The following information relates to Paris Cosmetics. Ltd. for the year 2017 (1/1/2017).
Cash……………………………………. €1,686
Short term investments………………... 1,277
Accounts Payable………………………. 7,840
Accounts Receivable…………………… 2,670
Inventory………………………………. 5,638
Intangible Assets………………………. 2,694
Current borrowings…………………….. 500
Non-current borrowings………………... 1,683
Property Plant and Equipment………… 23,316
Share Capital-Ordinary………………… 24,594
Retained Earnings……………………… ?
Instructions: Prepare the journal entries for each of the transactions. (4 points each)
Adjust the accounts using the beginning balances.
Accounts used: Cash, Short term Investments, Accounts Payable, Accounts Receivable, Inventory, Current Borrowings, Non-current borrowings, Property plant and Equipment, Share Capital- Ordinary, Retained Earnings, Interest expense, Advertising expense, Insurance expense, Sales Revenue, Wages expense, Utilities expense, Ingredient expense
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Paris Cosmetics
Income Statement
for the year 2017
Revenues
Cost of Goods sold (includes 6 types of expenses)
Gross Profit
Net income
Paris Cosmetics
Statement of Financial Position
At December 31, 2017
Assets (list both current and non-current)
Equity
Liabilities (list both current and non-current)
Expenses as % of sales
Current Ratio
Quick ratio
Net Working Capital
ROE
Debt- to- Equity
Ans: Paris Cosmetics Pvt. Ltd.
1) Journal Entries
Particulars | Debit (€) |
Credit (€) |
|
Current Borrowings A/c Dr. Interest A/c Dr. To Cash A/c ( Being payment of mortgage ) |
434 252 |
686 | |
Non-Current Borrowings A/c - Dr. To Current Borrowings A/c ( Being mortgage payment to made in next year is transferred to current borrowings) |
356 |
356 |
|
Advertisement Expense A/c Dr. To Cash A/c To Account Payable A/c ( Being Advertisement expenses incurred) |
872 |
500 372 |
|
Cash A/c Dr. Account Receivable A/c Dr. To Sales A/c ( Being sales revenue from fashion week recorded) |
410 10 |
420 | |
Insurance expense A/c Dr. To Cash A/c ( Being Insurance expense on the life of the employees paid) |
32 |
32 | |
Inventory A/c Dr. To Cash A/c ( Being Inventory purchased) |
10,800 |
10,800 | |
Cash A/c Dr. Account Receivable A/c To Sales A/c ( Being sales revenue form sales of cosmetics) |
10,236 5,250 |
15,486 |
|
Account payable A/c Dr. To Cash A/c ( Being payment to suppliers of Cosmetics) |
9238 |
9238 | |
Wages A/c Dr. To Cash A/c ( Being Wages paid to the employees) |
2,400 |
2,400 |
|
Utilities Expense A/c Dr. To Cash A/c (being utilities expense paid) |
500 |
500 | |
Dividend A/c Dr. To Cash A/c ( Being dividend declared and paid) |
900 |
900 | |
Inventory A/c Dr. To Ingredient expense A/c ( Being inventory used in manufacturing of goods) |
10,200 |
10,200 |
|
Cash A/c Dr. To Account Receivable A/c ( Being amount received form customers) |
6,900 |
6,900 | |
Retained Earnings A/c Dr. To Dividend A/c (Being Dividend Declare) |
900 |
900 |
2) Adjusting Ledger
Cash | |||
Particulars | Debit (€) | Particulars | Credit (€) |
Opening Balance | 1686 | Current Borrowings | 434 |
Sales | 410 | Interest | 252 |
Sales | 10,236 | Advertisement Expense | 500 |
Account Receivables | 6900 | Insurance Expense | 32 |
Account Payables | 9238 | ||
Wages | 2400 | ||
Utilities expense | 500 | ||
Dividend | 900 | ||
Closing Balance | 4976 | ||
19232 | 19232 | ||
Advertisement Expense |
|||
Particulars | Debit (€) | Particulars | Credit (€) |
Cash | 500 | Profit and Loss A/c | 872 |
Account Payables | 372 | ||
872 | 872 | ||
Retained Earnings |
|||
Particulars | Debit (€) | Particulars | Credit (€) |
Closing Balance | 3414 | Opening Balance | 2664 |
Income | 750 | ||
3414 | 3414 | ||
Wages | |||
Particulars | Debit (€) | Particulars | Credit (€) |
Cash | 2400 | Profit and Loss A/c | 2400 |
2400 | 2400 |
Account Payables |
|||
Particulars | Debit (€) | Particulars | Credit (€) |
Cash | 9238 | Opening Balance | 7840 |
Closing Balance | 9774 | Advertisement Expense | 372 |
Inventory | 10800 | ||
19012 | 19012 | ||
Non-Current Borrowings |
|||
Particulars | Debit (€) | Particulars | Credit (€) |
Current Borrowings | 356 | Opening Balance | 1683 |
Closing Balance | 1327 | ||
1683 | 1683 | ||
Interest | |||
Particulars | Debit (€) | Particulars | Credit (€) |
Cash | 252 | Profit and Loss A/c | 252 |
252 | 252 | ||
Ingredient Expense |
|||
Debit (€) | Particulars | Credit (€) | |
10,200 | Profit and Loss A/c | 10,200 | |
10,200 | 10,200 |
Account Receivables |
|||
Particulars | Debit (€) | Particulars | Credit (€) |
Opening Balance | 2670 | Cash | 6900 |
Sales | 10 | Closing Balance | 1030 |
Sales | 5250 | ||
7930 | 7930 | ||
Current Borrowings |
|||
Particulars | Debit (€) | Particulars | Credit (€) |
Cash | 434 | Opening Balance | 500 |
Closing Balance | 422 | Non-Current Borrowings | 356 |
856 | 856 | ||
Sales | |||
Particulars | Debit (€) | Particulars | Credit (€) |
Profit and Loss A/c | 15906 | Cash | 410 |
Account Receivables | 10 | ||
Cash | 10,236 | ||
Account Receivables | 5250 | ||
15906 | 15906 | ||
Dividend | |||
Particulars | Debit (€) | Particulars | Credit (€) |
Cash | 900 | Retained Earnings | 900 |
900 | 900 | ||
Inventory | |||
Particulars | Debit (€) | Particulars | Credit (€) |
Opening Balance | 5638 | Ingredient Expense | 10,200 |
Account Payables | 10800 | Closing Balance | 6,238 |
16438 | 16,438 | ||
Utilities expense | |||
Particulars | Debit (€) | Particulars | Credit (€) |
Cash | 500 | Profit and Loss A/c | 500 |
500 | 500 | ||
Insurance Expense |
|||
Particulars | Debit (€) | Particulars | Credit (€) |
Cash | 32 | Profit and Loss A/c | 32 |
32 | 32 |
Computation of Opening Retained earnings |
||
Particulars | Debit (€) | Credit (€) |
Cash | 1686 | |
Account Payables |
7840 | |
Account Receivables | 2670 | |
Non-Current Borrowings |
1683 | |
Current Borrowings |
500 | |
Short Term Investment | 1277 | |
Intangible Assets | 2694 | |
Inventory | 5638 | |
Property, Plant & Equipment | 23316 | |
Share capital Ordinary |
24594 | |
Retained Earning |
2664 | |
37281 | 37281 |
3)
Income Statement Profit & loss A/c |
||
Particulars | Amount (€) | |
Sales | 15906 | |
Less | ||
Cost of goods Sold |
||
Ingredient Expense | 10200 | |
Wages | 2400 | |
Interest | 252 | |
Insurance Expense | 32 | |
Utilities expense | 500 | |
Advertisement Expense | 872 | |
14256 | ||
Gross Profit | 1650 | |
Dividend Expense |
900 | |
Net Income | 750 |
4)
Fianancial Statement |
||
Particulars | Amount (€) | |
Equity and Liability |
||
Equity share capital |
24594 | |
Retained Earnings |
3414 | |
Non-Current Borrowings |
1327 | |
Current Liabilities |
||
Account Payables |
9774 | |
Current Borrowings |
422 | |
Total | 39531 | |
Assets | ||
Fixed Assets | ||
Intangible Assets | 2694 | |
Property, Plant & Equipment | 23316 | |
26010 | ||
Current Assets | ||
Short Term Investment | 1277 | |
Inventory | 6,238 | |
Cash | 4976 | |
Account Receivables | 1030 | |
13521 | ||
Total | 39531 |
The following information relates to Paris Cosmetics. Ltd. for the year 2017 (1/1/2017). Cash……………………………………. €1,686 Short...
The following information relates to Paris Cosmetics. Ltd. for the year 2017 (1/1/2017). Cash……………………………………. €1,686 Short term investments………………... 1,277 Accounts Payable………………………. 7,840 Accounts Receivable…………………… 2,670 Inventory………………………………. 5,638 Intangible Assets………………………. 2,694 Current borrowings…………………….. 500 Non-current borrowings………………... 1,683 Property Plant and Equipment………… 23,316 Share Capital-Ordinary………………… 24,594 Retained Earnings……………………… ? Instructions: Prepare the journal entries for each of the transactions. Paid mortgages of €686, €252 of which was interest and the remainder of which was repayment of principal.(Hint: think about what kind of...
The following information relates to Paris Cosmetics. Ltd. for the year 2017 (1/1/2017). Cash……………………………………. €1,686 Short term investments………………... 1,277 Accounts Payable………………………. 7,840 Accounts Receivable…………………… 2,670 Inventory………………………………. 5,638 Intangible Assets………………………. 2,694 Current borrowings…………………….. 500 Non-current borrowings………………... 1,683 Property Plant and Equipment………… 23,316 Share Capital-Ordinary………………… 24,594 Retained Earnings……………………… ? Instructions: Prepare the journal entries for each of the transactions. Paid mortgages of €686, €252 of which was interest and the remainder of which was repayment of principal.(Hint: think about what kind of...
The following information relates to Paris Cosmetics. Ltd. for the year 2017 (1/1/2017). Cash……………………………………. €1,686 Short term investments………………... 1,277 Accounts Payable………………………. 7,840 Accounts Receivable…………………… 2,670 Inventory………………………………. 5,638 Intangible Assets………………………. 2,694 Current borrowings…………………….. 500 Non-current borrowings………………... 1,683 Property Plant and Equipment………… 23,316 Share Capital-Ordinary………………… 24,594 Retained Earnings……………………… ? Instructions: Prepare the journal entries for each of the transactions. Paid mortgages of €686, €252 of which was interest and the remainder of which was repayment of principal.(Hint: think about what kind of...
The following information relates to Paris Cosmetics. Ltd. for the year 2017 (1/1/2017). Cash……………………………………. €1,686 Short term investments………………... 1,277 Accounts Payable………………………. 7,840 Accounts Receivable…………………… 2,670 Inventory………………………………. 5,638 Intangible Assets………………………. 2,694 Current borrowings…………………….. 500 Non-current borrowings………………... 1,683 Property Plant and Equipment………… 23,316 Share Capital-Ordinary………………… 24,594 Retained Earnings……………………… ? Instructions: Prepare the journal entries for each of the transactions. Paid mortgages of €686, €252 of which was interest and the remainder of which was repayment of principal.(Hint: think about what kind of...
The following information relates to Paris Cosmetics. Ltd. for the year 2017 (1/1/2017). Cash……………………………………. €1,686 Short term investments………………... 1,277 Accounts Payable………………………. 7,840 Accounts Receivable…………………… 2,670 Inventory………………………………. 5,638 Intangible Assets………………………. 2,694 Current borrowings…………………….. 500 Non-current borrowings………………... 1,683 Property Plant and Equipment………… 23,316 Share Capital-Ordinary………………… 24,594 Retained Earnings……………………… ? Instructions: Prepare the journal entries for each of the transactions. Paid mortgages of €686, €252 of which was interest and the remainder of which was repayment of principal.(Hint: think about what kind of...
The following information relates to Paris Cosmetics. Ltd. for the year 2017 (1/1/2017). Cash……………………………………. €1,686 Short term investments………………... 1,277 Accounts Payable………………………. 7,840 Accounts Receivable…………………… 2,670 Inventory………………………………. 5,638 Intangible Assets………………………. 2,694 Current borrowings…………………….. 500 Non-current borrowings………………... 1,683 Property Plant and Equipment………… 23,316 Share Capital-Ordinary………………… 24,594 Retained Earnings……………………… ? Instructions: Prepare the journal entries for each of the transactions. Paid mortgages of €686, €252 of which was interest and the remainder of which was repayment of principal.(Hint: think about what kind of...
The following information relates to Paris Cosmetics. Ltd. for the year 2017 (1/1/2017). Cash……………………………………. €1,686 Short term investments………………... 1,277 Accounts Payable………………………. 7,840 Accounts Receivable…………………… 2,670 Inventory………………………………. 5,638 Intangible Assets………………………. 2,694 Current borrowings…………………….. 500 Non-current borrowings………………... 1,683 Property Plant and Equipment………… 23,316 Share Capital-Ordinary………………… 24,594 Retained Earnings……………………… ? Instructions: Prepare the journal entries for each of the transactions. (4 points each) Paid mortgages of €686, €252 of which was interest and the remainder of which was repayment of principal.(Hint: think about...
Additional Information on Year 2017 Transactions a. The loss on the cash sale of equipment was $5,125 (details in b). b. Sold equipment costing $46.875, with accumulated depreciation of $30.125, for $11.625 cash. c. Purchased equipment costing S96.375 by paying S30.000 cash and signing a long-term note payable for the balance. d. Borrowed $4,000 cash by signing a short-term note payable .Paid $50.125 cash to reduce the long-term notes payable f. Issued 2,500 shares of common stock for $20 cash...
Forten Company, a merchandiser, recently completed its
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