The trading inventory of Joan Street, retailer, has been reduced during the year ending 31 March 2020
Question:
The trading inventory of Joan Street, retailer, has been reduced during the year ending 31 March 2020 by £6,000 from its commencing figure of £21,000.
A number of financial ratios and related statistics have been compiled relating to the business of Joan Street for the year ending 31 March 2020. These are shown below alongside comparative figures for a number of retailers who are members of the trade association to which Joan Street belongs:
Joan Street has supplied all the capital for her business and has had no drawings from the business during the year ending 31 March 2020.
Required:
(a) Prepare the income statement for the year ending 31 march 2020 and balance sheet as at that date of Joan Street in as much detail as possible.
(b) Identify two aspects of Joan Street’s results for the year ending 31 March 2020 which compare favourably with the trade association’s figures and identify two aspects which compare unfavourably.
(c) Outline two drawbacks of the type of comparison used in this question.
Step by Step Answer:
Frank Woods Business Accounting An Introduction To Financial Accounting
ISBN: 9781292365435
15th Edition
Authors: Alan Sangster, Lewis Gordon, Frank Wood