ASSIGNMENT TASK 1

Q 1.1
Principles
A. The accounting equation:
Through a very simple formula this helps in explaining in the financial statements of a
business entity.
.
ASSETS = LIABILITIES + CAPITAL
/
LIABILITIES = CAPITAL ASSETS
/
CAPITAL = ASSETS LIABILITIES
These are equations which helps us to calculate all the transactions of the accounting
periods. So it helps in making financial statement as well.
B. The nature of business entity:
If the nature of business is financial then its balance sheet will be different because
most of its expenses are done in profit and loss method so the balance will also be
different so making the financial statement is different for different business entity.
C. The cost period:
If the company receives its debts in a small time its balance sheet can show more
profit but if the company receive its debt in a longer period its balance sheet can show
more loss.
Concepts:
D. Relevant:
The data that is made should be relevant to what organisation has asked and should be
related to organisation.
E. Understandable:
The data which is created in the balance sheet or any other transaction which is
created by the company member they need to be create that information very clearly
and if someone try to read that information it easily for him to read all the information
perfectly.
F. Reliable:
The information or the transaction which we created for the financial statement should
be reliable and there is no problem to understand the concept.
G. Comparable:
The information and the balance sheets which we made it should be similar to the
other companies and easily compare with other companies because it should be
similar to other companies data or the information for the financial statements.
Because if anyone want to compare the information of those companies it will be
similar to each other.

H. Material:
All the expenses or the losses should be made it very important to clear these in the
balance sheets of revenue clearly. And the thing all the tangible and intangible assets
should be mentioned separately.
Q 1.2
Name of my company is JB Hi If:

A. Companies act 1993:

This act shows that small companies need to made their all the financial statements
separately format which was given to them according to transactions. That was already
created by the JB Hi Fi to complete their financial statements.
Commerce act 1986:
This act states that if the asset of the company that was decreased in their share that was on
sale or purchased by the competitors of the market because it is not allowed them to do the
business deals anymore. No company can sale or purchase the assets in this way.
B. Income tax Act 2007
This act states that every company has to show separately that they paid all the tax to
government according to the income of the company. Which this company shows like it is
advised.
C. Financial reporting act 1993
This act states that any multinational company has to report any big decisions to the
companies head office which this company does.

ASSIGNMENT TASK 2:

2.1.
a) Accounting equations

Date
1/11/14

Assets
Bank:
35,000

Expenses

5/11/14

Bank: 34500

Rent: 500

6/11/14

Bank:
22,500
Furniture:
12,000
Bank:
22,500
Furniture:
12,000
Equipment:
5,000
Bank:
14,500
Furniture:
12,000
Equipment:
5,000
Stock: 8,000
Bank:
14,500
Furniture:
12,000
Equipment:
5,000
Stock: 8,000
Accounts
Receivables:
2,500
Bank:
14,300
Furniture:
12,000

8/11/14

11/11/14

12/11/14

15/11/14

Drawings

Liabilities
Loan: 5000

Loan: 5000

Loan: 5000

Purchases:
8,000

Electricity
Bill: 200

Income

Equity
Owners
Capital
30,000
Owners
Capital
30,000
Owners
Capital
30,000

Loan:
5,000
Accounts
Payable:
5,000

Owners
Capital
30,000

Loan:
5,000
Accounts
Payable:
5,000

Owners
Capital
30,000

Loan:
5,000
Accounts
Payable:
5,000

Owners
Capital
30,000

Loan:
5,000
Accounts
Payable:

Owners
Capital
30,000

16/11/14

23/11/14

29/11/14

Equipment:
5,000
Stock: 8,000
Accounts
Receivables:
2,500
Bank:
14,300
Furniture:
12,000
Equipment:
5,000
Stock: 8,000
Accounts
Receivables:
2,500
Bank:
14,300
Furniture:
12,000
Equipment:
5,000
Stock: 8,000
Bank:
13,700
Furniture:
12,000
Equipment:
5,000
Stock: 8,000

5,000

Purchases:
6,400

Note: Every amount is in NZ $

b) General Journal Entries:

Loan:
5,000
Accounts
Payable:
11,400

Loan:
5,000
Accounts
Payable:
11,400

Drawings:
600

Loan:
5,000
Accounts
Payable:
11,400

Owners
Capital
30,000

Accounts
Receivables:
2500 Bad
Debts: 50

Owners
Capital
30,000

Owners
Capital
29,400

Date

Particulars

1/11/14

Bank A/c dr
To Equity Account
To Loan Account

Debit $
(NZD)
35,000

Credit $
(NZD)
30,000
5,000

5/11/14
6/11/14
8/11/14
11/11/14
12/11/14
15/11/14
16/11/14
23/11/14

29/11/14

Rent A/c dr
To Bank
Furniture A/c dr
To Bank
Equipment A/c dr
To Accounts Payables
Purchases A/c dr
To Cash
Accounts Receivable A/c dr
To Sales
Electricity A/c dr
To Bank
Purchases A/c dr
To Accounts Payable
Bank A/c dr
Bad Debts A/c dr
To Accounts Receivables
Drawings A/c Dr
To Bank

500
500
12,000
12,000
5,000
5,000
8,000
8,000
2,500
2,500
200
200
6,400
6,400
2,450
50
2,500
600
600

2.2. Classification of the ledger accounts:

a)
b)
c)
d)
e)
f)
g)
h)
i)
j)
k)
l)
m)
n)
o)
p)

Ledger Accounts
Plant and Machinery
Bank Balance
Interest Received
Discount allowed
Accounts Receivables
Bank Overdraft
5 Years Loan from Bank
Commission Received
Accounts Payable
Building
Sales
Profits
Drawings
Power Bill
Advertising
Investment

Classification
Non-Current Assets
Current Assets
Revenue
Expense
Current Assets
Current Liabilities
Non-Current Liabilities
Revenue
Current Liabilities
Non-Current Liabilities
Revenue
Revenue
Equity
Expense
Expense
Equity

2.3. a. Ledger accounts for the month of January:

Note: all the amounts are in NZ $

Bank Account
Dr
Dat
e
1
4
19
23
31

Particulars

Amount

Opening Balance
Sales
Accounts Receivables
4,500
Less: Bad Debts
-100
Rent A/c
Closing Balance

12,500
900

Dat
e
2
14
16
22
24
29
29

4,400
750
5090

31
_____
23,640

Particular

Amount

Electricity Bill A/c

Computer A/c
Telephone Bill A/c
Salary A/c
Sales Return A/c
Term Deposit @6% A/c
Accounts Payable A/c 600
Less: Discount
-50
Purchases

500
2,000
250
11,500
340
5,000
550
3,500
_____
23,640

Sales Account
Dr
Date
24
31

Particulars
Sales Return A/c
Closing Balance

Amount
340
560
___
900

Date
4

Particulars
Bank A/c

Amount
900
___
900

Purchases Account
Dr
Date Particulars
9
Accounts Payable
31 Bank A/c

Amount Date Particulars

1,800
31 Closing balance
3,500
____
5,300
Electricity Bill A/c

Amount
5,300
____
5,300

Dr
Date Particulars
2
Bank A/c

Amount
500

Date Particulars
31 Closing Balance

Amount
500

___
500

___
500

Computer Account
Dr
Date Particular
14 Bank A/c

Amount
2,000
____
2,000

Date Particular
31 Closing balance

Amount
2,000
____
2,000

Telephone Bill Account

Dr
Date Particulars
16 Bank A/c

Amount
250
___
250

Date Particulars
31 Closing balance

Amount
250
___
250

Salary Account
Dr
Date Particular
22 Bank A/c

Amount
11,500
_____
11,500

Date Particular
31 Closing Balance

Amount
11,500
_____
11,500

Rent Account
Dr
Date Particulars
31 Closing Balance

Amount Date Particulars

750
23 Bank A/c
___
750
Term Deposit Account

Amount
750
___
750

Dr
Date Particulars
29 Bank A/c

Amount
5,000
____
5,000

Date Particulars
31 Closing Balance

Amount
5,000
____
5,000

Machinery Account
Dr
Date Particulars
30 Monthly installment A/c

Amount
28,000
_____
28,000

Date Particulars
31 Closing balance

Amount
28,000
_____
28,000

Monthly instalment Account

Dr
Date Particulars
31 Closing Balance

Amount
28,000
_____
28,000

Date Particulars
30 Machinery A/c

Amount
28,000
_____
28,000

Sales Return Account

Dr
Date Particulars
24 Bank A/c

Amount
340
___
340

Date Particulars
24 Sales A/c

Amount
340
___
340

Accounts Receivables Account

Dr
Date Particulars
1
Opening Balance

Amount
32,600

_____
32,600

Date Particulars
19 Bank A/c
4500
31 Less: Bad Debts
-100
Closing Balance

Amount
4400
28,200
_____
32,600

Accounts Payable
Dr
Date Particulars
29 Bank A/c
550
31 Add: Discount
50
Closing Balance

Amount

Date Particulars
1
Opening Balance

600
8,800
____
9,400

Amount
9,400

____
9,400

Capital Account
Dr
Date Particulars
31 Closing Balance

Amount
33,300
_____
33,300

Date Particulars
1
Opening Balance

Amount
33,300
_____
33,300

Drawings Account
Dr
Date Particulars
1
Opening Balance

Amount
2,400
____
2,400

Date Particulars
31 Closing Balance

Amount
2,400
____
2,400

Trial Balance
Dr
Particulars
Bank
Purchases
Electricity
Computer
Telephone Bill
Term Deposit @ 6%

Amount
5090
5,300
500
2,000
200
5,000

Particulars
Sales
Rent
Machinery installment
Accounts Payable
Capital

Amount
560
750
28000
8,800
33,300

Accounts Receivable
Drawings

28,200
2,400
_____
48,690

_____
48,690

ASSIGNMENT TASK 3:

3.1. Classification of the accounts:

Accounts
Delivery Truck
Accrued Interest on Bank loan
Rent Received
Stock of Goods
Commission Received
Discount Allowed
Term Deposit
Bank loan Due in 3 Years

Classification
Investment Assets
Expenses
Income
Current Assets
Income
Expense
Current assets
Non Current Liabilities

Goodwill
Prepaid Insurance
Vehicle purchased for a Car Dealer

Intangible Assets
Current Assets
Investment Assets

3.2. Journal Entries:

Note: all the amounts are in NZ $

No.
a.
b.
c.
d.
e.

Particulars
Commission A/c dr
To Bank A/c
Bank A/c dr
To Rent A/c
Prepaid Insurance A/c dr
To Bank A/c
Interest A/c dr
To Bank A/c
Bank A/c dr
To Accumulated Depreciation A/c

Amount NZ $ (Dr)
200

Amount NZ $ (Cr)
200

400
400
500
500
100
100
4000
4000

Revised Trial Balance:

Dr
Particulars
Equipment Cost
Insurance Expenses
Rent Paid
5% Term Deposit

Amount $
36,000
6,500
3,600
10,000
56100

3.3. Revenue Statement:

Note: all the amounts are in NZ $

Particulars
Accumulated Depreciation
Commission Received
Interest on Term Deposit
Capital

Amount $
4,000
1,000
500
50600
56100

Particulars
Sales
Less: Sales Return
Net Sales
Less: Cost of Goods Sold
Gross Profit
Add: Incomes
Carriage inwards
Rent received
Total Income
Less: Expenses
Insurance
Salary and wages
Delivery van expenses
Bad Debts
Depreciation
Telephone Expenses
Electricity
Total Expenses

Calculations $
91,000
-3,400
-12200

Final Amount $

87600
___________
75400

1100
+5400
+6500
-1500
-37500
-1500
-1400
-8000
-1600
-6000
-57500
_____
24400

Profit for the year

Balance Sheet for the year Ended 31st March 20X3:

Particulars
Current Assets:
Cash at Bank
Accounts Receivable
Add: Bad Debts
Stock of Goods
Accrued Interest
Prepaid Insurance

Calculations $

Final Amount $

12700
9400
1400
7800
233.33
(1500)

Total Current Assets

Property Plant & Equipment

30033.33
50000

Total Assets

80033.33

Current Liabilities:
Accounts Payable
Accrued Electricity
Accrued Rent

2300
(300)
(600)

Total Current Liabilities

(1400)

Non Current Liabilities:

Loan from Bank

(20233.33)
_____
58400
_____
58400

Net Assets
Closing Capital
Property plant and Equipment
Original Cost
Accumulated Depreciation
Depreciation for the year
Accumulated Depreciation
Carrying out

Equipment $
20000
4000
2000
6000
_____
14000

Vehicles $
60000
18000
6000
24000
_____
36000

Total Amount $
80000
22000
8000
30000
_____
50000

Changes in Equity
Particulars
Opening Capital
Add: Contribution during the year
Less: Drawings
Add: Profit of the Year
Closing Capital of 31st March 20X3

3.4. General Journal of Canterbury Caterers as at 1st April 20X3

Note: all the amounts are in NZ $

Amount
39,000
+5000
-10000
+24400
_____
58,400

Date
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3
1st April 20X3

Particulars
Amount $ Dr
Cash at Bank
3,000
Accounts Receivable
6,000
Opening Stock of Goods
12,500
Prepaid Insurance
500
Premises
120,000
Delivery Vehicles
40,000
Catering Equipment
70,000
To Bank Overdraft
To Accounts Payable
To Outstanding Electricity Bill
To Advanced Fees Received
To Loan from Bank
To Accumulated Depreciation on Premises
To Accumulated Depreciation on Delivery
Vehicles
To Accumulated Depreciation on Catering
Equipment
To Capital
252000

Amount $ Cr

4000
7,000
1,000
3,000
30,000
40,000
23,000
33,000
111,000
25,2000

Ledger Accounts
Note: all the amounts are in NZ $

Bank Account
Dr
Date
1/4/X3

Particulars
Balance

Amount $
3,000

Date

Particulars

Amount $

Accounts Receivable Account

Dr
Date
1/4/X3

Particulars
Balance

Amount $
6,000

Date

Particulars

Amount $

Opening Stock of Goods Account

Dr
Date
1/4/X3

Particulars
Balance

Amount $
12,500

Date

Particulars

Amount $

Prepaid Insurance Account

Dr
Date
1/4/X3

Particulars
Balance

Amount $
500

Date

Particulars

Amount $

Particulars

Amount $

Premises Account
Dr
Date
1/4/X3

Particulars
Balance

Amount $
120,000

Date

Delivery Vehicles Account

Dr
Date
1/4/X3

Particulars
Balance

Amount $
40,000

Date

Particulars

Amount $

Catering Equipment Account

Dr
Date
1/4/X3

Particulars
Balance

Amount $
70,000

Date

Particulars

Amount $

Particulars

Amount $

Bank Overdraft Account

Dr
Date
1/4/X3

Particulars
Balance

Amount $
4,000

Date

Accounts Payable Account

Dr
Date
1/4/X3

Particulars
Balance

Amount $
7,000

Date

Particulars

Amount $

Outstanding Electricity Bill Account

Dr
Date
1/4/X3

Particulars
Balance

Amount $
1,000

Date

Particulars

Amount $

Advanced Fees Received

Dr
Date
1/4/X3

Particulars
Balance

Amount $
3,000

Date

Particulars

Amount $

Loan from Bank Account

Dr
Date
1/4/X3

Particulars
Balance

Amount $
30,000

Date

Particulars

Amount $

Accumulated Depreciation from Premises Account

Dr
Date
1/4/X3

Particulars
Balance

Amount $
40,000

Date

Particulars

Amount $

Accumulated Depreciation from Delivery Vehicles Account

Dr
Date
1/4/X3

Particulars
Balance

Amount $
23,000

Date

Particulars

Accumulated Depreciation from Catering Equipment Account

Dr

Amount $

Date
1/4/X3

Particulars
Balance

Amount $
33,000

Date

Particulars

Amount $

Particulars

Amount $

Capital Account
Dr
Date
1/4/X3

Particulars
Balance

Amount $
111,000

REFERENCE:

1. www.google.com
2. www.wikipedia.org
3. Learning Resource of US 1852

Date