 Jan
450
00
450
00
31 Balance
C/D
BAD DEPT A/C
Jan
Feb
30 J. James
Balance
B/D
780
00 Jan
780
00
780
00
31 Balance
C/D
DISCOUNT ALLOWED A/C
Jan
Feb
31 Total
Discount
Allowed
for the
month
Balance
B/D
125
00 Jan
125
00
125
00
31 Balance
C/D
125
125
00
00
General Ledger
Date
Details
Folio
Amt $
Date
Details
Folio
Amt $
Balance
C/D
1140
00
1140
00
350
00
350
00
SUNDRY EXPENSE A/C
Jan
Cash
290
00 Jan
Jan
28 Cash
850
00
1140
00
1140
00
Feb
Balance
B/D
31
CARRIAGE INWARDS A/C
Jan
Feb
Cash
Balance
B/D
350
00 Jan
350
00
350
00
31
Balance
C/D
SALES A/C
Jan
31 Balance
C/D
13,768
13,768
00 Jan
Cash
Jan
18 Cash
Jan
31 Total
Credit
Sales for
the month
00
1504
00
4664
00
7600
00
13,768 00
Feb
General Ledger
Balance
B/D
13,768 00
Date
Details
Folio
Amt $
Date
Details
Folio
Amt $
Balance
C/D
7000
00
7000
00
300
00
300
00
452
00
452
00
REFRIGERATOR A/C
Jan
Feb
31 Bank
Balance
B/D
7000
00 Jan
7000
00
7000
00
31
RETURN INWARDS A/C
Jan
Feb
31 Total
Return
Inwards
for the
month
Balance
B/D
300
00 Jan
300
00
300
00
31
Balance
C/D
RETURN OUTWARDS A/C
Jan
31 Balance
C/D
452
00
452
00
Jan
Feb
31 Total
Return
Outwards
for the
month
Balance
B/D
452
Folio
Amt $
General Ledger
Date
Details
Folio Amt $
Date
Details
PREMISES A/C
Jan
Balance
B/F
130,000 00 Jan
31
Balance
C/D
130,000 00
Feb
Balance
B/D
130,000 00
130,000 00
130,000 00
FIXTURES AND FITTINGS A/C
Jan
Feb
Balance
Balance
B/F
B/D
25,000
00 Jan
25,000
00
25,000
00
31
Balance
C/D
25,000
00
25,000
00
400
00
400
00
DRAWINGS A/C
Jan
Feb
24 Cash
Balance
B/D
400
00 Jan
400
00
400
00
31 Balance
C/D
PURCHASES A/C
Jan
Feb
31 Total
Credit
Purchases
for the
month
Balance
B/D
7054
00 Jan
7054
00
7054
00
31 Balance
C/D
7054
00
7054
00
General Ledger
Date
Details
Folio
Amt $
Date
STOCK A/C
Details
Folio
Amt $
Jan
Feb
Balance
Balance
B/F
B/D
12,000
00 Jan
12,000
00
12,000
00
31
Balance
C/D
12,000
00
12,000
00
180,610
00
180,610
00
180,610
00
CAPITAL A/C
Jan
31 Balance
B/F
180,610 00 Jan
26
Balance
B/F
180,610 00
Feb
Dr.
Balance
B/D
Sales Ledger Control A/C
Cr.
Jan 1
Jan 31
Balance B/F
Sales for the month
$5600
$7600
Jan 31
Jan 31
Jan 31
Jan 31
Jan 31
Bank
Discount Allowed
Return Inwards
Bad Dept
Balance C/D
$4195
$125
$300
$780
$7800
$13,200
$13,200
Feb 1
Balance B/D
$7800
Dr.
Purchases Ledger Control A/C
Cr.
Jan 31
Jan 31
Jan 31
Jan 31
Capital
Cash
Bank
Purchases
Return Outwards
Bank
Discount Received
Balance C/D
$452 Jan 1
$1425 Jan 31
$75
$6602
$8554
Feb 1
Balance B/F
Sales for the month
$1500
$7054
Balance B/D
$8554
$6602
Trial Balance as at 31 January 2014
Debit $
Credit $
180,610
1788
5320
7054
Sales
M. Lane
M. Lyn
C. Browne
R. Graham
R. Gordon
Wages & Salaries
Carriage Inwards
Bad Dept
Discount Allowed
Sundry Expense
Carriage Outwards
Refrigerator
Return Inwards
Return Outwards
Premises
Drawings
Fixtures & Fittings
Stock
Discount Received
13,768
2400
500
4900
1620
4982
2000
350
780
125
1140
450
7000
300
452
130,000
400
25,000
12,000
75
201,507
201,507
Adjusted (Updated Cash Book)
Jan1
Jan
Balance B/F
Credit Transfer
(Bank Column only)
$5320 Jan
$750 Jan
Jan
Jan
$6220
Standing Order
Stamp Duty
Bank Charges
Balance C/D
$500
$50
$340
$5330
$6220
Feb1
Balance B/D
$5330
Bank Reconciliation Statement as at 31 January 2014
Balance as per adjusted Cash Book
Add Unpresented Cheques
Less late Lodgements
Balance as per bank statement
$5330
$450
$5780
$1820
$3960
Trading Profit and Loss A/C for month ended 31 Jan 2014
Sales
13,768
Less Return Inwards
300
Net Sales
Less COGS:
13,468
Opening Stock
Add Purchases
Add Carriage Inwards
Gross Purchases
Less Return Outwards
Net Purchases
12,000
7054
350
7404
452
6952
Cost of goods available for sale
18,952
Less Closing Stock
10,400
COGS:
Gross Profit
Add Revenue:
Discount Received
8552
4916
75
4991
Less Expenses:
Carriage Outwards
Discount Allowed
Wages & Salaries (2000-250)
Sundry Expense (1140 +150)
Bad dept
Prov. For Bad dept
450
125
1750
1290
780
33
(5/100x
7800=390/12=32.50)
Depreciation
Fixtures & fittings
104
(5/100x25000=1250/12=104.17)
Refrigerator (10/100x7000=700/12=58.33)
58
4590
401
Net Profit
Balance Sheet as at 31 January 2014
$
Fixed assets
Premises
130,000
Fixtures & Fittings
Less Depreciation
25,000
104
24,896
Refrigerator
Less Depreciation
7000
58
6942
161,838
Current Assets
Stock
Trade Debtors
Less Prov. For Bad
Dept
10,400
7800
33
7767
5320
250
1788
25,525
Cash at Bank
Prepaid Expenses
Cash
Less Current liability
Trade Creditors
Accrued Expense
6600
150
6752
18,773
180,611
Financed by :
Capital
Add Net Profit
Less Drawings
180,610
401
181,011
400
180,61
Ratio Analysis and Interpretation of Results
Working Capital Ratio
Comparison made: Opening vs. Closing
Working Capital: Current Assets Current Liabilities
= $27,110 - $25,610
This reveals that at the beginning of the month the working capital was $27,110,
however at the end it was reduced by $1,500 to $25,610 a decrease of 5.5%
Solvency Ratio
(a)Current Ratio
Opening:
Current Assets
Current Liabilities
$ 27,110
= $ 1,500
=18:1
Current Assets
Closing: Current Liabilities
=
$ 25,525
$ 6,752
= 4:1
This means that at the beginning of the month there were enough current assets
to pay off current liabilities 18 times. However at the end of the month this was
reduced to 4 times so to every 1 liability it could be paid off only 4 times.
(b)Acid Test Ratio
Comparison made: Opening vs. Closing
Current AssetsStock
Current Liabilities
Opening:
Closing:
Current AssetsStock
Current Liabilities
$ 27,110$ 12,000
1,500
$ 25,525$ 10,400
$ 6,752
$ 15,110
$ 1,500
= 10:1
$ 15,125
$ 6,752
= 2:1
This means that at the beginning of the month there were enough liquid assets
to cover liabilities 10 times. However at the end of the month this was reduced
to 2 times resulting in assets being able to pay off liabilities only 2 times.
Gross Profit as a Percentage of Sales
Formula:
Gross Profit
100
Net Sales
4,916
= 13,468 100
= 35.5%
This means that for every $100 of sales, $35.50 gross profit was made before any
expenses were paid and contributed to net profit.
Net Profit as a Percentage of Sales
Formula:
Net Profit
100
Net Sales
401
100
13,468
=3%
This means that for every $100 of sales, Mias owner is gaining 3%
Gross Mark-Up
Formula:
Gross Profit
100
Cost of goods sold
$ 4,916
100
$ 8,552
= 57.5%
This shows how much gross profit is made for every $100 spent on buying goods
for resale. This means that the mark up was adequate to arrive at the selling price
Turn Over Ratio
Formula:
Cost of goods sold
Average Stock
Average Stock =
Opening Stock+Closing Stock
2
$ 8,552
= $ 11,200
= 0.76
$ 12,000+ $ 10,400
2
$ 22,400
2
= $11,200
This means that stock is being converted into sales less than 1 time during the
month of January.
Debtor Ratio
This measures the length of time taken for debtors to pay Mias.
=
Debtors
31
Sales for t h e year
$ 7,800
= $ 13,768 31
=18 days
This means that Mias Wholesale & Retail took 18 days to collect outstanding
funds from their credit customers.
Creditor Ratio
This measure the length of time taken by Mias to pay their suppliers.
=
Creditors
31
Purc h ases for t h e year
$ 6,602
= $ 7,054 31
= 29 days
This means that it took Mias Wholesale & Retail 29 days to pay their suppliers.
Expenses as a Percentage of Sales
Formula:
Expenses
100
Sa les
$ 4,590
100
$ 13,768
= 33.3 %
This shows what percentage of sales is an individual expense to Mias.
Return on Capital Employed Ratio
Formula:
Net Profit
100
Capital Employed
Capital =
Opening Capital+ClosingCapital
2
$ 401
= $ 180,611 100
=0.22%
($ 180,610+ $ 180,611)
2
$ 361,221
2
= $180,611
This means that Mias received a net profit of only 22 per $100.
Mias
Wholesale& Retail
Name: Tamia Mclean
Subject: POA
Centre Number: 100033
Territory: Jamaica
Date Submitted:
Pool: 5:3
TABLE OF CONTENT
Acknowledgement1
Aim of the Project..2
Statement of Affairs..3
Opening Entries.4
BOOKS OF ORIGINAL ENTRIES
Sales Journal..5
Purchases Journal...5
Return Inwards Journal..5
Return Outwards Journal...5
Cash Book..6
Sales Invoice...7
Receipt....8
LEDGERS
Sales Ledger...9
Purchases Ledger...10
General Ledger..11-15
CONTROL ACCOUNTS
Sales Ledger Control A/C..16
Purchases Ledger Control A/C..16
Trial Balance..17
Updated Cashbook18
Bank Reconciliation Statement..18
Trading Profit and Loss A/C..20
Balance Sheet..21
Ratio Analysis & Interpretation of Results... ..22-25
BOOKS OF
ORIGINAL
ENTRY
LEDGERS
CONTROL
ACCOUNTS
ACKNOWLEDGEMENT
I am using this opportunity to express my gratitude to everyone who supported me
throughout the course of this School Based Assessment. I am thankful for their
aspiring guidance, invaluable constructive criticism and friendly advice during this
project. I am sincerely grateful to my Principles of Accounts teacher Mrs. Williams
and to God for giving me the strength and understanding to complete this
assignment.
Aim of the Project
The aim of my project is for me to arrive at a comprehensive understanding of the
financial sector of the business world. To draw up the financial records for the year
2014 for Mias Wholesale and Retail and to comment on the entitys performance
using appropriate tools of Analysis.
