Creating a balance sheet from a specific trial balance

ROLCAM · Nov 28, 2009, 08:32 PM

You do the exercise !
Let us look at your effort.
There are many people here that can do this, but unfortunately we are NOT allowed to do it for you.
HAVE A GO !

ssmith89 · Nov 29, 2009, 03:22 AM

I have no clue! I'm completely lost! Wouldn't know where to start! Ok I don't want the answer, but at least some guidance on how I start it or go about doing it ?

ssmith89 · Nov 29, 2009, 03:25 AM

I know that you have several sections ie Assets, Fixed Assets, Liabilities, and Long term Liabilities but I don't understand the process in which to do this and why?

ROLCAM · Nov 29, 2009, 03:34 AM

WE have to persevere with you and do it together.
We shall take many attempts to get there, but you must do the work.
First you have to read the question half a dozen times to understand what is required.
First move required by you.
Instead of a long list of debits and credits ,
Are you capable of dividing this list into
Two lists:- showing list 1 the debits
And list 2 the credits.

Trial Balance Debit Credit
Cash 100.00
Bank 3,000.00
Motor Vehicles 19,925.00
Shop Equipment and Fittings 8,926.75
Rental Charges 10,179.75
Debtors and Creditors 8,095.25 16,325.00
Sales Returns and Purchase Returns 1,727.00 2,000.00
Purchases and Sales 40,777.50 60,850.00
Carriage Outwards 407.00
Carriage Inwards 417.50
Wages 6,000.00
Drawings 13,078.00
Opening stock 5,926.00
Rates 2,505.25
Light and heat 1,778.75
Insurances 2,200.00
Sundry Expenses 346.25
Loan (Bank) 12,000.00
Loan Interest 600.00
Postage 330.00
Discount Allowed and Received 298.00 432.50
Motor Expenses 3,677.00
Capital 10,687.50
Design Consultancy Fees 27,000
Design Expenses 5,000.00

List 1 the debits
List 2 the credits.
Do these two lists totals have an equal balance.?
Go ahead and do it and then come back to me.

ROLCAM · Nov 29, 2009, 03:41 AM

Rule number one !

All assets and all expenses are debits.
All( liabilities and equity) and all incomes are credits.

Formula a + e = (l + eq ) + i
______________________________________
Learn this by heart and never forget it !

ROLCAM · Nov 29, 2009, 03:45 AM

You must answer these questions :-

1) How old are you ?
2) Is this homework?
3) Are you studying Accountancy ?
4) What level have you reached?

ROLCAM · Nov 29, 2009, 04:35 AM

Ssmith89,

Please check all the figures again and again.
I have been doing some work on the answer to the problem and I am having some difficulty in getting the trial balance to agree.
Please notify as soon as possible.

One more question .
Do you use EXCEL ?

You must make sure that :
A) You separate the items when you have
Debits and credits in the same line.
B) Do not forget to include the CLOSING STOCK.
C) Do not forget to bring the depreciation
Figures in the trial balance and their corresponding provisions.

Rolcam.

morgaine300 · Nov 30, 2009, 01:43 AM

Rolcam, if you'd quote OP's original post, you'll see it's already in Dr/Cr columns and it does balance. The cash is negative.

Ssmith89, columns don't come off when you post so you can't use them. We can only see them when quoting the post and they still disappear when we actually post. Either write Dr/Cr on everything or use leaders dots or something.

Was the trial balance given to you exactly that way, with the cash negative like that? In real life, yeah, but for a problem, that's a little weird.

I don't see the point in listing debits first followed by credits, because that ordering doesn't have any meaning. Personally, I would list them in order of assets, liabilities, equity, revenue and expenses. That's the typical order and they'll also need organized by type in order to do your statements. Right now don't worry about sub-categories like current and long-term. Can you just get them into the five classifications?

You need to do two adjusting entries. An example of the reducing balance depreciation is here:
Depreciation Reducing Balance Method | Bizhelp24.com UK business and finance help and information

Can't help with the closing stock one cause it's done differently in the U.S. Surely they show you that in your textbook?

Why don't you start with all that and see what you can do.

ssmith89 · Dec 1, 2009, 07:53 AM

Hey

Thhanks morgraine I have put them in columns but they do not show up! The trail balance does balance!

I have worked out the gross profit which comes to 21644.5. I now need to work out the net profit, when doing this and listing the expenses do I need to add up all of the Debit? These are all expenses?

ROCLAM , in answer to your quesions:-

I am 20 and I'm currently studyin in England doing a foundation degree in landscape design, this work is part of a business module

Thanks

Creating a balance sheet from a specific trial balance

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