Year 6 Year 7 Year 8 Year 9

Current Assets $1,529 $1,711 $1,684 $1,780

Noncurrent Assets 9,136 9,180 9,196 10,143
Total Assets 10,665 10,891 10,880 11,923
Current Liabilities 1,289 1,352 1,421 1,501
Noncurrent Liabilities 4,722 4,815 4,630 6,380
Shareholders' Equity 4,654 4,724 4,829 4,042
Total Liab. and Shareholders' Eq. 10,665 10,891 10,880 11,923
Current Assets ÷ Current Liabilities 1.186 1.266 1.185 1.186

Copyright © 2023, R. Radhakrishna

 Assets Liabilities & Equity
TR Cash Machine Inventory Bank Loan Sh. Eq. RE
1 5,000 5,000
2 10,000 10,000
3 (4,000) 4,000
4 (2,500) 2,500
5 3,000 (2,000) 1,000
Total 11,500 4,000 500 10,000 5,000 1,000

TRADITIONAL LEDGER
CASH Machine Inventory
5,000
10,000
4,000 4,000
2,500 2,500
3,000 2,000
18,000 6,500 4,000 0 2,500 2,000
11,500 4,000 500

Bank Loan Sh. Equity Retained Earnings

5,000
10,000

1,000
0 10,000 0 5,000 0 1,000
10,000 5,000 1,000
Notes Seq
1
Cash went up (LHS Up = Debit); Sh. Eq. went up (RHS Up = Credit)
Cash went up (LHS Up = Debit); Liability (Bank Loan) went up (RHS Up = Credit)
Cash went down (LHS down = Credit); Other Asset (Machine) went up (LHS Up = Debit) 2
Cash went down (LHS down = Credit); Other Asset (Inventory) went up (LHS Up = Debit)
Sold inventory costing 2,000 for 3,000, making a profit of 1,000
3

In a ledger, if an account is debited, the amount is put on the left hand side of the T;
if an amount is credited, it is put on the right-hand side of the T

At the end each side is totaled and a balance put on the side which has the higher total.
Asset accounts have balance on the left hand side (Debit balances)
Libility and Equity accounts have balance on right hand side (Credit balances)

Each column of the spreadsheet mimics a traditional ledger account.

Each row of the spreadsheet mimics a journal entry (debit/credit for the transaction)
DR/CR Account DEBIT CREDIT
Dr. Cash 5,000
Cr. Shareholder's Equity 5,000

Dr. Cash 10,000

Cr. Bank Loan 10,000

Dr. Machine 4,000

Cr. Cash 4,000

Dr. Inventory 2,500

Cr. Cash 2,500

Dr. Cash 3,000

Cr. Inventory 2,000
Cr. Retained Earnings 1,000
Transactions
1. John stated a garden supplies business called Jayco with $25,000 capital.
2. The business took a loan from his aunt of $25,000
3. John bought a delivery van for his business $32,000
4. John bought garden supplies costing $40,000. He paid $20,000 immediately, and agreed to pay $20,000 next month.
5. John sold supplies costing $25,000 for $32,000.
Required: Record all transaction in the equation format. Also record them as journal entries (Debit/Credit).
Find the final balance in each account after the transactions (a) from the spreadsheet, and (b) from the traditional ledger acco

Accounts
Delivery Garden Payable - Loan from Share Retained
TR Cash Van Supplies Supplier Aunt Capital Earnings Check
1 25,000 25,000 0
2 25,000 25,000 0
3 -32,000 32,000 0
4 -20,000 40,000 20,000 0
5 32,000 -25,000 7,000 0
TB 30,000 32,000 15,000 20,000 25,000 25,000 7,000 0

Jayco
Balance Sheet for month ending xx
(In $)
Cash 30,000
Delivery Van 32,000
Garden Supplies 15,000
Total Assets 77,000

Accounts Payable - Supplier 20,000

Loan 25,000
Total Liabilities 45,000
Share Capital 25,000
Retained Earnings 7,000
Total Equity 32,000
Liability & Sh. Equity 77,000

Cash Delivery Van Garden Supplies

25,000
25,000 32,000 40,000
32,000 25,000
20,000 32,000 0 40,000 25,000
32,000 32,000 15,000
 82,000 52,000
30,000

Accounts Payable Loan Share Capital

20,000 25,000 25,000

0 20,000 0 25,000 0 25,000

20,000 25,000 25,000
pay $20,000 next month.

Debit/Credit).
rom the traditional ledger accounts.

JOURNAL ENTRIES
Tr Description DR CR
1 Cash 25,000
Share Capital 25,000

2 Cash 25,000
Loan from Aunt 25,000

3 Delivery Van 32,000

Cash 32,000

4 Garden Supplies 40,000

Cash 20,000
Accounts Payable 20,000

5 Cash 32,000
Inventory 25,000
Retained Earnings 7,000
Retained earnings

7,000
0 7,000
7,000
Transactions
1. Bob started a business selling surfboards with $20,000 capital
2. He bought 20 surfboards for $200 cash each
3. He built a little shack on the beach where he could store and sell the surfboards. It cost bim $10,500 to build the shack.
4. He sold 11 surboards for $300 each during the month.

Required: Record all transaction in the equation format. Also record them as journal entries (Debit/Credit).
Find the final balance in each account after the transactions (a) from the spreadsheet, and (b) from the traditional ledger acco

TR Cash SurfboardsShack Capital RE Check

1 20,000 20,000 0
2 -4,000 4,000 0
3 -10,500 10,500 0
4 3,300 -2,200 1,100 0
0
TOTAL 8,800 1,800 10,500 20,000 1,100 0

Bob
Balance Sheet as of
(In $)
Cash 8,800
Surfboards 1,800
Shack 10,500
Total Assets 21,100

Capital 20,000
Retained Earnings 1,100
Total Shareholders' Equity 21,100
Total Liabilities & Equity 21,100

Cash Surfboards Shack

20,000
4,000 4,000
10,500 2,200 10,500
3,300 4,000 2,200 10,500 0
1,800 10,500
23,300 14,500
8,800

Capital Retained Earnings

 20,000

1,100
0 20,000 0 1,100
20,000 1,100
0,500 to build the shack.

bit/Credit).
m the traditional ledger accounts.

JOURNAL ENTRIES
TR. DESCRIPTION DEBIT CREDIT
1 Cash 20,000
Share Capital 20,000

2 Surfboards 4,000
Cash 4,000

3 Shack 10,500
Cash 10,500

4 Cash 3,300
Surfboards 2,200
Retained Earnings 1,100
Using the information below calculate the ending total asset of Lisa Inc.
Lisa Inc raises $3,000 of shareholders’ equity
Lisa Inc purchases a building worth $300 for cash
Lisa Inc takes out a loan for $500 and receives cash
Lisa Inc purchases $300 of inventories, the supplier gives her credit
Lisa Inc generates cash sales of $400, which cost her $300

Answer: $3,900