Accounting Concepts

1. List and explain the 9 steps in carrying out accounting process.

2. Using the steps outlined above, illustrate the preparation of the following over a 12-month period:

XYZ Ltd is formed January 2018, with capital of $1,000 deposited to the bank. Monthly the company

has rent of $50, people overheads $12, Utilities $5, Depreciation on equipment purchase for $200 in

the amount of 20% using the straight-line method, Other costs for fees and permits.

There are monthly sales of the widgets it produces through its virtual manufacturing operations of $500

and the direct materials and direct labour are $200 and $50 respectively.

a. Annual production Budget

b. Prime cost and monthly cost of goods sold

C. Cash book entry for first two months of start-up.

d. Journal entry for first 3 months

e. Statement of Income and expenditure (12 months)

f.Balance sheet (12 months)