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Unit 5 Business accounting P4 & P5 PASSED
- Module
- Unit 5 - Business Accounting
- Institution
- PEARSON (PEARSON)
Unit 5 Business accounting P4 & P5 were achieved.
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Reezi Unit 5 Group B P4 & P5Ricky’s balance sheet
Ricky also needs to produce his first balance sheet to reflect the value of the business as of 31 December.
He invoices customers upon completion of work and most customers pay by cash or cheque then and there.
However, one customer is a local business for whom Ricky looks after the lawns and flower beds at the front of
its offices. He charges them £500 per month and they pay one month later.
Ricky has also agreed a deal with a local nursery where he buys plants and shrubs. He has a business account
with them which allows him to buy on credit. He currently owes them £1,500.
Use all the information from Ricky’s cash-flow forecast (AS4), profit and loss account (AS5) and that above to
create a balance sheet for Ricky. Unless stated otherwise, assume the information presented in Ricky’s cash-
flow forecast is correct. Ricky’s actual closing balance at the end of December was £6,750.
Depreciation Value
£ £ £
Fixed assets
Vehicles (Truck) £20,000 £3,600 £16,400
Trailer
£5,000 £167 £4833
Current assets
Stock £350
Debtors £500
Cash £7,400
£8,250
Less current liabilities
Creditors £1,500
Overdraft £0 £0
Working capital £6,750
Long-term liabilities
Bank loans £17,500 - £5,500 £12,000
Net assets £15,983
Financed by
Capital
Retained profit £15,983
Capital employed £15,983
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