Tabular Statement
The following balance sheet shows the financial position of a Sole Trader, Brigid Henderson, as at 01/10/2013 - Leaving Cert Accounting - Question 3 - 2014
Question 3
Tabular Statement
The following balance sheet shows the financial position of a Sole Trader, Brigid Henderson, as at 01/10/2013.
Balance Sheet as at 01/10/2013
Fi... show full transcript
Worked Solution & Example Answer:Tabular Statement
The following balance sheet shows the financial position of a Sole Trader, Brigid Henderson, as at 01/10/2013 - Leaving Cert Accounting - Question 3 - 2014
Step 1
Oct 4: Paid by cheque expenses that were due at the beginning of the month.
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Answer
This will reduce the bank balance and increase the expenses due by the same amount. New balances: Bank = €29,200, Expenses due = €600.
Step 2
Oct 7: Purchased goods on credit for €14,640.
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Answer
The purchase on credit increases stock and creditors. New balances: Stock = €63,640, Creditors = €32,640.
Step 3
Oct 12: Purchased a new delivery van for €18,000.
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This transaction reduces the bank balance due to the deposit and increases fixed assets. New balances: Bank = €23,200, Delivery Vans = €93,000.
Step 4
Oct 15: Received a credit from a debtor of €8,800.
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This transaction increases the bank balance and decreases debtors. New balances: Bank = €32,000, Debtors = €3,200.
Step 5
Oct 18: Paid by cheque €1,800 for repairs to private residence.
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This reduces the bank balance and increases expenses. New balances: Bank = €30,200, Expenses due = €2,400.
Step 6
Oct 20: Received a discount of €80 when paying a creditor’s account balance.
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This transaction reduces creditors and affects the bank balance. New balances: Bank = €30,280, Creditors = €32,560.
Step 7
Oct 21: Sold goods which originally cost €5,000 for €6,500.
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This increases the bank balance and affects the profit/loss account. New balances: Bank = €36,780, Profit/Loss = €26,700 (will increase).
Step 8
Final Totals of Assets and Liabilities on 31/10/2013.
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The total assets compute to €929,260, and liabilities total to €323,000, leaving a healthy financial position.
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