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2.1 Imagine you have been in business for a few months but you have not kept any proper records of your transactions. You have decided to end that business and start a new one by transferring every- thing to the new business. You now also want to start using double entry bookkeeping. The first step is to write down a list of everything belonging to the old business and everything the old business owes. Here is the list you prepared: Cash 400 Cash in US dollars worth Cash in the bank 2 280 900 350 3 Cash in the bank in Euros worth 5. Computer 710 Mobile phone Office furniture 6. 590 840 Printer 160 9. Delivery van 2,950 10 Goods for sale 12,300 Amcunt due from J. Gidman Amount due from K. Bailey 11 560 12 230 13 Loan from bank 6.000

FINANCIAL ACCOUNTING

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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2.1 Imagine you have been in business for a few months but you have not kept any proper records
of your transactions. You have decided to end that business and start a new one by transferring every-
thing to the new business. You now also want to start using double entry bookkeeping. The first step
is to write down a list of everything belonging to the old business and everything the old business owes.
Here is the list you prepared:
Cash
400
2
Cash in US dollars' worth
280
Cash in the bank
Cash in the bank in Euros worth
3.
900
4
350
Computer
710
6
Mobile phone
590
Office furniture
840
8
Printer
160
Delivery van
2,950
10
Goods for sale
12,300
11
Amcunt due from J. Gidman
560
Amcunt due from K. Bailey
Loan from bank
12
230
13
6,000
Required:
EMI
What is the debit and credit entry for each of these items? (Ignore the amounts.)
1 Cash
k Cash in US dollars' worth
3 Cash in the bank
Debit
account
Credit
account
Debit
account
Credit
account
Debit
account
Credit
4.
Cash in the bank in euros worth
Debit
account
Credit
account
aunoe
Computer
Debit
account
Credit
account
aunoɔpe
6 Mobile phone
Debit
account
Credit
account
aunoe
Office furniture
8
Printer
7
Debit
account
Credit
aunoɔpe
Debit
account
Credit
account
Delivery van
Debit
account
Credit
account
10 Goods for sale
Debit
account
Credit
account
11
Amount due from J. Gidman
Debit
Credit
account
account
12 Amount due from K. Bailey
Debit
account
Credit
account
13 Loan from bank
Debit
account
Credit
account
2.2 Make the entries in the T accounts for the items in question 2.1.
Cash account
Cash in US dollars account
Cash in the bank account
Cash in the bank in euros account
Computer account
Mobile phone account
Office furniture account
Printer account
Delivery van account
Goods for sale account
Amount due from J. Gidman
Amount due from K. Bailey
account
account
Loan from bank account
Capital account

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