Russell was following a business studies course at his local university. As the summer was approaching,...

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Russell was following a business studies course at his local university. As the summer was approaching, he decided to try and earn some extra money to help finance a holiday in France. As he lived in a seaside town, he decided to try and sell ice cream on the beach. He had 100 to invest and was able to buy 10 boxes of ice cream from a local manufacturer at boxes and stored the unsold a cost of 10 per box. He expected to sell the ice creams in each box for a total of 15. On the first day, he sold boxes in his parent's freezer overnight. The next day he bought a further 10 boxes and managed to sell 11 boxes at 15 per box. On the third day he bought another 10 boxes, but only managed to sell 4 boxes as the weather had turned cold. As the long-term forecast was not good, Russell decided to abandon this venture and sold the remaining boxes at 8 per box. Required: (a) Prepare a profit and loss account and cash flow statement for each of the four days of trading. (b) Prepare a balance sheet at the end of each day's trading. (c) What do you deduce from an examination of the statements you have prepared? Russell was following a business studies course at his local university. As the summer was approaching, he decided to try and earn some extra money to help finance a holiday in France. As he lived in a seaside town, he decided to try and sell ice cream on the beach. He had 100 to invest and was able to buy 10 boxes of ice cream from a local manufacturer at boxes and stored the unsold a cost of 10 per box. He expected to sell the ice creams in each box for a total of 15. On the first day, he sold boxes in his parent's freezer overnight. The next day he bought a further 10 boxes and managed to sell 11 boxes at 15 per box. On the third day he bought another 10 boxes, but only managed to sell 4 boxes as the weather had turned cold. As the long-term forecast was not good, Russell decided to abandon this venture and sold the remaining boxes at 8 per box. Required: (a) Prepare a profit and loss account and cash flow statement for each of the four days of trading. (b) Prepare a balance sheet at the end of each day's trading. (c) What do you deduce from an examination of the statements you have prepared?

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