Learning Objectives

You will develop accounting skills in restructuring accounting information from incomplete records and preparing final accounts for a sole trader. You will be able to restructure accounts to find missing information and incorporate accruals and prepayments, provisions for depreciation, irrecoverable debts and allowances for doubtful debts.

You will need to show understanding of the procedures involved in, and the reasons for, preparing final accounts for sole traders, including an awareness of the accounting systems that a business must put in place in order to produce meaningful information at the end of an accounting period. You should also develop an understanding of the environment and principles within which the business operates.

You will be introduced to the legal requirements underpinning the preparation of partnership accounts and be able to prepare final accounts for a partnership, showing the division of profits after adjusting for interest on capital, interest on drawings and any salaries due to each partner.

Learning Outcomes

Preparing final accounts for sole traders (skills)

• Prepare accounting records from incomplete information.
• Produce accurate final accounts.
• Have a basic understanding of legislation relating to the formation of a partnership.
• Prepare a profit and loss appropriation account.
• Prepare a balance sheet relating to a partnership.
• Understand generally accepted accounting principles and concepts.
• Understand the principles of double-entry bookkeeping.
• Understand the need for, and the process involved in, the preparation of final accounts.