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Music Mart Solution - 1dec

This document shows accounting transactions over multiple periods for a business, including changes in assets, liabilities, equity, income and expenses. It provides year-end balances for assets, liabilities, equity, as well as income statements showing revenues, expenses and net income, and cash flow statements showing sources and uses of cash. The accounting equations are balanced at each period and the document demonstrates basic accounting concepts like accruals, adjustments and financial statement preparation.

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Sana Lee
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21 views5 pages

Music Mart Solution - 1dec

This document shows accounting transactions over multiple periods for a business, including changes in assets, liabilities, equity, income and expenses. It provides year-end balances for assets, liabilities, equity, as well as income statements showing revenues, expenses and net income, and cash flow statements showing sources and uses of cash. The accounting equations are balanced at each period and the document demonstrates basic accounting concepts like accruals, adjustments and financial statement preparation.

Uploaded by

Sana Lee
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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Assets Liability

Bank + Inventory Receivable Prepaid Land Claim Bank Loan Creditors Mortgage
Cash s Insurance Receivable Loan
T0 25,000
T1 12,500 12,500
T2 -5,000 5,000
T3 750 -500
T4 5,000 5,000
T5 2,300 -1,500
T6 -1,700 2,620
T7 -1,224 816
T8 -6,000 24,000 18,000
T9 3,000 -12,000 -9,000
T10 -1,000
T11 -750
T12
T13 -5,000 -5,000
T14
T15 -850 850
25,326 4,700 2,620 816 12,000 850 12,500 - 9,000
Equity
Capital Income -Expenses (Alpha) -Withdrawal (Beta)

Share Sales -COGS -Insur Exp -Dividends Check


Capital
25,000 -
-
-
750 -500 -
-
2,300 -1,500 -
2,620 -1,700 -
-408 -
-
-
-1,000 -
-750 -
-
-
-
-
25,000 5,670 -3,700 -408 -1,750 -
Income Statement Assets
Incomes Bank + Cash 25,326
Sales 5,670 Inventory 4,700
Expenses Debtors 2,620
COGS -3,700 Prepaid Insurance 816
Ins. Exp. -408 Land 12,000
Net Profit 1,562 Claim Receivable 850
Dividend -1,750
Retained earnings -188

Total Assets 46,312

Cash Flow Statement


CFO
Op. Bal 25,000
Inventory pur. -5,000

CFI

CFF
Loan 12,500

Net Change in Cash


Opening Cash and Equivalents
Closing Cash and Equivalents
Liab and Equity
Bank Loan 12,500
Creditors -
Mortgage Loan 9,000
Total Liab 21,500

Share Capital 25,000


Retained Earnings -188

Total Equity 24,812


Total Liab +Equity 46,312
1 Business Entity Concept
2 Prepaid and year-end adjustment
3 Conservatism
4 Secondary market
5 Dividend: Forms, Impact of Profit vs Retained Earnings
6 Expense versus loss

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