Summary FIRST CLASS - AC100 Income Statement + Balance Sheet Preparation WITH FULL WORKINGS - Part 1

Preparation of Financial Statements (Income Statement (I/S)) and Statement of Financial
Position (SOFP))

Notes:
 Adjusting entries are NON-CASH, internal transactions  no cash is coming in or going
out (cash not touched: not credited/ not accounted for)
 DR and CR always by same amount
 WATCH OUT FOR DATES  THINGS NEED TO BE IN RELEVANT PERIOD  if not the case,
merely leave values as they are (eig immer eine date trap)
 also look at MONTHS

SOFP
 Minus in brackets

Income Statement

NOTE DOWN END OF YEAR ON EXTRA SHEET AND ALWAYS KEEP IN MIND

(Company name)

Income Statement Year Ended (date)

£000 £000 Workings
Sales
Cost of sales

Gross Profit xxx

Administrative expenses
Rent
Salaries and wages
Heat and light
Distribution costs
Directors fees
Insurance
Audit fees
Bad debt written off
Increase in provision for doubtful
debt/ Provision release for
doubtful debt
Depreciation expense (separately
for several factors)

Operating profit xxx

Interest expense/receivable
Other income (dividend received)