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FINANCIAL ACCOUNTING

Case 2-3 Lone Pine Caf


GROUP - 4
Anurag Chopra Arun Garg Aayush Tandon Debashree Mishra Himanshu Hirwani Hitesh Thakkar

LONE PINE CAFE


Partnership

formed by Mr. and Mrs. Henry Antoine and Mrs. Sandra Landers contributing $16000 each in cash to start a restaurant.
They

signed a 1 year lease to the Lone Pine Caf at a monthly rent of $1500.
Borrowed

$21000 from a local bank.

total of $56000 was paid to the previous operator.

LONE PINE CAFE


Paid $1428 for local operator licenses for one year in advance. Paid $1400 for new cash register. Remainder of total cash in hand was deposited in checking account. Now we need to prepare a balance sheet as of 2nd Nov,2005.

LONE PINE CAFE


Balance Sheet as of 2nd November 2005
Liabilities
Capital: Mr Antoine: 16000 Mrs Antoine: 16000 Mrs Landers: 16000 Loan Funds: Bank Loan

Amount

Assets

Amount

Current Assests: Cash at bank Inventory 48000 Prepaid Expenses Prepaid Rent 21000 Fixed Assests: Equipment Cash Register 69000

8672 2800 1428 1500

14400

53200 1400

54600 69000

LONE PINE CAFE

On march 31,2006 Mr. Antoine and Mrs. Landers disappeared and the cash register was missing. Clothing of Mr. Antoine was also present. Mrs. Antoine concluded that partnership was dissolved and decided to continue operating the caf and made an accounting till march 30. The cash register had $311 and checking account balance was $1030. Ski instructors had run up accounts worth $870 which were cleared subsequently.

LONE PINE CAFE

The caf owed suppliers $1583.

Depreciation on assets is $2445.


Food & beverages on hand were worth $2430. Mr. Antoines clothing amounted to $750. Repaid loan amount to bank $2100.

LONE PINE CAFE


1. 2.

3.
4. 5. 6. 7.

Cash received from customers through March 30th is $43480. Cash payments were as follows: Monthly payments to partners $23150 Wages $5480 Interest $540 Food & beverages suppliers $10016 Telephone and electricity $3270 Miscellaneous $255 Rent payments $7500 Based on these transactions an income statement and a balance sheet is to be prepared.

LONE PINE CAFE


Trading and Profit & Loss A/C for period ended 30th March
Particular
Opening Stock Purchases : Cash Credit Gross Profit c/d

Amount

Particular

Amount
44350 2430

2800 Sales Closing Stock 10016 1583 32381 46780

46780 32381 10854

Office Administration Expenses: Gross Profit b/d Salary 23150 Wages 5480 Net Loss c/d Telephone & Electricity 3270 Misc Expenses 255 Rent 7500 Interest 540 Depreciation 2445 Operating License 595 43235

43235

LONE PINE CAFE


Balance Sheet as of 30th March 2006
Liabilities
Capital:
Mr Antoine: 12382 Mrs Antoine: 12382 Mrs Landers: 12382

Amount

Assests
Current Assests:

Amount

Cash at Hand: 311 Cash at bank: 1030 37146 Debtors: 870 Inventory: 2430 Prepaid Expenses: 833 18900

5474

Loan Funds:
Bank Loan

Fixed Assests: Current Liabilities:


Creditors Equipment: 54600 1583 less: depriciation (2445) 52155

57629

57629

THANK YOU