Chrissys Stationary is located in Browns Town on the Browns Town High premises.

Chrissys Stationery will be engaged in a variety of school supplies- pen, pencil, rubber, sharpener, ruler, exercise books etc; which aims to make learning more effective and comprehensible. These products also aim to target students of all level and also teachers. This business will be operated within the timeframe of one month, September 2012 and will be operated as a Sole Proprietorship.

Books of Original Entry

Sales Journal Date September 6, 2012 September 12, 2012 September 12, 2012 September 24, 2012 Particulars C.Palmer H.Spencer C.Palmer H.Spencer Transferred to Sales Account Folio SL SL SL SL GL Amount $1800 $3580 $2780 $4440 $12600

Purchases Journal Date September 7, 2012 September 17, 2012 Particulars P.Jones D.Ellis Transferred to Purchases Account Folio PL PL Amount $3830 $7800 $11630

Returns Inwards Journal Date September 10, 2012 September 28, 2012 Particulars C.Palmer H.Spencer Transferred to Return Inwards Account Folio SL SL GL Amount $300 $300 $680

Returns Outwards Journal Date September 25, 2012 Particulars D.Ellis Transferred to Return Outwards Account Folio PL GL Amount $600 $600

Ledgers
Sales Ledger
C.Palmer $ 2012 1800 10-Sep 2780 11-Sep 30-Sep 4580 3280

2012 6-Sep 12-Sep

Sales Sales

SJ SJ

Return Inwards Bank Balance

RIJ CB c/d

$ 300 1000 3280 4580

1-Oct

Balance

b/d

2012 12-Sep 24-Sep

Sales Sales

SJ SJ

H.Spencer $ 2012 3580 20-Sep 4440 28-Sep 28-Sep 28-Sep 8020

Bank Cash Return Inwards Discount Allowed

CB CB RIJ CB

$ 2140 5400 380 100 8020

Purchases Ledger
P.Jones $ 2012 3780 7-Sep 50 3830

2012 13-Sep 13-Sep

Bank Discount Received

CB CB

Purchases

PJ

$ 3830 3830

D.Ellis 2012 19-Sep 25-Sep 27-Sep 30-Sep Bank Return Outwards Cash Balance CB ROJ CB c/d $ 2000 600 2730 2470 7800 2012 17-Sep Purchases PJ $ 7800

7800 1-Oct Balance b/d 2470

General Ledger
Capital 2012 30-Sep Balance c/d $ 40000 40000 1-Oct Balance b/d 2012 3-Sep 3-Sep Cash Bank CB CB $ 30000 10000 40000 40000

2012 3-Sep 11-Sep 30-Sep

Cash Cash Credit purchases for the month

CB CB PJ

Purchases $ 2012 7500 30-Sep 4930 11630 24060

Trading Account

NL

$ 24060

24060

Rent 2012 4-Sep 1-Oct Cash Balance CB b/d $ 1500 1500 2012 30-Sep Balance c/d $ 1500

Fixtures 2012 5-Sep 1-Oct Cash Balance CB b/d $ 1200 1200 2012 30-Sep Balance c/d $ 1200

2012 5-Sep 1-Oct

Cash Balance

CB b/d

Advertising $ 2012 450 30-Sep 450

Balance

c/d

$ 450

Sales 2012 30-Sep Trading Account NL $ 32450 2012 5-Sep 10-Sep 14-Sep 25-Sep 30-Sep 30-Sep Cash Cash Cash Cash Cash Credit sales for the month CB CB CB CB CB SJ $ 3950 4970 4210 3170 3550 12600 32450

32450

Wages 2012 14-Sep 30-Sep 1-Oct Bank Cash Balance CB CB b/d $ 1000 1000 2000 2000 2012 30-Sep Balance c/d $ 2000 2000

2012 17-Sep 1-Oct

Cash Balance

CB b/d

Transportation $ 2012 400 30-Sep 400

Balance

c/d

$ 400

2012 30-Sep

Profit and Loss a/c

Discount Allowed $ 2012 NL 100 28-Sep

Totals for the month

CB

$ 100

2012 13-Sep

Total for the month

Discount Received $ 2012 CB 50 30-Sep

Profit and Loss a/c

NL

$ 50

2012 30-Sep

Returns for the month

Returns Inwards $ 2012 RI 680 30-Sep

Trading Account

NL

$ 680

2012 30-Sep

Trading Account

Returns Outwards $ 2012 NL 600 30-Sep

Return for the month

RO

$ 600

Chrissy's Stationery Three Column Cash Book as at September 2012

Date 2012 3-Sep 5-Sep 10-Sep 11-Sep 12-Sep 14-Sep 19-Sep 20-Sep 25-Sep 28-Sep 30-Sep

Details Capital Sales Sales C.Palmer Cash Sales Bank H.Spencer Sales H.Spencer Sales

Folio

Discount Allowed $

Cash $ 30000 3950 4970

Bank $ 10000

1000 12000 4210 6000 2140 100 3170 5400 3550

Date 2012 3-Sep 4-Sep 5-Sep 5-Sep 12-Sep 9-Sep 13-Sep 14-Sep 17-Sep 19-Sep 19-Sep 27-Sep 30-Sep

Details Purchases Rent Fixtures Advertising Bank Purchases P.Jones Wages Transportation D.Ellis Cash D.Ellis Wages Balance

Folio

Discount Received $

Cash $ 7500 1500 1200 450 12000 4930

Bank $

50 400

3780 1000 2000 6000 2730 1000 29540

c/d 50

12360 25140

100 10ctober Balance b/d

61250 29540

25140 12360

61250

Trial Balance

Chrissy's Stationary Trial Balance as at September 30, 2012 DR C.Palmer 3280 D.Ellis Capital Purchases 24060 Rent Fixtures Advertising Sales Wages Transportation Discount Allowed Return Inwards Return Outwards Cash Bank Discount Received 1500 1200 450

CR 2470 40000

32450 2000 400 100 680 600 29540 12360 75570 50 75750

Income Statement
Chrissy's Stationery Trading and Profit and Loss Account for the month ended September 30,2012 $ Sales Less Returns Inwards Net Sales $ $ 32450 -680 31770

Less cost of goods sold: Purchases Add Transportation

24060 400 24460

Less Returns Outwards Net Purchases Cost of goods available Cost of goods sold Gross Profit Discount Received Adjusted Gross Profit Less Expenses Rent Advertising Wages Discount Allowed Total Expenses Net Profit

-600 23860 23860 23860 7910 50 7960

1500 450 2000 100 4050 3910

Balance Sheet
Chrissy's Stationery Balance Sheet as at September 30,2012 Fixed Assets Fixtures $ $ $ 1200

Current Assets Debtors Bank Cash Total Current Assets

3280 12360 29540 45180

Less Current Liability Creditor Working Capital

2470 42710 43910

Financed By: Capital Add Net Profit 40000 3910 43910

Accounting Ratios was used to interpret the various accounts which are drawn up. Current Ratio: Current Assets = 45180 = 18.29:1 Current Liability 2470 Current Ratio equals 18.29:1 times. This means that Chrissys Stationery could pay off its debts, creditors 18.29 times. Chrissys Stationery is doing well.

Gross Profit as Percentage of sales: Gross Profit * 100 = 7910 * 100 = 24.9% Sales 1 31770 1 For every $100 of sales $24.90 gross profit was made before any expenses were paid. Net Profit as Percentage of sales: Net Profit * 100 = 3910 * 100 = 12.3% Sales 1 31770 1 For every $100 of sales $12.30 net profit was made before any expenses were paid.

Rate of Return of Net Profit on Capital Employed: Opening Balance + Closing Balance = 40000 + 43910 = 41955 2 2 Net Profit____ * 100 = 3910 * 100 = 9.32% Capital Employed 1 41955 1 9.32% has been made for every $100 of capital employed during the one month period.

Figure 1. Line Graph depicting Purchases of Chrissys Stationery for the month of September.
30000 25000 20000 15000 11330 10000 4930 5000 0 Week 1 Week 2 Week 3 Week 4 7800 24060

Chrissys Stationery was compared with KDS Stationery Supplies for the month of September, both businesses are related in nature and sold similar products. Figure 2: Bar Graph illustrating Net Profit as a percentage of Sales.

KD'S Stationery Supplies

9.52

Chrissy's Stationery 0 2 4

12.3

10

12

14

Net Profit Percentage

Net Profit as a percentage of Sales: KDS Stationery Supplies = Net Profit\ Sales *100\1 = 3000/31500* 100/1 = 9.52% Chrissys Stationery made $12.30 in every $100 of sales in Net Profit while KDS Stationery Supplies made $9.52 on every $100 made in Net Profit. Gross profit as a percentage of Sales: KDS Stationary Supplies = Gross Profit\ Sales *100\1 = 6800/31500 *100/1 = 21.5% Chrissys Stationery made $29.50 in every $100 of sales made in Gross Profit while KDS Stationery Supplies made $21.50 on every $100 of sales made in Gross Profit.

Chrissys Stationery did greatly hence it is profitable. During the operation of the business within the one month period, the business acquired a Gross Profit of $7960, $3910 Net Profit and the total expenses was $4050. The business also had more than enough money to take care of its debts. Chrissys Stationery sold all stock.

The following recommendations are suggested: