Practical Accounting Assignment using XERO
During the month of April 2018, the Company has recorded a Total Income of $216, 765 and Cost of Sales amounted to $ 94,705. Hence, a Gross Profit of $122,060 was generated which represents a gross margin of 56%. The main expenses consist of Renovations of buildings which was carried out on 23rd of April 2018, a dividend of $20,000 which has been declared and monthly rental fees of $4116.67. Total Expenses for the month of April 2018 amounted to $41,131.54 and a Net Income of $80,928.46 was generated. The Net Margin amounted to 37% for the month of April 2018.
The Statement of Financial Position as at 30 April 2018, shows a positive net worth of the business of $431, 272.46. The business has a solid liquidity position with a closing bank balance of $265,354.36. The current ration stands at 6.7, which implies that the business can easily repay its short-term obligations. Total assets amounted to $545,466.82 while the total liabilities amounted to $114.194.36. The company is not heavily geared as the only long-term liability is the loan from NAB amounted to $40,000. Retained Profits has increased to $331,272.46 and the capital has remained at $100,000.