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exercise_7 - MA826 FINANCE AND FINANCIAL REPORTING EXERCISE...

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MA826 FINANCE AND FINANCIAL REPORTING EXERCISE 7 1. Indicate which of the following transactions relate to Clive’s business as a newsagent and which are his personal transactions: (i) £50 win on premium bonds owned by Clive. (ii) £100 paid for the following advertisement on a hoarding at a local football ground: ‘Clive’s for all the up-to-date news’. (iii) Payment to the newspaper wholesaler, £1,260. (iv) Sale of unsold newspapers to a local fish-and-chip shop. (v) Purchase of a new car for family use, although it will be used each morning to collect papers from suppliers. 2. Roger starts up in business on 1 Sept with a capital of £1,200 which he pays into his business bank account on that day. The bank agrees to provide him with a business overdraft facility of £1,500 for the first three months. The following business transactions take place: 2 September A machine is bought, on three months credit, from Plant Suppliers Ltd for £750. £1000 is borrowed from the Endridge Local Authority, which is keen to encourage this type of enterprise.
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