Reference no: EM131135688

Learning outcomes

- Describe and analyse the role of accounting information in a business context.

- Analyse a set of financial statements including balance sheet, profit and loss accounts and cash flow statements.

- Demonstrate the relationship between accounting data and financial planning and resource allocation decisions.

Assignment Task:

Question 1

Weather and Sons Trial Balance as at 30th June 2016

	£	£	adjustments - £		Final TB -£
	DR	CR	DR	CR	DR	CR
Retained Profit		88,000
Sales		636,000
Share Capital		100,000
Share Premium		200,000
Inventory	87,000
Purchases	230,000
Trade Payables		86,000
Trade Receivables	205,000
Bank	83,900
Motor expenses	12,987
Maintenance	12,000
Salaries & wages	106,000
Administration Expenses	33,220
Telephone	5,687
Heat & Light	14,300
Equipment at cost	318,000
Provision for depreciation equipment		45,000
Motor vehicles at cost	45,000
Provision for depn motor vehicles		6,000
Rent	68,000
Advertising	19,118
Bad Debts	3,788
Provision for Bad Debts		2,000
Long term loan		90,000
Interest	9,000
Equipment depreciation
Motor Vehicle depreciation
Prepayments
Accrual
Income tax expense
Provision for income tax
Loan interest accrued
	1,253,000	1,253,000

You are given the following additional information

a) Closing inventory is £50,000

b) Depreciation has not yet been provided

      Equipment 15% reducing balance

      Motor vehicles 25% straight line

c) Rent includes a prepayment of £8,000

d) There is an accrual for telephones of £4,300

e) Heat and lighting has been prepaid by £5,000

f) Taxation accrual of £18,300 is to be provided for the year

Required:

a. Adjust the trial balance to take account of the above adjustments.

b. Prepare the Statement of Comprehensive Income (Income Statement)

c. Prepare the statement of Financial Position (Balance Sheet)

Question 2

Choose two of the UK'S main airline companies from the list provided (British Airways, Ryan Air & Easy Jet) and download the companies' annual reports from their website.

Produce the 2013, 2014 and 2015 ratio table for the companies you have chosen from the list above (Profitability, Liquidity and Efficiency ratios as performed in class.) Choose two ratios from each category. Based on these ratios and any other additional information available from the annual reports, compile a report comparing the performance of the companies selected.