Acc1Ais : Accounting And Information Assessment Answer

1. A Trial Balance report dated 30th May 2018. This is your ‘unadjusted’ Trial Balance.
2. A Journal Report for 31st May 2018. An example from Demo Company is shown below. 

3. A Profit and Loss report for the period 1st May 2018 to 31st May 2018.
4. A Balance Sheet report as at 31st May 2018
5. A professionally presented short written report (maximum 1,000 words) designed for an
internal user of the accounting information. Your report will explain the financial results for
May. It is up to you to decide what information you include in your report and how you
conduct the analysis. You must include at least 2 graphs of financial data in your report. 

The trial balance is prepared by company for serving the purpose of detecting any mathematic errors that have been encountered in the system of double entry accounting. Trail balance is considered to be balanced if the total credits equal to total debits which is indicative of the fact that the ledgers are free from any mathematical errors or it can be any errors in calculation. For the transactions that have occurred in the month of May for 18770299 Yadgir Singh, trail balance is prepared. The amount of sales made by company is presented in the trial balance and the total sales generated are recorded at $ 9829. On other hand, cost of goods sold has a direct im

pact on product cost of goods which the business sells to customers. The total amount of cost of goods sold is recorded at $ 5932. Furthermore, trial balance incorporates all the items that are associated with business transactions during a particular time and in this case, the statement is prepared for month of May. The item that is listed in preparation of trial balance includes owner’s capital, liabilities, expenses incurred by business and assets. As presented in the section of appendix, the total amount of trial balance that makes the debit side equivalent to credit side is recorded at $ 566660.

The profit and loss account is prepared for accounting the net loss or profit generated by business during a particular time. Trail balance depicts the particulars that are required for preparing the profit and loss account. Total amount of income earned and the loss that the business incurs is summarized in the statement of profit and loss. It can be seen from the profit and loss statement of 18770299 Yadgir Singh that the business has incurred loss of amount of $ 2822 during that particular month. The reason that can be considered for incurring such loss is an increase in operating expenses of business that is considerably huge and the amount stood at $ 7425. The pie chart helps in analysis and classification of operating expenses that forms a part of loss generated by business.

                                                          Figure 1: (Pie Chart presenting the expenses for Month of May)

                                                                                     (Source: (Created by Author)

The total amount of operating expenses that is incurred by business during that particular month is depicted in the pie chart and the total amount incurred by business stood at $ 7,425. For the operating expenses, the major proportion is attributable to the amount of rent that is paid by organization. The total amount of rent that has been incurred is recorded at $ 4545. The expenses incurred on rent are considered to be the fixed expenses of business and it accounts for about 61% of the total expenses incurred by company. On other hand, interest expense that is incurred by business comprise of 28% of total operating expenses and the total amount of operating expenses that are incurred in conducting the business operations is recorded at $ 2042. Furthermore, the amount of interest expenses comprise of the loan taken by business that is recorded under the liabilities section of balance sheet. Expenses incurred on motor vehicle and depreciation expenses are some other forms of expenses that are incurred by business while carrying out their operational activities. Depreciation is a method account that is used by business for allocating the tangible assets cost over its useful life. It is the expenses that are incurred by business for which there is not outflow of cash as it is a non cash expense. Furthermore, expenses incurred by company on part of motor vehicle are the amount that is incurred on maintenance of such assets. Total amount of depreciation that is attributable to company is recorded at $ 306 along with the expenses that is incurred on motor vehicle at the amount of $ 531.

The balance sheet is prepared for presenting the true financial position or financial performance of company during a particular financial year. It summarizes the total of liabilities and assets during any particular reporting period. In case of this particular organization, preparation of balance sheet is done. All the assets that are possessed by business are reported under the assets side and all liabilities attributable are reported under the liabilities side. Some of the most liquid assets possessed by business are incorporated under the current assets of business. Total amount of cash reported under the bank balance is recorded at $ $ 416,140.78 as presented by the balance sheet figures in appendix section. Some of the current assets of company include accounts receivable and inventories.

                                                   Figure 2: (Bar Graph presenting Current Assets for month of May)

                                                                           Source: (Created by Author)

The bar graph presented above depicts the total items that forms the current assets includes interest receivable, accounts receivable, office supplies, inventories, prepaid rent and prepaid advertising. Prepaid rent, prepaid expenses and prepaid advertisement are the items under current assets that form the major proportion of current assets and the total amount stood at $ 22,727.27. Total amount of inventory stood at $ $ 12,468.10 that forms a considerable part of current assets of business. Total amount of liabilities on other hand is recorded at $ 833.26 which is at negative value. Business loan taken by organization forms the major portion of liabilities for which the amount stood at $ 350000. It can be seen from the appendix section that the accounting basis of preparation of balance sheet is double entry accounting system that equates the total side of assets with that of liabilities.

Introduction:

The report is prepared for demonstrating the evaluation of financial statements of18770299 Yadgir Singh for gaining an in depth knowledge related to several book of accounts. It can be seen that business of company are involves in transactions that are related to usual functioning of business. The main activities of company are to carry out the trading of shares or stocks and engagement in trading activities. Several transactions in which the business is involves is recorded and presented in the books of account by passing it as journal entries. The section of appendix presents the various financial statements of.

Reference:

Libby, R., 2017. Accounting and human information processing. In The Routledge Companion to Behavioural Accounting Research (pp. 42-54). Routledge.

Romney, M.B. and Steinbart, P.J., 2014. Accounting information systems. Pearson Higher Ed.