Can you please help me make a Chart of Accounts (COA) using the below Trial Balance. The
Question:
Can you please help me make a Chart of Accounts (COA) using the below Trial Balance. The Chart of Accounts must be formatted in a way that I can put it into Xero Accounting Software to produce financial reports. I am allowed to ignore income tax and the business is not registered for GST purposes.
Radiant Sage Consulting (RSC) is an investment consulting firm located in Melbourne. RSC specialises in providing expert consultation to both corporate entities and individuals seeking financial advice. For corporate clients, RSC's consultants offer tailored financial strategies that align with organisational objectives, on areas such as risk management, capital structure optimisation, and strategic financial planning. For individual clients, they provide personalised financial advice to maximise wealth accumulation, retirement planning and more. In addition, RSC also manage investment portfolios of clients if required, for both corporates and individuals. Recently, the company has introduced a new investment portfolio in cryptocurrency. The consultation fees and investment management fees are varied, determined based on the tailored services of clients.
You are recently appointed as the accountant of RSC, which has financial year that ends on 31 March. Currently all accounting records are completed in an excel file by the office staff. On 1 March 2024, RSC converted its current manual accounting system to use Xero, a cloud accounting system.
You have determined that RSC is not a reporting entity and is not required to prepare general purpose financial reports in accordance with the local statutory and professional requirements. RSC is not registered for GST for the purpose of this assessment. The following trial balance is extracted from the excel file.
| Radiant Sage Consulting | ||
| Trial balance as at 29 February 2024 | ||
| DR ($) | CR ($) | |
| Consultation fees - Corporate | 154,610.00 | |
| Consultation fees - Individual | 82,675.00 | |
| Investment management fees | 47,930.00 | |
| Office cleaning | 2,500.00 | |
| Insurance expense | 18,000.00 | |
| Salaries and wages | 105,000.00 | |
| Office & administration expense | 19,225.00 | |
| Annual leave expense | 9,755.00 | |
| Depreciation expense | 67,500.00 | |
| Interest expense | 6,250.00 | |
| Cleaning expenses | 4,650.00 | |
| Marketing and promotion | 14,750.00 | |
| Cash at bank | 9,150.00 | |
| Cash management account | 25,000.00 | |
| Accounts receivable | 10,800.00 | |
| Office buildings | 685,000.00 | |
| Accumulated depreciation - office buildings | 102,750.00 | |
| Computers and equipment | 330,000.00 | |
| Accumulated depreciation - computers and equipment | 66,000.00 | |
| Computer software | 60,000.00 | |
| Bank loans | 225,000.00 | |
| Accounts payable | 6,280.00 | |
| Provision for annual leave | 29,000.00 | |
| Retained earnings | 53,335.00 | |
| Share capital | 600,000.00 | |
| 1,367,580.00 | 1,367,580.00 |
The following information accompany the trial balance:
| Outstanding consultation fees (accounts receivable) as at 29 February 2024 | ||
| $ | Due date | |
| Mr & Mrs James (Individual) | 2,100.00 | 5-Mar-24 |
| Bright Innovations (Corporate) | 5,900.00 | 20-Mar-24 |
| Mrs Jacqui (Individual) | 2,800.00 | 28-Mar-24 |
| 10,800.00 |
| Outstanding bills (accounts payable) as at 29 February 2024 | ||
| $ | Due date | |
| Dazzle Cleaning Solutions | 825.00 | 7-Mar-24 |
| PulseTech Innovations | 5,455.00 | 26-Mar-24 |
| 6,280.00 |
The following transactions occurred during March 2024:
| Date | $ | |
| 1 | Received consultation fees from GreenLeaf Wellness & Co. (Corporate) on investment advice | 8,800.00 |
| Paid marketing fees to Sway Marketing Solutions | 495.00 | |
| 2 | Received investment management fees from Mr & Mrs Byron | 6,600.00 |
| Purchased computer accessories from OfficeWork for office staff | 450.00 | |
| 4 | Paid salaries for office staff | 1,200.00 |
| 5 | Investment management fees charged to a major client, Strategic Group, for investment portfolios managed, due in 7 days | 4,950.00 |
| Received outstanding consultation fees from Mr & Mrs James | ||
| 6 | Received investment management fees from Dynamics Inc. | 3,960.00 |
| 7 | Paid outstanding bill to settle account with Dazzle Cleaning Solutions | |
| 9 | Signed a contract with Ms Barton to manage her investment portfolios which are valued at $800,000, fees are 3% | |
| 10 | Investment management fees invoiced to Pristine Technologies, due in 14 days | 6,050.00 |
| 12 | Received all outstanding payment from Strategic Group | |
| 13 | Received investment management fees from Ms Tania | 902.00 |
| 15 | Consultation fees received from Ms Monic (Individual) | 5,500.00 |
| 18 | Received invoice from Sway Marketing Solutions for marketing fees, due in 21 days | 5,390.00 |
| Paid salaries for office staff | 1,600.00 | |
| 20 | Received full payment from Bright Innovations | |
| 22 | Signed a one-year contract with Silver Solutions to manage their investment portfolios | 11,000.00 |
| 24 | Acquired new computer software on credit from Benevo Technologies & Co., due in 30 days | 6,700.00 |
| Received all payments from Pristine Technologies | ||
| 25 | Settled accounts owed to PulseTech Innovations (purchase of computers in February) | |
| 26 | Sent invoice to Mr Freddy (Individual) for consultation fees on his investment portfolios, due in 14 days | 8,800.00 |
| 27 | Paid Dazzle Cleaning Solutions for cleaning services | 396.00 |
| 27 | Received invoice from Ultimate Builders for office repair work, due in 14 days | 2,640.00 |
| 28 | Paid interest on bank loans | 1,200.00 |
| Received partial payment from Mrs Jacqui | 1,000.00 | |
| 31 | Depreciation for office building for March 2024 | 1,800.00 |
| Depreciation for computers and equipment for March 2024 | 1,100.00 | |
| Impairment loss for computer software | 480.00 | |
| Insurance expense recorded was paid in February 2024 for a period of 6 months from 1 February 2024 |
Expert Answer:
