Advanced financial accounting - Lecture 4: Single entry

Advanced financial accounting - Lecture 4: Single entry. The main topics covered in this chapter include: company name balance sheet; fixed assets; owner’s equity and liabilities; company name statement of affairs; creditor’s account; debtor’s account; company name income statement;... Please refer to the lecture for details!

Advanced Financial  Accounting

FIN­611  

Mian Ahmad Farhan 

Lecture­4 Single Entry

Current Assets 

Debtors  xxx

Prepaid expenses xxx

Accrued income  xxx

Bank balance  xxx

Company Name  Balance Sheet

As on 31st December ­­­­­­ 

Add During the year additions  xxx Less Disposal of an asset xxx

xxx Less Depreciation   xxx

Opening Balance Rs. 1,000

Furniture purchased  Rs. 500

(Use six months )

Depreciation charged by 10% per annum

Find out  amount of depreciation and Closing balance of furniture.

Depreciation:

Opening balance (1000 x 10%)   = 100 Furniture purchased (500 x 10% x 6/12) =   25 

     125

Closing Balance:

Less Depreciation         125

1,375

Add During the year purchased  xxx

Current Liabilities 

Creditors   xxx

Accrued  expenses xxx

Unearned income  xxx

Bank O/D  xxx

xxx

Company Name  Balance Sheet

As on 31st December ­­­­­­ 

Opening balance xxx    Statement of affairs 

Add Fresh capital  xxx      Cash book receipt side 

Less Drawings

Cash  xxx    Cash book payment side  Goods  xxx    Year end adjustment 

xxx

Opening balance      xxx   Statement of affairs 

Add Fresh loan obtained      

      during the year       xxx   Cash book receipt side Less Payment of Loan       (xxx)     Cash book payment side

Closing Balance  xxx  

Current Assets 

3,900  

Company Name  Statement of Affairs 

As on 31st December ­­­­­­ 

Receipts  Cash  Bank  Payments  Cash  Bank  Opening balance 

Receipts from 

debtors

Cash sales 

80

­­­­

500

1,130 9,500

Supplier (Payment 

to creditors) Rent   

General expenses Drawings

Closing balance 

­­­­

50

­­­­

520 10

7,200

200 180

­­­­ 3,050 Cash Book

Cash paid to 

creditors 

Closing balance

7,200 650

Opening balance  Credit Purchase

400 7,450

Creditor’s Account 

Opening balance 

Credit sales

1,100 9,720

Cash received from  debtors 

Closing balance 

9,500 1,320 Debtor’s Account 

Closing stock Rs. 1,700

Rent owing Rs. 50

Depreciation on fixture, 10% per annum    

10,220

Less Cost of goods sold

 7,340

Less Operating expenses

    560

Company Name  Income statement  

As on 31st December 2007 

Rent

Cash  50

Cheque   200

250 Add Owing    50

300

Assets  Amount  Owner’s Equity & 

Liabilities  Amount 

Fixed Assets

Fixtures      800

Less dep.         80

Current Assets

Closing stock  

Debtors

Bank 

720

1,700 1,320 3,050

Owner’s equity    4,300 Add NP       2,320 Less drawings        520

Liabilities

Creditors      650 Rent Due        50

6,100

700

Company Name  Balance Sheet

As on 31st December 2007