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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4972
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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Showing a loss (first Year) of £26,326 in profit and loss section, shareholders fund

Customer Question

Hi showing a loss (first Year) of £26,326
in profit and loss section, shareholders fund £1 with nothing in revaluation reserve, keep saying I am £1 out
Submitted: 1 year ago.
Category: Tax
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your question.Please send me your figures and I will review your accounts. Many thanks.
Customer: replied 1 year ago.
Turnover: AC12 £ 207,398
Cost of sales: AC14 £ 103.406
Gross profit or (loss): AC16 £ 103,992
Distribution costs: AC18 £ 46,346
Administrative expenses: AC20 £ 83,973
Other operating income: AC22 £ 00.00
Operating profit or (loss): AC26 £ -26,327
Interest receivable and similar income: AC28 £ 00.00
Interest payable and similar charges: AC30 £ 00.00
Profit or (loss) on ordinary activities
before taxation: AC32 £ -26,327
Tax on profit or loss on ordinary activities: AC34 £ 00.00
Profit or (loss) for the financial year: AC36 £ -26,327
The items below do not appear on the face of the profit and loss account.
Dividends for the period: AC38 £ 00.00
Net balance for the financial period
transferred to reserves:
AC40 £ -26,327Tangible assets: AC44 £12,855.
Total fixed assets: AC48 £ 12,855
Current assets
Stocks: AC50 £ 00.00
Debtors: AC52 £ 00.00
Cash at bank and in hand: AC54 £ 5830
Total current assets: AC56 £ 5830
Creditors: amounts falling due within
one year
AC58 £ 5110.00
Net current assets (liabilities): AC60 £ 5830.00
Total assets less current liabilities: AC62 £ 18685.00
Creditors: amounts falling due after
more than one year:
AC64 £ 00.00
Provision for liabilities: AC66 £00.00
Total net assets (liabilities): AC68 £ 13,575Hope that is enough info
regards
TonyBe back at my desk in 30 minutes ta..
Expert:  taxadvisor.uk replied 1 year ago.
Tony, thank you for your reply and for additional information. I wish you to look into the balance sheet more closely.This is your first year of operation and you have made a loss.. how was the operation funded.If your figure in Box AC40 is correct, your figure in box AC68 should also be a negative figure of £26,327. this would change by the amount you show as called up sahre capital in box AC70.Please revert to me once you have more information...You may wish to avail an offer for additional service to have a better understanding of preparing CT600 return. Many thanks
Customer: replied 1 year ago.
By the Directors injection of £5,110 and stock he had from self employment.
The figure in box AC68 is a negative figure of -£26,327. (my mistake) each time I change the figure £1 plus or minus this £1 in called up share capital in box AC70.it is always out by £1
Figure in C40 is correct
Customer: replied 1 year ago.
After paying £36 I don't want to spend £38 on the phone call; when I type the original question it came back saying 'you had the answer'
regards
Tony
Customer: replied 1 year ago.
To Confirm
AC70 shows £1
AC76 shows 00.00
AC74 -26,327 same as profit and loss
AC80 shows -26,326The 1£ difference will not let me proceed...?
Customer: replied 1 year ago.
Are you saying the figures below in current assets should show a minus in Total net assets (liabilities): AC68 -13,575how does that work aren't the assets a plus as far as the accounts are concerned: TonyCurrent assets
Stocks: AC50 £ 00.00
Debtors: AC52 £ 00.00
Cash at bank and in hand: AC54 £ 5830
Total current assets: AC56 £ 5830
Creditors: amounts falling due within
one year
AC58 £ 5110.00
Net current assets (liabilities): AC60 £ 5830.00
Total assets less current liabilities: AC62 £ 18685.00
Creditors: amounts falling due after
more than one year:
AC64 £ 00.00
Provision for liabilities: AC66 £00.00
Total net assets (liabilities): AC68 £ 13,575
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your reply.Basically, when you are completing entries in boxes on CT600 return for first year of trading your checks areAC40=AC74 (if AC40 is -26,327 then AC74 should also be -26,327Furthermore, Total net assets must equal Total shareholders' fundsin your scenario, AC80 is -26,326, therefore AC68 should read -26,326 but it is reading 13,575 ( a difference of some 39,901). Something is not quite correct in your postings.If AC68 is reading -26,327 as per your last posting, then it appears you have not accounted for £1 paid for called up share capital.Please increase you cash at bank and in hand AC54 by 1, this would reduce AC68 to -26,326 AND WILL equal the figure shown in AC80 -26,326.There will be no error. I hope this is helpful and answers your question.If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.
Customer: replied 1 year ago.
So Sorry but still not right...to get the figure AC68 £ 26,326.00I entered stock value of £12,750 which I entered the figure in AC50 £12,750Intangible assets: AC42 £00.00
Tangible assets: AC44 £ 00.00
Total fixed assets: AC48 £12,855
Current assets
Stocks: AC50 £ 12,750
Debtors: AC52 £ 0
Cash at bank and in hand: AC54 £ 5,831 (increased by £1)
Total current assets: AC56 £18,582
Creditors: amounts falling due within
one year
AC58 £ 5,110
Net current assets (liabilities): AC60 £ 13,471.00
Total assets less current liabilities: AC62 £26,326.00
Creditors: amounts falling due after
more than one year:
AC64 £ 00.00
Provision for liabilities: AC66 £ 00.00Total net assets (liabilities): AC68 £ 26,326.00 As you said it should beHowever..Called up share capital: * AC70 £ 1
Revaluation reserve: AC76 £ 00.00
Profit and Loss account: AC74 £ -26,326 (As you said it should)Total shareholders funds: AC80 £ -26,325.00Still showing highlighted in RED £ -26,325.00
Now showing £2 difference; still and will not let me advance
Customer: replied 1 year ago.
Please leave your reply... I have to go out for half an hour at least..
regards
Tony
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your reply.You had stated that AC40 is -26,327. Why are you showing in AC74 -26,326.I said AC80 should read -26,326 (Please increase you cash at bank and in hand AC54 by 1, this would reduce AC68 to -26,326 AND WILL equal the figure shown in AC80 -26,326.)You are showing a big loss in the first year .. this has to funded by either external sources and/or Director's own funds.You have to get to negative 26,326 in AC68 and not positive 26,326. .. only then will your balance sheet balance without errors. I hope this is helpful.
Customer: replied 1 year ago.
Good morning,Thanks for the latest information, I am away on a break until Monday when I will studiously work with the figures you have sent.
Will reply on MondayTony
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your reply.I wait to hear from you. Many thanks
Customer: replied 1 year ago.
Morning again,I am still trying to complete year end accounts, they are first year so nothing carried over.
Profit & Loss net balance AC40 -26,327.00
this figure is correct.
THEN...Does the company need to report any gains and losses, other than
profit or loss for the year?*
NO....
I increased AC54 (cash at bank by £1 at your suggestion) IE £5,831.00
Then...
Total net assets (liabilities): AC68 £26,326.00Called up share capital AC70 £1
Revaluation reserve AC76 £00.00
Profit & Loss account AC74 £-26,327.00
Total shareholder funds AC80 £-26,326.00 (highlighted in RED)
NOTE: if I change AC74 to any other figure (up or down by £1) it still shows RED
regards
Tony
Expert:  taxadvisor.uk replied 1 year ago.
Tony, thank you for your reply.Please send me image of the page..I am confused.. is AC68 26,326 orAC68 -26,326..It will only balance if AC68 reads -26,326 as AC68 should equal AC80 and this shows -26,326.please advise.. would you like to take the offer of a phone call to clarify matters?Let me know.
Customer: replied 1 year ago.
Hi see the copies of info as per problems with submissionregards
Tony
Customer: replied 1 year ago.
sent images as requested, regards
Tony
Expert:  taxadvisor.uk replied 1 year ago.
Hi Tony, thanks for your reply and for the images..There is a fundamental error somewhere.Its your first year of trading and you appear to have made a loss in the first year.Yet, you are showing net assets .. these two don't reconcile. If you made a loss then your balance sheet should show net liabilities and not net assets,How was the operation funded?Have you double accounted for certain expenditure?You say stock on hand at year end was 12,750. Have you reduced your cost of sales by this amount?Please review your figures and revert to me..Would you consider a phone call as additional service to clarify matters?many thanks
taxadvisor.uk and other Tax Specialists are ready to help you
Expert:  taxadvisor.uk replied 1 year ago.
I thank you for accepting my answer.Best wishes.

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