Scribd
Upload
4 views2 pages

Tutorial 1 Question

The document outlines the transactions of Flower Power Entity, a baby clothing company, for the financial period ending 31 December 2017. It includes details on purchases, payments, insurance, repairs, and court rulings, requiring the journalization of these transactions, posting to the general ledger, and preparation of financial statements. The tasks include creating a Statement of Profit and Loss and an assets section for the Statement of Financial Position.

Uploaded by

portiadacostam
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
4 views2 pages

Tutorial 1 Question

The document outlines the transactions of Flower Power Entity, a baby clothing company, for the financial period ending 31 December 2017. It includes details on purchases, payments, insurance, repairs, and court rulings, requiring the journalization of these transactions, posting to the general ledger, and preparation of financial statements. The tasks include creating a Statement of Profit and Loss and an assets section for the Statement of Financial Position.

Uploaded by

portiadacostam
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

2026 Accounting 100 Tutorial 1

Tutorial 1 (55 Marks)

Lethabo started her own baby clothing company Flower Power Entity. Flower Power Entity
has a 31 December year end. Flower Power Entity follows a perpetual inventory system.
The following transactions occurred during the reporting period of 31 December 2017:
1. The opening balance of Bank on 01 January was R250 000.
2. Flower Power entered into a contract on 25 March with ABC Entity to purchase a
sewing machine for R15 000 on credit. The sewing machine was delivered to Flower
Power on 01 April.
3. Flower Power settled the payable to ABC Entity of R15 000 for the sewing machine on
30 April.
4. On 30 April Flower Power entered into a contract with XYZ Motors to purchase a
delivery vehicle for R180 000. The vehicle was registered in the name of Flower Power
on 10 May and delivered on 15 June.
5. A payment of R180 000 was made on 30 June to XYZ Motors for the vehicle.
6. Flower Power entered into an insurance contract on 15 June with Shady Entity to make
monthly payments of R1 800 for insurance premiums on the delivery vehicle. The first
payment was on 01 July.
7. On 31 July the delivery vehicle was in an accident and required repairs, however
Shady Entity refused to pay for repairs. As a result Flower Power terminated the
contract with Shady Entity on the same date.
8. A payment of R2 500 was made on 01 August to M Entity for repairs to the delivery
vehicle.
9. Following the dispute with Shady Entity, on 15 August Flower Power sued Shady Entity
for the cost of the repairs amounting to R2 500. On the same day it was ruled by the
court that Shady Entity was to pay Flower Power an amount equal to R2 500.
10. An amount of R2 500 was received from Shady Entity on 31 August.
11. On 31 August Flower Power ordered inventory on credit from Cute Entity for R30 000.
The inventory was delivered on the 01 September.
12. Flower Power paid Cute Entity for the inventory on 30 September.
13. On 01 October Flower Power entered into a contract with W Entity to supply them with
baby clothing for R50 000 (cost of R25 000).This was delivered to W Entity on 01
December and a payment was received on the same day.
14. Lethabo withdrew R10 000 in cash from the business account on 31 December.

1
2026 Accounting 100 Tutorial 1

Required:

a) Journalise the transactions for the financial period ended 31 December 2017 in the
records of Flower Power Entity. (35)
Note:
The effect of the transaction on the accounting equation (A = L + E), must be shown.
The classification of the equity component that would be affected must be shown.

b) Post the transactions for the financial period ended 31 December 2017 in the General
Ledger - Bank account. (10)
c) Present the Statement of Profit and Loss of Flower Power Entity for the year 31
December 2017. (5)
d) Present the assets section in the Statement of Financial Position of as Flower Power
Entity at 31 December 2017. (5)

You might also like