West Demerara Secondary School

Year of Examination: 2017

Subject: Principles of Accounts

Proficiency: General

Candidate’s Number: 090056

Candidate’s Name: Nirmala Somnath

Name of Teacher: Sir Ramlall Motilall

SBA Score:
 West Demerara Secondary School

Year of Examination: 2017

Subject: Principles of Accounts

Proficiency: General

Candidate’s Number: 090056

Candidate’s Name: Nirmala Somnath

Name of Teacher: Sir Ramlall Motilall

SBA Score:
 TABLE OF CONTENTS
Contents Pages
Acknowledgement 1
Aims of Study 2
Description of the Business 3
Business Transactions 4-5
Day Books 6
Legers 7-9
Trial Balance 10
Three Column Cash Book 11
Calculation of Closing Stock 12
Specified Period Under Reviewed 13
Trading and Profit and Loss Account 14
Balance Sheet 15
Accounting Ratios 16
Performance of the Business 17
Comparison Made 18
Suggestion and Recommendation 19
Conclusion 20
Appendix 21-28
 ACKNOWLEDGEMENT

The researcher would love to express her gratitude to those who assist her to
completed this School Based Assessment (S.B.A.). She would first love to thank
God for guiding her to completed this School Based Assessment (S.B.A.). She
would also love to acknowledge her parents for financial support, reassurance and
guidance. She would also like to show appreciativeness to her teacher Sir Motilall
Ramlall for supervision and encouragement.

1
 AIMS OF STUDY

The aims of this study are:

 To interpret and analyse accounting information accurately.
 To gain a better understanding to prepare accounting records.
 To understand the role of an entrepreneur in a business with financial
matters.
 To highlight the strength and weakness of the business.

2
 DESCRIPTION OF THE BUSINESS

A’s Stationary operates as a wholesaler business i.e. located in 17 Good Hope,

Canal #1 on the West Bank of Demerara. The business sells stationary at low
prices to individuals or businesses that wishes to make a purchase. Being the only
business that is in this area helps the entrepreneur earn high profits and in return
the business owner provides reliable service for its customer.

3
 BUSINESS TRANSACTION

January 1st Started business with cash $300000

January 2nd Bank Cash $50000
January 2nd Purchased from A. Persaud on credit:
 70 boxes of markers @ $650 per box
 90 boxes of pens @750 per box
 60 boxes of pencils @520 per box
January 4th Cash sales:
 40 boxes of markers @ $910 per box
 50 boxes of pens @1000 per box
 15 boxes of pencils @750 per box
January 7th Paid insurance $2500
January 9th Paid wages $2000
January 10th Sold on credit to M. Hammichand:
 20 boxes of markers @ $910 per box
 25 boxes of pens @1000 per box
 10 boxes of pencils @750 per box
January 12th Cash purchases:
 30 boxes of markers @ $620 per box
 10 boxes of pencils @500 per box
 15 boxes of pens @700 per box
January 14th Cash drawings $1500
January 16th Purchased furniture $2000
January 18th Purchased from S. Dass on credit:
 25 boxes of markers @ $610 per box
 20 boxes of pens @450 per box
 10 boxes of pencils @650 per box
4
January 20th Cash sales:
 20 boxes of markers @ $910 per box
 25 boxes of pens @$1000 per box
 15 boxes of pencils @$750 per box
January 21st Return goods to A. Persaud:
 10 boxes of markers @$650 per box
January 22nd M. Hammichand return goods to us:
 2 boxes of pens @$1000 per box
January 24th Cash purchases:
 5 boxes of markers @ $620 per box
 10 boxes of pencils @500 per box
 20 boxes of pens @700 per box
January 25th Sold on credit to J. Harack:
 30 boxes of markers @ $910 per box
 15 boxes of pens @1000 per box
 20 boxes of pencils @750 per box
January 27th M. Hammichand paid us their account after a discount of $1000
January 28th Paid A. Persaud their account after a discount of $1200
January 29th J. Harack paid us $34380
January 31st Paid S. Dass $18450

5
 DAYBOOKS

SALES DAYBOOK
Date Particulars Folio Invoice # Amount
January 10th M. Hammichand S.L. $50700
January 25th J. Harack S.L. $57300
$108000

PURCHASES DAYBOOK
Date Particulars Folio Invoice # Amount
Jan 2nd A. Persaud P.L. $144200
Jan 18th S. Dass P.L. $30750
$174950

RETURN INWARDS DAYBOOK

Date Particulars Folio Invoice # Amount
January 22nd M. Hammichand S.L. $2000
$2000

RETURN OUTWARDS DAYBOOK

Date Particulars Folio Invoice # Amount

Jan 21st A. Persaud P.L. $6500

$6500

6
 LEDGERS

Capital a/c
Jan 1st Cash $300000

Cash a/c
Jan 1st Capital $300000 Jan 2nd Bank $50000
Jan 4th Sales $97650 Jan 7th Insurance $2500
Jan 20th Sales $54450 Jan 9th Wages $2000
Jan 27th M. Hammichand $47700 Jan 12th Purchases $34100
Jan 29th J. Harack $34380 Jan 14th Drawings $1500
Jan 16th Furniture $2000
Jan 24th Purchase $22100
Jan 28th A. Persaud $136500
Jan 31st S. Dass $18450

Bal c/d $265030

$534180 $534180
Bal b/d $265030

Bank a/c
Jan 2nd Cash $50000

Purchase a/c
Jan 2nd A. Persaud $144200
Jan 12th Cash $34100
Jan 18th S. Dass $30750
Jan 24th Cash $22100

Bal c/d $231150

$231150 $231150
Bal b/d $231150

7
 A. Persaud a/c
st
Jan 21 Return Outwards $6500 Jan 2nd Purchase $144200
Jan 28th Discount Received $1200
Jan 28th Cash $136500

$144200 $144200

Sales a/c
Jan 4th Cash $97650
Jan 10th M. Hammichand $50700
Jan 20th Cash $54450
Jan 25th J. Harack $57300

Bal c/d $144200

$144200 $144200
Bal b/d $144200

Insurance a/c
Jan 7th Cash $2500

Wages a/c
Jan 9th Cash $2000

Drawings a/c
Jan 14th Cash $1500

M. Hammichand a/c
Jan 10th Sales $50700 Jan 22nd Return Inwards $2000
Jan 27th Discount Allowed $1000
Jan 27th Cash $47700

$50700 $50700

8
 Furniture a/c
Jan 16th Cash $2000

S. Dass a/c
Jan 31st Cash $18450 Jan 15th Purchases $30750

Bal c/d $12300

$30750 $30750
Bal b/d $12300

Return Outwards a/c

Jan 21st A. Persaud $6500

Return Inwards a/c

Jan 22nd S. Dass $2000

J. Harack a/c
Jan 25th Sales $57300 Jan 29th Cash $34380

Bal c/d $22920

$57300 $57300
Bal b/d $22920

Discount Received a/c

Jan 28th A. Persaud $1200

Discount Allowed a/c

Jan 27th S. Dass $1000

9
 TRIAL BALANCE

Particulars Debit Credit

Capital $300000
Cash $265030
Bank $50000
A. Persaud $0
Sales $260100
Insurance $2500
Wages $2000
M. Hammichand $0
Drawings $1500
Furniture $2000
S. Dass $12300
Purchases $231150
Return Outwards $6500
Return Inwards $2000
J. Harack $22920
Discount Received $1200
Discount Allowed $1000
$280100 $280100

10
 THREE COLUMN CASH BOOK

Date Particulars Folio Dis Cash Bank Date Particulars Folio Dis Cash Bank
All Rec
Jan 1st Capital 300000 Jan 1st Bank C 50000
Jan 1st Cash 97650 50000 Jan 7th Insurance 2500
Jan 4th Sales 54450 Jan 9th Wages 2000
Jan 20th Sales 47700 Jan 12th Purchases 34100
Jan 27th M. Hammichand 1000 34380 Jan 14th Drawings 1500
Jan 29th J. Harack C Jan 16th Furniture 2000
Jan 24th Purchase 22100
Jan 28th A. Persaud 1200 136500
Jan 31st S. Dass 18450

Bal c/d 265030 50000

1000 534180 50000 1200 534180 50000
Bal b/d 265030 50000

11
 CALCULATION OF CLOSING STOCK

MARKERS PENS PENCILS

Purchases Sales Purchases Sales Purchases Sales
70 40 90 50 60 15
30 20 15 25 10 10
25 20 20 25 10 15
5 30 20 15 10 20
130 110 145 115 90 60
Difference between: Difference between: Difference between:
130-110 145-115 90-60
=20 =30 =30
Selling Price: $910 Selling Price: $1000 Selling Price: $750
20*$910= $18200 30*$1000= $30000 30*$750= $22500

Addition:
Markers-$18200
Pens-$30000
Pencils-$22500
Closing Stock=$70700

12
 SPECIFIED PERIOD UNDER REVIEWED

The specified period that was chosen to be reviewed was the month ‘January’ from
January 1st, 2016 to January 31st 2016.

13
TRADING AND PROFIT AND LOSS ACCOUNT
A’s Stationary
Trading and Profit and Loss Account for the month ended at
31st January, 2017
Sales $260100
Return Inwards $200 $258100

Cost of Sales
Purchases $231150
Return Outwards $6500
Stock Available $224650
Closing Stock $70700 $153950
Gross Profit $104150
Income:
Discount Received $1200
105350
Expenses:
Discount Allowed $1000
Insurance $2500
Wages $2000
A. Persaud $0
J. Harack $22920 $28420
Net Profit $76930

14
 BALANCE SHEET
A’s Stationary
Balance Sheet as at 31st January, 2017
Fixed Asset
Furniture $2000

Current Asset
Closing Stock $70700
Debtors $0
Bank $50000
Cash $265030
$385730

Current Liability
Creditors $12300 $373430
$375430

Finance by: $300000

Capital $76930 $376930
Net Profit $1500
Drawings $375430

15
 ACCOUNTING RATIO

CURRENT RATIO
Current Assets
Current Ratio =
Current Liability

385730
=
12300

= 31.36:1

WORKING CAPITAL
Working Capital = Current Assets- Current Liability
= 385730-12300
= 373430

GROSS PROFIT MARKUP

Gross Profit
Gross Profit Markup = * 100
Cost of Sales
104150
= *100
153950

= 67.652%

GROSS PROFIT MARGIN

Gross Profit
Gross Profit Margin = * 100
Sales
104150
= * 100
260100

= 40.042%

16
 PERFORMANCE OF THE BUSINESS

In the month of January, the business made a net profit of $76230 along with a gross
profit of $ 104150. The business also made a gross profit percentage of 40.042%.
the business earned $97650 from the first sale in the month of January and earned $
50700 from the second sale of the month. The business also earned $54450 on the
third sale of the month and on the fourth sale of the month the business earned
$57300.

17
 COMPARISON MADE

CASH STARTING AND CASH ENDING

A comparison between cashing starting and cash ending was done to show what
the business has earned. At the beginning of the month, cash used at the starting of
the month was three hundred dollars ($300000). Following the ending of the
month, cash used was two hundred and sixty-five thousand thirty dollars. There
was a decrease in the amount of money used to start the business compared to the
ending of the business.

OPENING CAPITAL AND CLOSING CAPITAL

A comparison between opening capital and closing capital was done to show what
the business has earned. At the beginning of the month, the opening capital was
three hundred dollars ($300000). Following the ending of the month, the closing
capital was three hundred and seventy-five thousand four hundred and thirty
dollars ($375430). There is an increase of seventy-five thousand four hundred and
thirty dollars ($75430) meaning a profit was made in the month of January.

18
 SUGGESTION AND RECOMMENDATION

As the business progress, the entrepreneur would like to improve the business
performances. Four ways are recommended to enhance that are the following.
Firstly, offer discounts after a certain amount of stationary were sold to other
business. Secondly, expand the options of stationary to choose from to attract
customers. Also, introducing various ways persons can contact the entrepreneur to
purchase goods, such as, email and telephone number. Lastly, entrepreneur can
advertise their product and contact information on business cards.

19
 CONCLUSION

The entrepreneur has benefited greatly from the establishment of the business. Not
only profits but also useful experience on ways to transact business. She gained
knowledge on ways to plan, manage, and analyze business strategies. These
experiences made the entrepreneur familiar with what they should do to make a
business more productive. The aims for establishing the business were achieved.

20
 APPENDIX

PURCHASE INVOICE

Date: 02nd January, 2016

Name: A. Persaud
Address: 16 Harlem, West Coast Demerara NO.: 190
To: A’s Stationary Telephone: 2635680

Date Particulars Unit Cost Amount

January 2nd 2016  70 boxes of markers $650 $45500
 90 boxes of pens $750 $67500
 60 boxes of pencils $520 $31200
Total $144200

Delivered by: A. Persaud

Received by: A’s Stationary

21
 SALES INVOICE

Date: 10th January, 2016

Name: A’s Stationary
Address: 29 Crane Village, West Coast Demerara NO.: 316
To: M. Hammichand Telephone: 2540852

Date Particulars Unit Cost Amount

January 10th 2016  20 boxes of markers $910 $18200
 25 boxes of pens $1000 $25000
 10 boxes of pencils $750 $7500
Total $50700

Delivered by: A’s Stationary

Received by: M. Hammichand

22
 CREDIT NOTE

Date: 22nd January, 2016

Name: M. Hammichand
Address: 19 La Grange, West Bank Demerara NO.: 107
To: A’s Stationary Telephone: 2763720

Date Particulars Unit Cost Amount

January 2nd 2016  2 boxes of pens $1000 $2000

Total $2000

Delivered by: M. Hammichand

Received by: A’s Stationary

23
 CASH BILL

Date: 04th January, 2016

Name: A’s Stationary
Address: 29 Crane Village, West Coast Demerara NO.: 241
To: Melessia Hammichand Telephone: 2635680

Date Particulars Unit Cost Amount

January 4th 2016  40 boxes of markers $910 $36400
 50 boxes of pens $1000 $50000
 15 boxes of pencils $750 $11250
Total $97650

Delivered by: A’s Stationary

Received by: Melessia Hammichand

24
 CASH RECEIPT

CASH NO. 996 Date 04/01/2016

RECEIPT

Received From Melessia Hammichand

the sum of Ninety- Seven Thousand, Six Hundred and Fifty dollars
being paid for 40 boxes of markers, 50 boxes of pens, and 15 boxes of pencils

$ 97650 Thank You Signature Nirmala Somnath

25
 BANK DEPOSIT SLIP

GUYANA BANK FOR TRADE AND INDUSTRY LTD. Branch Vreed-en-Hoop

Date 2016-01- 02nd

SAVINGS ACCOUNT NUMBER

CREDIT Nirmala Somnath

NOTES $ 5000 10 $ 50000
$ 1000
Authorized $ 500
$ 50
By $ 20

COINS $ 10
$ 5
CASHIER’S $ 1
TOTAL CASH $ 50000
STAMPS
Postal and Money Orders… …

Customers are advised that the Bank reserves the right CHEQUES (list on reverse if necessary)
at its discretion to postpone payment of withdrawals
against uncleared effects which may have been ………
credited to the account. ………

TOTAL CREDIT G$ $50000

SA002
Signature of
Person paying
to the Cashier N. Somnath

26
 SALES FOR THE MONTH OF JANUARY

Total
Cash Sales $97650 $152100
$54450

Credit Sales S. Dass $50700 $108000

M. Hammichand $57300

TOTAL SALES $260100

CASH SALES
Calculation for the Percentage of Cash Sales: 152100/260100*100= 58.48%
Calculation for the Degrees of Cash Sales: 152100/260100*360= 210.52o

CREDIT SALES
Calculation for the Percentage of Credit Sales: 108000/260100*100= 41.52%
Calculation for the Degrees of Credit Sales: 108000/260100*360= 149.48o

27
 THE FIGURE BELOW IS A PIE CHART
ILLUSTRATING THE COMPARSION OF CREDIT
SALES AND CASH SALES FOR THE MONTH OF
JANUARY.

42% Cash Sales

Credit Sales
58%

28