EBS - BSc 1st Semester Exercise 3 English Class incl. Solution.pdf

Students of the 1
st
semester
Class: Bookkeeping & Accounting
Exercise 3: Obligation to keep accounts
a) Is every merchant obliged to keep accounts? If so or if not, why?
b) X runs a small flower store at the train station in Wiesbaden, without any employees. The annual turnover
of X in 01 is only 50,000 € and the net income of the year (profit) is 12,000 €. Is X obliged to keep
accounts?

General information
Four basic types of income-neutral business
transactions
If a business transaction changes the structure of
the asset side without changing the capital and
without changing the balance sheet total, this is
referred to as restructuring of assets.
An example of a business transaction that leads to
a restructuring of assets is, for example, the
settlement of a receivable by the customer in cash.
The trade accounts receivable account decreases
and the cash account increases. Thus, only
accounts on the asset side of the balance sheet
change. The capital and the balance sheet total do
not change.
Literally reversed, a change in the structure on the
liabilities side due to a business transaction without
a change in capital and the balance sheet total
constitutes a restructuring of liabilities.
An example of a business transaction would be the
settlement of a liability by taking out a new loan.