Question

Transaction analysis and Financial Statements
After several months of planning, Ms. Gyamfua Boakye started Keep Safe Shop which is into
buying and selling the supplies of Covid-19. The following transactions occurred during the first
month.
Jun. 1 Started business with a cheque of GH₵17,000, cash of GH₵3,000.
2. Bought a shop for GH₵6,000 cheque.
3 Purchased fixtures and fittings for GH₵1,300 with cheque.
4 Bought nose masks for GH₵2,000 with cheque and carriage for GH₵50 cash.
5 Advertising expense GH₵100 paid by cash.
9 Bought face shields for GH₵1,500 and carriage GH₵30 with cash.
12 Bought nose masks GH₵3,200 and face shields GH₵6,000 from Combat Technology Ltd
on credit.
15 Sold nose mask for GH₵4,600 cash and face shield for 6,500 cheque.
16 Deposited GH₵1,000 cash into the bank.
20 Paid Combat Technology Ltd GH₵7,000 cheque and received a discount of GH₵700.
23 Ms. Boakye took GH₵250 cash for personal use.
25 Paid salaries for GH₵500 by cheque.
26 Paid electricity expense GH₵80 by cash.
27 Sold nose masks and face shield on credit to Nana Yaa at GH₵5,600.
28 Nana Yaa returned some of the face shield due to damages GH₵600.
30 Received a cheque of GH₵4,600 from Nana Yaa and her allowance of GH₵460.
Required:
a. Journalize the above transactions
b. Post the journal entries to their respective accounts and balance off the accounts
c. Extract the trial balance as at June 30, 2020
d. Prepare the Income Statement for the period ended June 30, 2020
e. Prepare the Statement of Financial Position as at June 30, 2020

Answer 1

a)

Journal Entry
Date	Particulars	Amount Dr	Amount Cr
Jun-01	Cash A/c	3000
	Bank A/c	17000
	To Capital A/c		20000
Jun-02	Shop A/c	6000
	To Bank A/c		6000
Jun-03	Fixture and fittings A/c	1300
	To Bank A/c		1300
Jun-04	Purchase A/c	2000
	Carriage Inwards	50
	To cash		2050
Jun-05	Advertising Exp. A/c	100
	To Cash		100
Jun-09	Purchase A/c	1500
	Carriage Inwards	30
	To Cash		1530
Jun-12	Purchase A/c	9200
	To Combat Technologies		9200
Jun-15	Cash A/c	4600
	Bank A/c	6500
	To Sales		11100
Jun-16	Bank A/c	1000
	To Cash		1000
Jun-20	Combat Technology A/c	7700
	To Bank		7000
	To Discount received		700
Jun-23	Cash A/c	250
	To Drawings		250
Jun-25	Salaries A/c	500
	To Bank A/c		500
Jun-26	Electricity Exp. A/c	80
	To cash		80
Jun-27	Nana Yaa A/c	5600
	To Sales		5600
Jun-28	Sales A/c	600
	To Nana Yaa A/c		600
Jun-30	Bank A/c	4600
	Discount A/c	460
	To Nana Yaa A/c		5060

b) :Ledger Account

		Cash A/c
Date	Particulars	Amount	Date	Particulars	Amount
Jun-01	To Capital A/c	3000	Jun-04	Purchase A/c	2000
Jun-15	To Sales	4600		Carriage Inwards	50
Jun-23	To Drawings	250	Jun-05	Advertising Exp. A/c	100
			Jun-09	Purchase A/c	1500
			Jun-09	Carriage Inwards	30
			Jun-16	Bank A/c	1000
			Jun-26	Electricity Exp. A/c	80
			Jun-30	By Bal. c/d	3090
	Total	7850		Total	7850
		Bank A/c
Date	Particulars	Amount	Date	Particulars	Amount
Jun-01	To Capital A/c	17000	Jun-02	Shop A/c	6000
Jun-15	To Sales	6500	Jun-03	Fixture and fittings A/c	1300
Jun-16	To Cash	1000	Jun-20	Combat Technology A/c	7000
Jun-30	To Nana Yaa A/c	4600	Jun-25	Salaries A/c	500
			Jun-30	By Bal. c/d	14300
	Total	29100		Total	29100
		Purchase A/c
Date	Particulars	Amount	Date	Particulars	Amount
Jun-04	To cash	2000
	To Cash	1500
	To Combat Technologies	9200
			Jun-30	By Bal. c/d	12700
	Total	12700		Total	12700
		Sales A/c
Date	Particulars	Amount	Date	Particulars	Amount
Jun-28	To Nana Yaa A/c	600	Jun-15	Cash A/c	4600
				Bank A/c	6500
			Jun-27	Nana Yaa A/c	5600
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