At the beginning of April 2016, the ledger of Racquets R Us Tennis Shop showed Cash $3750;

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At the beginning of April 2016, the ledger of Racquets ‘R’ Us Tennis Shop showed Cash $3750; Inventory $2550; and Share Capital $6300. The following transactions were completed during April. 

The chart of accounts for the tennis shop includes Cash, Accounts Receivable, Inventory, Accounts Payable, Share Capital, Sales, Sales Returns and Allowances, and Cost of Sales and Freight Inwards. 


Required

(a) Journalise the April transactions.

(b) Using T accounts, enter the beginning balances in the ledger accounts and post the April transactions.

(c) Prepare a trial balance on 30 April 2016.

(d) Prepare a statement of profit or loss up to gross profit.

(e) What is the purpose of the chart of accounts? Why is it helpful in recording transactions?

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Financial Accounting Reporting Analysis And Decision Making

ISBN: 9780730313748

5th Edition

Authors: Shirley Carlon, Rosina Mladenovic Mcalpine, Chrisann Palm, Lorena Mitrione, Ngaire Kirk, Lily Wong

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