Accounts School Based Assessment

Caribbean Secondary Education Certificate (CSEC)
School Based Assessment (SBA)
Principles of Accounts
Name of candidate: Maleah Hopkinson
Candidate #: 090046
Name of School: St. Rose’s High school
School Code: 090046
Name of Teacher: Sir Eugene Thompson
Territory: Guyana
Year: 2018
Acknowledgement
The researcher wishes to thank her Principles of Accounts teacher, Sir Eugene Thompson, for
guiding her towards the completion of the Accounts School Based Assessment. The researcher
also wishes to thank her parents for providing the condiments necessary to get this School Based
Assessment completed.
Content Page
Acknowledgement ………………………………………………………………………….
Introduction …………………………………………………………………………………
Aims …………………………………………………………………………………………
Description of the business ………………………………………………………………….
Transactions …………………………………………………………………………………
Ledgers ………………………………………………………………………………………
Journals ………………………………………………………………………………………
Final accounts ……………………………………………………………………………….
Source Documents……………………………………………………………………………..
Ratio and Analysis ……………………………………………………………………………
Performance of the business …………………………………………………………………
Comparison of Sales and Purchases ………………………………………………………..
Recommendation .……………………………………………………………………………
Conclusion ……………………………………………………………………………………
Mark scheme ………………………………………………………………………………….

Introduction
Genius Furnishing is a business that produces a variety of furniture to give any room a
professional but homey feel. Genius Furnishing was established by Maleah Hopkinson who had
a passion for the unique designs, styles and sizes of furniture. Genius Furnishing is business that
deals with the production aspect meaning they use any suitable raw materials to create a finished
product that fits the standards of the business. The development of the business was funded by
the use of questionnaires and different means of social media.

Aims
 To understand how the financial sector functions within a business
 To examine how accounting keeps a systematic record of financial transactions
 To gain a better understanding on preparing accounting records and documents

Description of Business
Genius Furnishing is a sole trader business located at the Gafoors Houston Complex. Genius
Furnishing was established and is managed by Maleah Hopkinson.
Genius Furnishing is a manufacturing and service industry which is involved in the production of
finished unique and extraordinary pieces of furniture. Genius Furnishing is a business that aims
to make 100% profit and to become a renowned furniture business. This would involve buying
only the best raw materials and employing workers who are hard-working and skilled employees.
The mission statement of Genius Furnishing is, “To promote a homey but professional feel in
any open space”.

Transactions
June 1st 2017: M.Hopkinson started a business with cash 1,502,000
June 2nd 2017: Purchased goods on credit from T.Bolgobin for 50,000
June 5th 2017: Purchased goods by cash 150,000 from C.Chain
June 9th 2017: Sold goods on credit: L.Laine 147,000, E.Anne 145,000, C.Caine 200,000
June 12th 2017: L.Laine paid us in cash 147,000
June 13th 2017: E.Anne paid us by cheque 145,000.
June 19th 2017: Bought machinery paying by cash 386,000
June 20th 2017: Cash sales 200,000
June 22nd 2017: Paid machinery expenses by cash 100,000
June 23rd 2017: Cash sales 207,000
June 25th 2017: Purchased goods by cash 100,000 from F.Faith
June 26th 2016: Goods returned to us by C.Caine 200,000
June 26th 2017: Drawings 500,000
June 27th 2017: Bought motor van by cash 252,000
June 28th 2017: Paid motor van expenses by cash 30,000
June 29th 2017: Returned goods to T.Bolgobin 30,000
June 30th 2017: Paid rent by cheque 50,000
June 30th 2017: Paid wages by cash 120,000
June 30th 2017: Paid machinery expenses by cash 29,000

Journals
Sales Day Book
Date Details Sub Total Total
June 10th L.Laine $147,000
E.Anne $145,000
C. Caine $200,000
Transferred to the General Ledger $492,000
Purchases Day Book
Date Details Folio Amt. ($)
June 4th T.Bolgobin $50,000
Transferred to the General Ledger $50,000
Returns Inward Day Book
June 26th C. Caine $200,000
Transferred to the General Journal $200,000
Returns Outward Day Book
June 29th T.Bolgobin $30,000
Transferred to the General Journal $30,000

Two Column Cash Book
Date Details Cash Bank Date Details Cash Bank
Jun 1st Capital 1,502,000 Jun 5th C.Chain 150,000
Jun 12th L.Laine 147,000 Jun 19th Machinery 386,000
Jun 13th E.Anne 145,000 Jun 22nd Machinery Expenses 100,000
Jun 20th Sales 200,000 Jun 25th F.Faith 100,000
Jun 23rd Sales 207,000 Jun 26th Drawings 500,000
Jun 27th Motor Van 252,000
Jun 28th Motor Van Expenses 30,000
Jun 30th Rent 50,000
Jun 30th Wages 120,000
Jun 30th Machinery Expenses 29,000
Balance c/d 389,000 95,000
2,056,000 145,000 2,056,000 145,000
Jul 1st Balance b/d 389,000 95,000

T-Accounts
Dr Capital Cr
Balance c/d $1,502,000 Cash $1,502,000
Balance b/d $1,502,000
Dr Cash Cr
Capital $1,502,000 Purchases $150,000
L.Laine $147,000 Machinery $386,000
Sales $200,000 Machinery Expense $100,000
Sales $207,000 Purchases $100,000
Drawings $500,000
Motor van $252,000
Motor van Expenses $30,000
Wages $120,000
Balance c/d $410,000
Machinery Expense $29,000
Balance c/d $389,000
$2,056,000 $2,056,000
Balance b/d $389,000

Dr Purchases Cr
T.Bolgobin $50,000 Balance c/d $300,000
Cash $150,000
Cash $100,000
$300,000 $300,000
Dr Sales Cr
Balance c/d $899,000 L.Laine $147,000
E.Anne $145,000
C.Caine $200,000
Cash $200,000
Sales $207,000
$899,000 $899,000

Dr T.Bolgobin (Creditor) Cr
Return Outwards $30,000 Purchases $50,000
Balance c/d $20,000
$50,000 $50,000
Balance b/d $20,000
Dr L.Laine Cr
Sales Cash
$147,000 $147,000
Dr E.Anne Cr
Sales Bank
$145,000 $145,000
Dr C.Caine Cr
Sales Return Inwards
$200,000 $200,000
Dr Bank Cr
E.Anne Rent $50,000
$145,000
Balance c/d $95,000
$145,000
$145,000
Balance b/d $95,000
Dr Machinery Cr
Cash $386,000 Balance c/d
$386,000
Dr Machinery Expenses Cr
$129,000
Cash $29,000
$129,000
Dr Return Inwards Cr
C.Caine $200,000 Balance c/d
$200,000
Dr Drawings Cr
$500,000
Dr Motor Van Cr
$252,000
Dr Motor Van Expenses Cr

Cash $30,000 Balance c/d $30,000
Balance b/d $30,000
Dr Return Outwards Cr
Balance c/d $30,000 T.Bolgobin $30,000
Balance b/d $30,000
Dr Rent Cr
Bank $50,000 Balance c/d $50,000
Balance b/d $50,000
Dr Wages Cr
$120,000

Trial Balance
Debit Credit
Capital 1,502,000
Cash 389,000
Purchases 300,000
Sales/Turnover 899,000
Return Outwards/Purchases 30,000
Returns
Return Inwards/Sales Returns 200,000
T.Bolgobin (Creditor) 20,000
Machinery 386,000
Machinery Expenses 129,000
Motor van 252,000
Motor van expenses 30,000
Rent 50,000
Wages 120,000
Bank 95,000
Drawings 500,000
2,451,000 2,451,000
Income Statement
Sales/Turnover 899,000
Less Returns Inwards (200,000)
Net Sales 699,000
Less Cost of Sales (270,000)
Gross Profit 429,000
Less Expenses
Machinery Expense 129,000
Wages 120,000
Rent 50,000
Motor Van Expenses 30,000
Total expenses (329,000)
Net Profit 100,000

Statement of Financial Position
Non-Current Assets Cost Depreciation Net Book Value
Motor Van 252,000 _ 252,000
Machinery 386,000 _ 386,000
638,000 _ 638,000
Current Assets
Cash 389,000
Bank 95,000
484,000
1,122,000
Capital
Opening Capital 1,502,000
Add Net Profit 100,000
Less Drawings (500,000)
1,102,000
Current Liabilities
T.Bolgobin (Creditor) 20,000
1,122,000
Ratio and Analysis
Profitability Ratios
 Gross Profit Margin
Gross Profit x 100
Sales
= 429,000 x 100
899,000
= 47.72%
 Return of Capital Employed (R.O.C.E)
Net Profit x 100
Capital
= 100,000 x 100
1,502,000
= 6.66 %
 Expenses to Sales
Expenses x 100
Sales
= 329,000 x 100
899,000
= 36.6
Liquidity Ratios
 Working Capital
Current Assets – Current Liabilities
= 484,000 – 20,000
= 464,000
 Current Ratio
Current Assets = x:1
Current Liabilities
= 484,000 = x:1
20,000
= 24.2:1 = x:1
Activity Ratio
 Asset Turnover
Total Assets
Sales
= 1,122,000
899,000
= 1.25
 Payable Days
Payables x 365
Credit Purchases
= 20,000 x 365
50,000
= 146 days
Performance of the Business
Genius Furnishing is a sole trader business which specializes in the production of finished unique
and extraordinary pieces of furniture.
When calculating the first category of ratios, profitability ratios, which includes the gross profit
margin, the return of capital employed and the expenses to sales ratio the following information
was gathered. It was found that when the gross profit margin was calculated, for every $100 in
sales the business is making 47.72% in gross profit. Since the gross profit margin is above 25% it
indicates that Genius Furnishing is financially efficient and stable and will therefore allow for the
business to cover its costs and it also gives it a competitive return for its investment in the
business. When calculating the return of capital employed it was found that for every $100 in
capital invested the owner is making 6.66% returns. Since the ROCE is less than the company’s
capital cost it indicates that the company is not employing its capital effectively and is not
generating shareholder value. When the expenses to sales ratio was calculated was shown that
for every $100 in sales the business incurs $36.6. With a ratio of 36.6% it shows that there is less
profitability.
When calculating the second category of ratios, liquidity ratios, which consists of the working
capital ratio and the current ratio. The working capital ratio is used in corporate finance to assess
a business' operational efficiency. When calculating the working capital ratio, it was found that it
is 464,000 which therefore means it has more than enough liquid funds to meet its short-term
obligations. The current ratio is intended to show the ability of a business to pay for its current
liabilities with its current assets, therefore when the ratio was calculated it was found to be
24.2:1. This therefore gives evidence that the company is well-positioned to cover its current or
short-term liabilities.
The calculations of the third category of ratios, activity ratio, includes the asset turnover ratio
and the payable days’ ratio. An asset turnover ratio measures the value of a business’ sales or
revenues generated relative to the values of its assets. When calculated, the asset turnover ratio
shows that assets are purchased 1 time per year. This therefore implies that the company is
generating less revenue per dollar of assets. The payable days’ ratio measures the number of days
that a company takes to pay its suppliers. Therefore, when this ratio was calculated it was shown
that the business takes 146 days to pay their payables/creditors.

Comparison of Sales and Purchases
When considering the ledgers and all final accounts there is a vast comparison between the sales
and purchases of Genius Furnishing. According to the gathered information sales were said to be
a sum of $899,000 and purchases were said to be a sum of $300,000. The difference between the
two is a difference of $599,000. Therefore, it can be said that Genius Furnishing made a profit of
$599,000 during the financial period ended June 30th 2017.
Pie chart showing the comparison of sales and purchases
Sales Purchases
Recommendation
When considering the information gathered from Genius Furnishing’s financial accounts some
actions need to be taken so as to improve the effectiveness and profitability of the business. The
researcher would like to recommend the following:
You need to show how you ended up the Cost of sales figure on the outside, this will include a
figure for closing stock which needs to be established, you can make up one let us say $45000,
that needs to be reflected in the Balance Sheet as well.
You need more graphs, that is why it is important to have expenses every week, you could have
shown weekly expenditure.
You could have shown weekly sales and purchases as well.
The names of persons go in the respective ledgers (T Accounts) Creditors in the payables ledger
while Debtors in the Receivables Ledger. All other accounts go in the General Ledger.

Accounts School Based Assessment

Hochgeladen von

Dokumentinformationen

Originaltitel

Copyright

Verfügbare Formate

Dieses Dokument teilen

Dokument teilen oder einbetten

Freigabeoptionen

Stufen Sie dieses Dokument als nützlich ein?

Sind diese Inhalte unangemessen?

Copyright:

Verfügbare Formate

Accounts School Based Assessment

Hochgeladen von

Copyright:

Verfügbare Formate

Caribbean Secondary Education Certificate (CSEC)

School Based Assessment (SBA)

Name of candidate: Maleah Hopkinson

Name of School: St. Rose’s High school

School Code: 090046

Name of Teacher: Sir Eugene Thompson

Description of the business ………………………………………………………………….

Final accounts ……………………………………………………………………………….

Ratio and Analysis ……………………………………………………………………………

Performance of the business …………………………………………………………………

Comparison of Sales and Purchases ………………………………………………………..

Mark scheme ………………………………………………………………………………….

the use of questionnaires and different means of social media.

 To understand how the financial sector functions within a business

 To examine how accounting keeps a systematic record of financial transactions

 To gain a better understanding on preparing accounting records and documents

Furnishing was established and is managed by Maleah Hopkinson.

any open space”.

June 1st 2017: M.Hopkinson started a business with cash 1,502,000

June 5th 2017: Purchased goods by cash 150,000 from C.Chain

June 12th 2017: L.Laine paid us in cash 147,000

June 13th 2017: E.Anne paid us by cheque 145,000.

June 19th 2017: Bought machinery paying by cash 386,000

June 20th 2017: Cash sales 200,000

June 22nd 2017: Paid machinery expenses by cash 100,000

June 23rd 2017: Cash sales 207,000

June 25th 2017: Purchased goods by cash 100,000 from F.Faith

June 26th 2016: Goods returned to us by C.Caine 200,000

June 26th 2017: Drawings 500,000

June 27th 2017: Bought motor van by cash 252,000

June 28th 2017: Paid motor van expenses by cash 30,000

June 29th 2017: Returned goods to T.Bolgobin 30,000

June 30th 2017: Paid rent by cheque 50,000

June 30th 2017: Paid wages by cash 120,000

June 30th 2017: Paid machinery expenses by cash 29,000

Date Details Sub Total Total

June 10th L.Laine $147,000

Transferred to the General Ledger $492,000

Purchases Day Book

Date Details Folio Amt. ($)

June 4th T.Bolgobin $50,000

Transferred to the General Ledger $50,000

Returns Inward Day Book

Date Details Folio Amt. ($)

June 26th C. Caine $200,000

Transferred to the General Journal $200,000

Returns Outward Day Book

Date Details Folio Amt. ($)

June 29th T.Bolgobin $30,000

Transferred to the General Journal $30,000

Date Details Cash Bank Date Details Cash Bank

Jun 1st Capital 1,502,000 Jun 5th C.Chain 150,000

Jun 12th L.Laine 147,000 Jun 19th Machinery 386,000

Jun 13th E.Anne 145,000 Jun 22nd Machinery Expenses 100,000

Jun 20th Sales 200,000 Jun 25th F.Faith 100,000

Jun 23rd Sales 207,000 Jun 26th Drawings 500,000

Jun 27th Motor Van 252,000

Jun 28th Motor Van Expenses 30,000

Jun 30th Rent 50,000

Jun 30th Wages 120,000

Jun 30th Machinery Expenses 29,000

Balance c/d 389,000 95,000

2,056,000 145,000 2,056,000 145,000