Fnsacc301A Process Financial Transactions & Extract Interim Reports Essay

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Task 1: Transactions using the accounting equation
A note to students in regards to this task: – the transactions in this task do not incorporate GST. – Each transaction accumulates from the day before so that you are continuously balancing the accounting equation whilst applying the rules of debit & credit. – Ensure you show the totals at the end of each day to verify the equations is still in balance. – Example 1, on pages 49-51 is an excellent illustration of how to complete this task.

Assets [Dr]
Description

=
+/Amount Dr/Cr

Liabilities [Cr]

+
+/Amount Dr/Cr

Owners' Equity [Cr] + (Revenue [Cr] - Expenses [Dr])
+/Amount Dr/Cr

1 Sept: D Lee commenced business with Premises $50,000, Bank 20,000, Motor Vehicle $8,000 and Inventory $5,000

Bank Inventory Motor Vehicle Premmises

= = = =

20 000 5 000 8 000 50 000 83 000

dr dr dr dr =

Capital

=

83 000

cr

0

+

83 000

2 Sept: Inventory was purchased for cash by D Lee for $2 500

Bank
-

= Inventory
+

Motor Vehicle Premmises

= = =

20 000 2 500 17 500 5 000 2 500 7 500 8 000 50 000 83 000

dr cr dr dr dr dr dr dr =

Capital

=

83 000

cr

0

+

83 000

Assets [Dr]
Description

=
+/Amount Dr/Cr

Liabilities [Cr]

+
+/Amount Dr/Cr

Owners' Equity [Cr] + (Revenue [Cr] - Expenses [Dr])
+/Amount Dr/Cr

5 Sept: D Lee's bank gave a cash loan of $25 000

Bank
+

= Inventory

17 500 25 000 42 500 7 500

dr dr Loan from Bank dr
-

Capital 25 000 cr

=

83 000

cr

Motor Vehicle Premmises

= =

8 000 50 000 108 000 42 500 7 500 8 000 12 000 50 000 120 000

dr dr = dr dr dr dr dr = Accounts Payable Loan from Bank = =

25 000 12 000 25 000

+

83 000 Capital = 83 000 cr

10 Sept: Plant & Machinery for $12 000 was purchased on credit

Bank Inventory Motor Vehicle Plant & Machinery premises

= = = = =

cr cr

37 000

+

83 000

12 Sept: D.Lee purchased inventory on credit for $2 050...

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