1. Accounting Exercise –Accounting Reports and Ledger Recording (Additional)
Ms Swanson has recently launched a cosmetic store in the commercial block of Taylor’s
University’s Lakeside Campus. She needs your help with the recording of her business
transactions for 2014:
Jan 7: Started the business with a cash ($85000) and furniture ($15000).
Feb 22: Bought goods on credit, $17500. Also paid custom duty, $500.
Feb 16: Paid insurance expenses of $2400.
Mar 4: Sold goods on credit, $8700. Cost of goods sold is $5900.
Bought goods on cash, $6500.
April 15: Withdrew some furniture for personal use, $2500.
May 11: Borrowed $35000 from Teachers Credit Union (i.e. Bank loan).
May 29: Sold goods on cash, $6000. The COGS is $3800.
Jun 14: Withdraw $3000 of cash for personal use.
Jun 16: Returned faulty goods to creditor, $500.
Jul 3: Debtor returned faulty goods worth $700. The COGS reversed is $400.
Jul 26: Contributed some office equipment, $2500.
Aug 18: Received $7700 from debtor. Treated the rest of the debt ($300) as discount
expenses.
Sept 19: Paid $16500 to creditor. The creditor forgives the remaining debt ($500) as
discount revenue.
Oct 1: Paid $2000 of interest to Teacher’s Credit Union.
Nov 12: Receives $1000 from customer for providing consultation service.
Requirement: a) Record the transactions above in the ledger accounts.
b) Close the revenue and expenses account; and balance the other accounts.
c) Prepare a Balance Sheet and P&L statement.
