Trading Account

Format of Trading Account

$ $

Sales Revenue (Sales Revenue)

Less: Sales Returns (Sales Return)

Less: Cost of Sales (Cost of Sales)

Gross Profit ¹

(Name of the business)Income statement for the year ended (Date) (Trading)

¹Sales Revenue-Sales Returns-Cost of Sales

Example: Below Shows a Trial Balance of a Business. Prepare a trading account for the business

Trial BalanceAs at 31 Oct 2012

Debit$

Credit$

Sales Revenue 446000Sales Returns 30Cost of Sales 2950Discount Received 8000Discount Allowed 4000Rental Income 1500Rental Expense 750Commission Income 900Salaries Expense 500Interest Income 120

Utilities Expense 70Service Income 500Repair Expense 350Cash in Hand 100000Cash at Bank 336278Inventory 6000Trade Receivables 12092Bank Loan 3000Trade Payables 2000Capital 1000

463020 463020

Insert sales revenue, sales return and cost of sales into the right column and calculate the gross profit

$ $

Sales Revenue 446000Less: Sales Returns 30Less: Cost of Sales 2950Gross Profit 443020

(Name of the business)Income statement for the year ended 31 October 2012 (Trading)