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LESSON PLAN
Learning Objectives
At the end of the lesson, students should be able to:
i
...
Identify features of Trading ,profit and loss Account
iii
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Resources and Teaching aids
Essential Financial Accounting by R
...
A Kazeem
Intermediate Financial Accounting by J
...
K
...
The final account of a sole proprietorship can be grouped into the following:
a
...
Profit and loss account
c
...
The Trading Account
The trading account is that statement of account prepared to determine the gross profit of a business
...
Profit and Loss Accounts
This is a statement prepared to determine the net profit of a business
...
Balance Sheet :
The balance sheet is the summary of the financial balance of an organization
...
DR
#
Capital
Stock 1/12/96
Purchases and sales
Returns
Discounts
1
18,200
178,000
3,400
1,320
2
1
1
Debtors and creditors
Carriage outwards
Rents and rates
Wages and salaries
Machinery at cost
Provision for depreciation
Provision of bad debts
Bad debts
General office expenses
Cash at bank
32,000
4,250
7,480
17,740
150,000
2
3
7
1,060
3,890
47,720
465,060
4
Additional information
(a) Stock as at 31/12/96 was valued at #16,700
...
This has not been r
(c) Wages of #2,260 is owed while rent of #1400 had been prepaid
...
(e)Provision for depreciation of machinery at 20% reducing balance
...
Trading , profit and loss account for the year ended 31 st December , 1996 a
2
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Solution
NEWTON ENTERPRISE
A
TRADING, PROFIT AND LOSS ACCOUNT for the year ended 31st December , 1996
...
20000
5880
3890
200
1060
1320
68590
103,940
Gross profit b/d
Add discount received
NEWTON ENTERPRISE
BALANCE SHEET as at December 31st, 1996