AC4052 Financial Accounting

This assignment requires each student to work on the published financial statements of ASOS plc for the last three years from 2018 to 2021.
You are required to write a report to evaluate the performance, liquidity and financial structure of the three years from 2018 to 2021.
You should use the accounting ratios shown below and any other information relevant to ASOS plc. Information can be accessed from the annual report and accounts and any other source of evidence that you believe helps to explain the company’s performance and position.
You should also highlight any limitations in the use of accounting ratios that you found in your analysis and evaluation of the company over the three-year period. This may include reference to the movements in the company’s share price. 

Question 1
Mr. and Mrs. Sharma run a small private company selling swimwear from China. Mr. Sharma has asked you to prepare set of financial statement for the year ended 31 December 2020 as soon as possible as the previous accountant left the company at very short notice.

Additional Information:
1. Stock at 31st December 2020 valued at cost amounted to £18000.
2. Depreciation is to be provided on fixtures and fittings at 25% on cost 10% on reducing balance method for motor vehicle.
3. Provision is to be made for electricity for £250.
4. Insurance paid in advance at 31st December 2020 amounted to £400.
Required
1. Prepare Income statement for the year ended 31st December 2020.

2. Prepare Balance Sheet as at 31st December 2020. 
3. Identify FIVE accounting concepts that have been applied in the preparation of financial Statements and explain their meaning. 

Question 2
The following statements of financial positions for the year ended 31st December 2020 and 2021 have been prepared for Harma Limited.
Statement of financial positions at: 31.12.21 31.12.20
1. Mrs Harma has asked you to prepare Harma Limited’s statement of cash flows for the year ended 31st December 2021.
2. Write a short memo to Mrs Harma explaining the findings of your statement of cash flow.