Mias Wholesale & Retail

Statement of Affairs as at 31 December 2014

$
Fixed assets
Premises
Fixtures & Fittings

Current assets
Stock
Debtors
Bank
Cash

Less current liability

Creditors

Net current assets

Financed by :
Capital

$
130,000
25,000
155,000

12,000
5,600
9,000
510
27,110
1,500

25,610
180,610
180,610

OPENING JOURNAL ENTRIES

Journal
Date
2014
January 1

Details
Premises
Fixtures
Stock
Debtors M. Lyn
J. James
Bank
Cash
Creditors R. Graham
Capital

Folio
GL
GL
GL
SL
SL
CB
CB
PL
GL

Dr.
$
130,000
25,000
12,000
3,000
2,600
9,000
510

182,110

Cr.
$

1,500
180,610
182,110

Sales Journal
Details
Folio Debit $
1 M. Lane
SL
2,700
29 C. Browne
SL
4,900
31 Transfer to sales GL
a/c

Date
January
January
January

Date
January
January
January

Details
3 R. Graham
10 R. Gordon
31 Transfer to
purchases a/c

Date
January
January

Date
January
January

1
7
3
1

Purchases Journal
Folio Debit $
PL
PL
GL
7,054

GL

300

Credit $

7,600

00

Credit $
1620
5,434

00
00

00

Return Inwards Journal

Details
Foli Debit $
o
M. Lane
SL
Transfer to
R.I. a/c

00
00

Credit $

300

0
0

0
0

Return Outwards Journal

Details
Foli Debit $

o
11 R. Gordon
PL
452
0
0
3 Transfer to
GL
1 R.O. a/c

Credit $

452

00

Date

Details
Cash
Bank
Stock
Premises
Fixtures and
Fittings
Debtors
Creditors
Capital

General Journal
Folio
Debit $
510
9000
12000
130000
25000
5600
182110

00
00
00
00

Credit $

1500
180610
182110

00
00
00

00
00

CASH BOOK
Date

Details

Folio D.A

Cash

Bank

Date

Details

Folio

Jan 1

Balance

B/F

$510

$9,000

Jan 7

GL

Jan 6

Sales

GL

$1,504

Jan 7

Carriage
Inwards
R. Graham

Jan 18

Sales

GL

$4,664

Jan 9

GL

Jan 26

M. Lyn

SL

Jan 30

J. James

Jan 31

Cash

$75

$2,375

Jan 13

SL

$1,820

Jan 15

Wages

GL

$3,000

Jan 24

Drawings

GL

$400

Jan 28

GL

$850

Jan 31

Sundry
Expense
Carriage
Inwards
Bank

$3,000

Jan 31

Balance

C/D

$1788

$125

$125
Balance

$350

Sundry
Expense
Refrigerator

Jan 29

Feb 1

PL

D.R Cash

B/D

$6678

$16,195

$1788

$5320

$290

GL

GL

$75

$6678

Sales Ledger
Date

Details

Folio

Amt $

Date

Details

Folio

Amt $

M. LANE A/C
Jan

Feb

Sales

Balance

SJ

B/D

2700

00 Jan

17

R.
Inwards

SJ

300

00

Jan

31

Balance

C/D

2400

00

2700

00

2700

00

2400

00
M. LYN A/C

Jan

Feb

Balance

Balance

B/F

B/D

3000

00 Jan

26

Bank

2375

00

Jan

26

Discount

125

00

Jan

31

Balance

C/D

500

00

3000

00

4900

00

4900

00

3000

00

500

00
C. BROWNE A/C

Jan

Feb

29 Sales

Balance

SJ

B/D

4900

00 Jan

4900

00

4900

00

31 Balance

C/D

J. JAMES A/C
Jan

Balance

B/F

2600

Jan

30 Bank

Jan

30 Bad Debt

1820

00

780

00

2600

00

2600

00

Purchases Ledger
Date

Details

Folio

Amt $

Date

Details

Folio

Amt $

B/F

1500

00

1620

00

3120

00

1620

00

5434

00

R. GRAHAM A/C
Jan

Discount

75

00 Jan

Balance

Jan

Bank

PJ

1425

00 Jan

Purchases

Jan

31 Balance

C/D

1620

00

3120

00
Feb

Balance

B/D

R. GORDON A/C
Jan

11 R.
PJ
Outwards

452

00 Jan

Jan

31 Balance

4982

00

5434

00

C/D

Feb

10 Purchase

Balance

B/D

5434

00

4982

00

General Ledger
Date

Details

Folio

Amt $

Date

Details

Folio

Amt $

C/D

2000

00

2000

00

450

00

450

00

780

00

780

00

WAGES AND SALARIES A/C

Jan

Feb

15 Bank

Balance

B/D

2000

00 Jan

2000

00

2000

00

31

Balance

CARRIAGE OUTWARDS A/C

Jan

Feb

29

Balance

B/D

450

00 Jan

450

00

450

00

31 Balance

C/D

BAD DEPT A/C

Jan

Feb

30 J. James

Balance

B/D

780

00 Jan

780

00

780

00

31 Balance

C/D

DISCOUNT ALLOWED A/C

Jan

Feb

31 Total
Discount
Allowed
for the
month

Balance

B/D

125

00 Jan

125

00

125

00

31 Balance

C/D

125

125

00

00

General Ledger
Date

Details

Folio

Amt $

Date

Details

Folio

Amt $

Balance

C/D

1140

00

1140

00

350

00

350

00

SUNDRY EXPENSE A/C

Jan

Cash

290

00 Jan

Jan

28 Cash

850

00

1140

00

1140

00

Feb

Balance

B/D

31

CARRIAGE INWARDS A/C

Jan

Feb

Cash

Balance

B/D

350

00 Jan

350

00

350

00

31

Balance

C/D

SALES A/C
Jan

31 Balance

C/D

13,768

13,768

00 Jan

Cash

Jan

18 Cash

Jan

31 Total
Credit
Sales for
the month

00

1504

00

4664

00

7600

00

13,768 00
Feb

General Ledger

Balance

B/D

13,768 00

Date

Details

Folio

Amt $

Date

Details

Folio

Amt $

Balance

C/D

7000

00

7000

00

300

00

300

00

452

00

452

00

REFRIGERATOR A/C
Jan

Feb

31 Bank

Balance

B/D

7000

00 Jan

7000

00

7000

00

31

RETURN INWARDS A/C

Jan

Feb

31 Total
Return
Inwards
for the
month

Balance

B/D

300

00 Jan

300

00

300

00

31

Balance

C/D

RETURN OUTWARDS A/C

Jan

31 Balance

C/D

452

00

452

00

Jan

Feb

31 Total
Return
Outwards
for the
month

Balance

B/D

452

Folio

Amt $

General Ledger
Date

Details

Folio Amt $

Date

Details

PREMISES A/C
Jan

Balance

B/F

130,000 00 Jan

31

Balance

C/D

130,000 00
Feb

Balance

B/D

130,000 00
130,000 00

130,000 00
FIXTURES AND FITTINGS A/C

Jan

Feb

Balance

Balance

B/F

B/D

25,000

00 Jan

25,000

00

25,000

00

31

Balance

C/D

25,000

00

25,000

00

400

00

400

00

DRAWINGS A/C
Jan

Feb

24 Cash

Balance

B/D

400

00 Jan

400

00

400

00

31 Balance

C/D

PURCHASES A/C
Jan

Feb

31 Total
Credit
Purchases
for the
month

Balance

B/D

7054

00 Jan

7054

00

7054

00

31 Balance

C/D

7054

00

7054

00

General Ledger
Date

Details

Folio

Amt $

Date

STOCK A/C

Details

Folio

Amt $

Jan

Feb

Balance

Balance

B/F

B/D

12,000

00 Jan

12,000

00

12,000

00

31

Balance

C/D

12,000

00

12,000

00

180,610

00

180,610

00

180,610

00

CAPITAL A/C
Jan

31 Balance

B/F

180,610 00 Jan

26

Balance

B/F

180,610 00
Feb

Dr.

Balance

B/D

Sales Ledger Control A/C

Cr.

Jan 1
Jan 31

Balance B/F
Sales for the month

$5600
$7600

Jan 31
Jan 31
Jan 31
Jan 31
Jan 31

Bank
Discount Allowed
Return Inwards
Bad Dept
Balance C/D

$4195
$125
$300
$780
$7800
$13,200

$13,200
Feb 1

Balance B/D

$7800

Dr.

Purchases Ledger Control A/C

Cr.

Jan 31
Jan 31
Jan 31
Jan 31

Capital
Cash
Bank
Purchases

Return Outwards
Bank
Discount Received
Balance C/D

$452 Jan 1
$1425 Jan 31
$75
$6602
$8554
Feb 1

Balance B/F
Sales for the month

$1500
$7054

Balance B/D

$8554
$6602

Trial Balance as at 31 January 2014

Debit $
Credit $
180,610
1788
5320
7054

Sales
M. Lane
M. Lyn
C. Browne
R. Graham
R. Gordon
Wages & Salaries
Carriage Inwards
Bad Dept
Discount Allowed
Sundry Expense
Carriage Outwards
Refrigerator
Return Inwards
Return Outwards
Premises
Drawings
Fixtures & Fittings
Stock
Discount Received

13,768
2400
500
4900
1620
4982
2000
350
780
125
1140
450
7000
300
452
130,000
400
25,000
12,000
75
201,507

201,507

Adjusted (Updated Cash Book)

Jan1
Jan

Balance B/F
Credit Transfer

(Bank Column only)

$5320 Jan
$750 Jan
Jan
Jan
$6220

Standing Order
Stamp Duty
Bank Charges
Balance C/D

$500
$50
$340
$5330
$6220

Feb1

Balance B/D

$5330

Bank Reconciliation Statement as at 31 January 2014

Balance as per adjusted Cash Book
Add Unpresented Cheques
Less late Lodgements
Balance as per bank statement

$5330
$450
$5780
$1820
$3960

Trading Profit and Loss A/C for month ended 31 Jan 2014
Sales
13,768
Less Return Inwards
300
Net Sales
Less COGS:

13,468

Opening Stock
Add Purchases
Add Carriage Inwards
Gross Purchases
Less Return Outwards
Net Purchases

12,000
7054
350
7404
452
6952

Cost of goods available for sale

18,952

Less Closing Stock

10,400

COGS:
Gross Profit
Add Revenue:
Discount Received

8552
4916
75
4991

Less Expenses:
Carriage Outwards
Discount Allowed
Wages & Salaries (2000-250)
Sundry Expense (1140 +150)
Bad dept
Prov. For Bad dept

450
125
1750
1290
780
33

(5/100x

7800=390/12=32.50)

Depreciation
Fixtures & fittings

104

(5/100x25000=1250/12=104.17)
Refrigerator (10/100x7000=700/12=58.33)

58
4590
401

Net Profit

Balance Sheet as at 31 January 2014

$

Fixed assets
Premises

130,000

Fixtures & Fittings

Less Depreciation

25,000
104
24,896

Refrigerator
Less Depreciation

7000
58
6942
161,838

Current Assets
Stock
Trade Debtors
Less Prov. For Bad
Dept

10,400
7800
33
7767
5320
250
1788
25,525

Cash at Bank
Prepaid Expenses
Cash

Less Current liability

Trade Creditors
Accrued Expense

6600
150
6752
18,773
180,611

Financed by :
Capital
Add Net Profit
Less Drawings

180,610
401
181,011
400
180,61

Ratio Analysis and Interpretation of Results

Working Capital Ratio

Comparison made: Opening vs. Closing
Working Capital: Current Assets Current Liabilities
= $27,110 - $25,610
This reveals that at the beginning of the month the working capital was $27,110,
however at the end it was reduced by $1,500 to $25,610 a decrease of 5.5%
Solvency Ratio
(a)Current Ratio
Opening:

Current Assets
Current Liabilities
$ 27,110
= $ 1,500

=18:1

Current Assets

Closing: Current Liabilities

=

$ 25,525
$ 6,752

= 4:1

This means that at the beginning of the month there were enough current assets
to pay off current liabilities 18 times. However at the end of the month this was
reduced to 4 times so to every 1 liability it could be paid off only 4 times.

(b)Acid Test Ratio

Comparison made: Opening vs. Closing

Current AssetsStock
Current Liabilities

Opening:

Closing:

Current AssetsStock
Current Liabilities
$ 27,110$ 12,000
1,500

$ 25,525$ 10,400
$ 6,752

$ 15,110
$ 1,500

= 10:1

$ 15,125
$ 6,752

= 2:1

This means that at the beginning of the month there were enough liquid assets
to cover liabilities 10 times. However at the end of the month this was reduced
to 2 times resulting in assets being able to pay off liabilities only 2 times.

Gross Profit as a Percentage of Sales

Formula:

Gross Profit
100
Net Sales
4,916

= 13,468 100
= 35.5%
This means that for every $100 of sales, $35.50 gross profit was made before any
expenses were paid and contributed to net profit.

Net Profit as a Percentage of Sales

Formula:

Net Profit
100
Net Sales

401
100
13,468

=3%
This means that for every $100 of sales, Mias owner is gaining 3%

Gross Mark-Up
Formula:

Gross Profit
100
Cost of goods sold
$ 4,916
100
$ 8,552

= 57.5%
This shows how much gross profit is made for every $100 spent on buying goods
for resale. This means that the mark up was adequate to arrive at the selling price

Turn Over Ratio

Formula:

Cost of goods sold

Average Stock

Average Stock =

Opening Stock+Closing Stock

2
$ 8,552

= $ 11,200
= 0.76

$ 12,000+ $ 10,400
2

$ 22,400
2

= $11,200
This means that stock is being converted into sales less than 1 time during the
month of January.

Debtor Ratio

This measures the length of time taken for debtors to pay Mias.
=

Debtors
31
Sales for t h e year
$ 7,800

= $ 13,768 31
=18 days
This means that Mias Wholesale & Retail took 18 days to collect outstanding
funds from their credit customers.

Creditor Ratio
This measure the length of time taken by Mias to pay their suppliers.
=

Creditors
31
Purc h ases for t h e year
$ 6,602

= $ 7,054 31
= 29 days
This means that it took Mias Wholesale & Retail 29 days to pay their suppliers.

Expenses as a Percentage of Sales

Formula:

Expenses
100
Sa les
$ 4,590
100
$ 13,768

= 33.3 %
This shows what percentage of sales is an individual expense to Mias.

Return on Capital Employed Ratio

Formula:

Net Profit
100
Capital Employed

Capital =

Opening Capital+ClosingCapital
2
$ 401

= $ 180,611 100
=0.22%

($ 180,610+ $ 180,611)
2
$ 361,221
2

= $180,611
This means that Mias received a net profit of only 22 per $100.

Mias
Wholesale& Retail

Name: Tamia Mclean

Subject: POA
Centre Number: 100033
Territory: Jamaica
Date Submitted:
Pool: 5:3

TABLE OF CONTENT
Acknowledgement1
Aim of the Project..2
Statement of Affairs..3

Opening Entries.4
BOOKS OF ORIGINAL ENTRIES

Sales Journal..5
Purchases Journal...5
Return Inwards Journal..5
Return Outwards Journal...5

Cash Book..6
Sales Invoice...7
Receipt....8
LEDGERS
Sales Ledger...9
Purchases Ledger...10
General Ledger..11-15
CONTROL ACCOUNTS
Sales Ledger Control A/C..16
Purchases Ledger Control A/C..16
Trial Balance..17
Updated Cashbook18
Bank Reconciliation Statement..18
Trading Profit and Loss A/C..20
Balance Sheet..21
Ratio Analysis & Interpretation of Results... ..22-25

BOOKS OF
ORIGINAL
ENTRY

LEDGERS

CONTROL
ACCOUNTS

ACKNOWLEDGEMENT
I am using this opportunity to express my gratitude to everyone who supported me
throughout the course of this School Based Assessment. I am thankful for their
aspiring guidance, invaluable constructive criticism and friendly advice during this
project. I am sincerely grateful to my Principles of Accounts teacher Mrs. Williams
and to God for giving me the strength and understanding to complete this
assignment.

Aim of the Project

The aim of my project is for me to arrive at a comprehensive understanding of the
financial sector of the business world. To draw up the financial records for the year
2014 for Mias Wholesale and Retail and to comment on the entitys performance
using appropriate tools of Analysis.