ACCN3 Incomplete Records

Question	Answer
Why do businesses have incomplete records?	1. Usually sole traders of partnerships because they don't have either the time, expertise or money.
Advantages of keeping incomplete records?	1. Simple and easy to do for businesses that don't have financial expertise. 2. Don't require an accountant 3. Don't need expensive accounting software
How can you use statement of affairs to calculate capital?	Assets - Liabilities = Capital
How can you calculate profit/loss using statement of affairs?	Closing capital - Opening capital = Profit/loss (after drawings) You can find net profit before drawings by simply adding drawings on.
Disadvantages of calculating profit/loss using statement of affairs	1. Not detailed enough for VAT or tax purposes 2. Not enough information for management purposes
Layout of cash account	Image: CASH.JPG (image/JPG)
Layout of a sales ledger control account	Image: slca.JPG (image/JPG)
Layout of purchase ledger control account	Image: plca.JPG (image/JPG)
How to calculate stock losses	Opening stock + Purchases =Cost of stock available Sales - Gross profit (using margin) = Cost of sales Cost of stock available - Cost of sales = Expected closing stock - Actual closing stock =Value of stock lost or stolen

Resource summary

	Created by umer.sabir almost 10 years ago