Financial Accounting for Decision Makers

Jerry and Company
Statement of financial position as at 2 March
£
ASSETS
Cash at bank (20,000
-
5,000)
15,000
Motor van
5,000
Total assets
20,000
EQUITY AND LIABILITIES
Equity
6,000
Liabilities – borrowing
14,000
Total equity and liabilities
20,000
Jerry and Company
Statement of financial position as at 3 March
£
ASSETS
Cash at bank
15,000
Motor van
5,000
Inventories
3,000
Total assets
23,000
EQUITY AND LIABILITIES
Equity
6,000
Liabilities – borrowing
14,000
Liabilities – trade payable
3,000
Total equity and liabilities
23,000
M02 Atrill's Financial Accounting For Decis 51257.indd 43
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44
CHAPTER 2
MEASURING AND REPORTING FINANCIAL POSITION
Try drawing up a statement of financial position as at 4 March for Jerry and Company.
The statement of financial position as at 4 March, following the repayment of part of the 
borrowing, will be:
The repayment of £2,000 of the borrowing will result in a decrease in the balance at the 
bank of £2,000 and a decrease in the lender’s claim against the business by the same 
amount.
Activity 2.6
Jerry and Company
Statement of financial position as at 4 March
£
ASSETS
Cash at bank (15,000
-
2,000)
13,000
Motor van
5,000
Inventories
3,000
Total assets
21,000
EQUITY AND LIABILITIES
Equity
6,000
Liabilities – borrowing (14,000
-
2,000)
12,000
Liabilities – trade payable
3,000