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Accounting for Business

Journalizing these transactions is quite relevant since most of these transactions are very vital to the business. These transactions make the business to achieve its sole interest in the long run. Such transactions help the business to attract more people in the long run. This creates a better understanding of the issues that affect the business performance. In most cases, these transactions are recorded in a single journal. This is useful as it gives the users a clear look of how the business is performing. The journals well organized can help to create a better and accessible way to attract more customers. The transactions are clear and hence easy to elaborate. The journals are actually the best to represent the accounting information to its users worldwide since they employ similar rules and procedures.

In most businesses, there is always a need to represent the accounting in an orderly manner. This creates a better way that is quite affordable to all businesses. Through these, there is a better approach that is easily adopted and hence there is accuracy and consistence in the information.

Dr                   Cash at bank               Cr

Capital    15,000      Rent             590

Revenue    1,530      Equipment   3,000

Receivable   40         Supplies         250

Revenue 1,330    Insurance      190

Telephone    60

Dr                 account receivable        Cr

Revenue 70       Bank       40

Revenue 60

Dr                   supplies                       Cr

Payable     250

Payable        70

Dr                   equipment                   Cr

Cash      3,000

Loan       4,000

Dr                 accounts payable           Cr

Bank         250          Supplies    250

Dr                   loan payable               Cr

Equipment 4000

Dr                 A.Majild capital            Cr

Bank         15,000

Dr                 revenue                         Cr

Bank 1,530

Bank    1,330

Receivable 70

Receivable 60

Dr               rent expense                    Cr

Bank               790

Dr        Insurance expense             Cr

Bank        190

Dr       telephone expense                   Cr

Bank         60

This is the other part that is very essential to the finalizing of the accounts. The general journal has very essential elements that are considered in accounts. This is quite necessary since the development of every business is crucial. In the real definition of general journal, it is wise to include the debit and credit side of the transactions. This will lead to better and reliable results in the final financial statements. The reliability of general journal relies on the figures obtained from the other ledgers. In actual terms, there is a lot success in businesses that adopt general ledgers as compared to those which do not. This is actually the best approach in the long run.

ACCOUNT: Cash at Bank Account No. 1-101
Date Explanation Post Ref Debit Credit Balance
2012
Rent 590
Equipment

Supplies

Insurance

Telephone

Capital

Revenue

Receivable

Revenue

15,000

1,530

40

1,330

3,000

250

190

60

13,610

ACCOUNT: Accounts Receivable Account No. 1-102
Date Explanation Post Ref Debit Credit Balance
Revenue

Revenue

Bank

70

60

40

110

ACCOUNT: Supplies Account No. 1-110
Date Explanation Post Ref Debit Credit Balance
Payable 250
Payable 70
320
ACCOUNT: Equipment Account No. 1-120
Date Explanation Post Ref Debit Credit Balance
Cash 3,000
Loan 4,000 7000
ACCOUNT: Accounts Payable Account No. 2-101
Date Explanation Post Ref Debit Credit Balance
Supplies 250
Bank 250
ACCOUNT: Loan Payable Account No. 2-110
Date Explanation Post Ref Debit Credit Balance
Equipment 4,000 4,000
ACCOUNT: A. Majild, Capital Account No. 3-101
Date Explanation Post Ref Debit Credit Balance
Bank 15,000 15,000
ACCOUNT: Revenue Account No. 4-101
Date Explanation Post Ref Debit Credit Balance
Bank 1,530
Bank 1,330
Receivable

Receivable

70

60

2,990

ACCOUNT: Rent Expense Account No. 5-110
Date Explanation Post Ref Debit Credit Balance
Bank 790 790
ACCOUNT: Insurance Expense Account No. 5-120
Date Explanation Post Ref Debit Credit Balance
Bank 190 190

ACCOUNT: Telephone Expense

Account No. 5-130
Date Explanation Post Ref Debit Credit Balance
Bank 60

The trial balance is used by most business to show the transactions that have taken place within a month. In actual terms, the business has created the use of the trial balance to help improve on the quality of information that is given by the accountant. This is prepared at the end of each month. The trial balance in actual sense is meant to give the best approach to draw balance sheet. The figures used here are from the general journal. They are actually correct and represent the final details.

ANG MAJILD, BOAT HIRE

Trial Balance

as at 30 November 2012

  Account Account No. Debit Credit  
  Cash at bank 1-101  13,610    
  Accounts receivable 1-102 110    
  Supplies 1-110 320    
  Equipment 1-120 7.000    
  Accounts payable 2-101         0  
  Loan payable 2-110   4,000  
  A. Majild, Capital 3-101   15,000  
  Revenue 4-101   2,990  
  Rent expense 5-110  790    
  Insurance expense 5-120 190    
  Telephone expense 5-130  60    
      22,080    

These are final statements that are very important to the business as they ensure that the final figures are correct. They show the real profits of the business. They are the best statements to the investors for decision-making purposes.

ANG MAJILD, BOAT HIRE

INCOME STATEMENT

FOR THE YEAR ENDED NOVEMBER 2012

$ $
 Income 1,050
Less Expenses:
      Rent 340
      Wages 400 740
Profit $ 310
  • Statement of Changes in Equity
ANG MAJILD, BOAT HIRE

STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED NOVEMBER 2012

$
Capital contributions 40 000
Add: Profit 310
40 310
Less: Drawings   150
Closing Capital $ 40 160

(vii)     Balance Sheet (Statement of Financial Position)

ANG MAJILD, BOAT HIRE

BALANCE SHEET

AS AT NOVEMBER 2012

$ $
ASSETS LIABILITIES
Cash at Bank 29,660 A/c’s Payable 2,500
Computer Equipment 3,000
Vehicles 10,000 EQUITY 40,160
TOTAL $ 42,660 TOTAL $ 42,660