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hello there

could you please assess me with my accounting please

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thankyou very much

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QUESTION 1: Balance Day Adjustments (20 marks)
Louise Lace owns and operates a successful textile business specialising in cushions and quilt covers.
The business also sells a memory foam pillow that is made only for The Best Sleep Ever Company
that has recently featured in a number of health and wellbeing magazines. As a result of the recent
positive media coverage of the excellent products sold by The Best Sleep Ever Company, Louise is
too busy to undertake any record keeping for the company and has handed the record keeping over
to the accounting practice where you work as a graduate accountant.
The Best Sleep Ever Co
Trial Balance
As at 30 June 2019
$
Cash
8,160
Accounts Receivable
48,960
Inventory (1 July 2018)
58,480
Prepaid Rent
2,448
Delivery Van
21,760
Accumulated Dep'n Delivery Van
4,352
Vacuum Packing Equipment
5,440
Accumulated Dep'n Vacuum Packing Equipment
2,720
Accounts Payable
43,860
L Lace, Capital (1 July 2018)
78,880
L Lace, Drawings
17,000
Sales
282,608
Sales Returns & Allowances
3,060
Discount Allowed
544
Purchases
190,672
Interest Revenue
1,224
Electricity Expense
2,924
Water Expense
1,632
Sales Staff Wages
32,640
Local Government Rates Expense
1,088
Insurance Expense
4,760
Advertising Expense
5,100
Rent Expense
8,976
413.644
413.644
O
Louise has emailed you the following list of account information related to the year ended 30 June
2019:
(Continued next page)

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REQUIRED:
It is now the end of the financial year and Louise requires you to undertake the following:
Prepare the Balance Day Adjustment Journals for The Best Sleep Ever Company where required, in
the proforma provided on the next page. Include narration (explanation) for each journal entry.
(20 marks)
i)
The prepaid rent was paid on 1 April 2019 and was Shop/Office rent for the four months
ending 31 July 2019.
ii)
Both the Delivery Van and Vacuum Packing Equipment are expected to be used evenly over
their useful lives. The expected total useful lives and residual values of both assets is as
follows:
Useful life
Residual Value
Delivery Van
10 years
Vacuum Packing Equipment
3 years
$40
iii)
A physical stocktake of inventory at 30 June 2019 revealed $57,930 on hand.
iv )
$1,300 of the recorded sales represents receipts for goods which will not be delivered until 2
July 2019.
v)
It is estimated that 5% of the 30 June 2019 balance of Accounts Receivable is unlikely to be
received.
vi)
Upon receipt of the business's bank statement, Louise realised that the business bank
account had earned $51 interest on 30 June 2019 which had been directly paid into the bank
account by the bank on that day. The accounting records need to be updated for this
transaction.
vii)
Louise had relied on word of mouth to promote her business to date however on 1 February
1 2019, Louise decided to use an advertising company to advertise her business and
products and paid for the advertising campaign on that date. The advertising costs are $850
per month for a six month period.
vili)
Sales staff wages owing but not paid as at balance day equals $842.

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