ACC100 - Keeping Up With The Joneses Education Ltd - Accounting Assignment

Internal Code: MAS5926

Accounting Assignment:

Gerald Jones has a passion for education and decided to open a tutoring business, “Keeping Up With The Joneses Education Ltd” on the 1 st July 2016. His primary focus is to sell tuition to students for the core subjects of English, Mathematics and Science; but also has a variety of educational resources (textbooks, a collection of past exams, etc) that he also sells to generate an income. At the end of his first year of operation, he was satisfied with respectable profits, the retained earnings made and with positive indications that his can satisfy all liabilities (both current and non-current). Gerald wants to continue this success into the new year, as he heard that 70% of businesses fail within the first 5 years of operation. As such, he wants to keep a close eye on how his business performs each month and report on how well the business is doing with its profitability, retained earnings and overall financial position. If there are any indications that the business is underperforming, he wants to make any necessary adjustments to avoid his business becoming another business that couldn’t make Task: As a friend of Gerald with a reasonable amount of accounting experience, you have been asked to perform the Accounting Cycle process for the month of July 2017 based on the June 2017 Post-closing Trial Balance and the transactions that took place in July. You have also been asked to make a report on the performance of the business based on its profitability, retained earnings and financial position. You have been provided with the statements made in June 2017 to assist you with this process. 1) a) Post-Closing Trial Balance of June 2017 Before you can make apply the accounting cycle for “Keeping Up With The Joneses Education Ltd” for July 2017, you will need the previous Post-Closing Trial Balance to be able to accurately update the values of the business’ accounts. 2) In addition to applying the Accounting Cycle, you are required to make a 1000-word report for Gerald, informing him of the business’ performance during the month and if there are any necessary adjustments that need to be made to help the business be successful. In your report, you will be required to address the following items: a) Introduction: What is your report about? What information will be included? b) Business’ profitability during July: Outline how the Income Statement shows the profitability of the business. Describe the revenue and expenses incurred during July. Determine whether the business was profitable or not. Explain how it performed compared to the previous month. Make suggestions as to how the business could improve its profitability in the future. c) Business’ Retained Earnings: Describe what retained earnings are. Compare the value of Retained Earnings for July 2017 compared to June 2017, based on the accounts included in the Statement of Changes in Equity. Explain what this means for the business. Make suggestions as to how it can improve its retained earnings in the future. d) Business’ Financial Position: Describe the purpose of the Balance Sheet. Determine which accounts have changed significantly in value and why. For each account included, explain what the change suggests about the business. Make suggestions as to how it can improve its financial position in the future. e) Include a conclusion: Provide a summary of the report, including a brief statement on how the business performed overall and whether it is required to make a lot of changes to be successful in the future.