Jeff Ltd in Sheffield started its business in February 2020 and the following transactions were reported...

 

  

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Jeff Ltd in Sheffield started its business in February 2020 and the following transactions were reported during the month. (i) Jeff the owner deposit £90,000 in the business bank account on 1* February 2020 (ii)Bought a motor vehicle for £10,000 for cash on 2nd February 2020 (iii) Bought goods for £6,550 cash on 4th February 2020. (iv) Sold goods for £3,000 on credit to a customer in Chesterfield on 8th February 2020. a) Prepare journal entries to record the above transactions. (5 marks) Accounts Dr (£) Cr (£) Date (i) (ii) kiii) Kiv) b) Prepare Cash and Bank account' and Capital account' using your answers to question 2 above and balance off the account. (5 mark) Cash and Bank A/c Date Account Date Account Capital A/c Date Date Account £ Account c) Based on the information provided below to calculate the amount of cash received in the year 2024. Show your calculation process. (7.5 mark) The budgeted sales for the next four years are: 2021 £ 168,000 It is estimated that sales will be paid in cash for as follows: • 45% of the total will be paid in the year that the sales were made. • Of the balance 60% will be paid in the year after the sales were made. • The remaining 40% will be paid in the year after this. 2022 £ 246,000 2023 £ 266,000 2024 £ 388,000 d) Bookmark Limited makes high quality wooden bookmark. The selling price is £26 per unit and the total variable cost is £ 16 per unit. The company estimates that the fixed costs per month associated with this product are £8,000. You are required to: • Calculate the break-even point, in units per month • Calculate the break-even sales revenue per month • Calculate the estimated profit per month if Bookmark Limited makes and sells 3,500 units of product • If Bookmark Limited increases the selling prices by £1, what will be the impact on the break- even point, assuming non change in the number of units sold? (Marks 7.5) Jeff Ltd in Sheffield started its business in February 2020 and the following transactions were reported during the month. (i) Jeff the owner deposit £90,000 in the business bank account on 1* February 2020 (ii)Bought a motor vehicle for £10,000 for cash on 2nd February 2020 (iii) Bought goods for £6,550 cash on 4th February 2020. (iv) Sold goods for £3,000 on credit to a customer in Chesterfield on 8th February 2020. a) Prepare journal entries to record the above transactions. (5 marks) Accounts Dr (£) Cr (£) Date (i) (ii) kiii) Kiv) b) Prepare Cash and Bank account' and Capital account' using your answers to question 2 above and balance off the account. (5 mark) Cash and Bank A/c Date Account Date Account Capital A/c Date Date Account £ Account c) Based on the information provided below to calculate the amount of cash received in the year 2024. Show your calculation process. (7.5 mark) The budgeted sales for the next four years are: 2021 £ 168,000 It is estimated that sales will be paid in cash for as follows: • 45% of the total will be paid in the year that the sales were made. • Of the balance 60% will be paid in the year after the sales were made. • The remaining 40% will be paid in the year after this. 2022 £ 246,000 2023 £ 266,000 2024 £ 388,000 d) Bookmark Limited makes high quality wooden bookmark. The selling price is £26 per unit and the total variable cost is £ 16 per unit. The company estimates that the fixed costs per month associated with this product are £8,000. You are required to: • Calculate the break-even point, in units per month • Calculate the break-even sales revenue per month • Calculate the estimated profit per month if Bookmark Limited makes and sells 3,500 units of product • If Bookmark Limited increases the selling prices by £1, what will be the impact on the break- even point, assuming non change in the number of units sold? (Marks 7.5)

Answer rating: 100% (QA)

a Journal entry Date Accounts Debit Credit 01022020 Bank 90000 Capital account 90000 For cash deposi... View the full answer