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Dubai Pet world Grooming and kennel centre was founded in 2007,
is a profit making
organization and intends to capture a big share of the growing pet market. After two years of operations the company went public. The company is only luxury services provider of boarding
& grooming to the pets in Dubai. Although the product offered by the company are unique but
the customer wanted all the pet facilities under one roof, which served as a major disadvantage for the concern. Dubai Pet world Grooming and kennel centre has operated at a very low level of net profit during the initial year of its starting the business. Bt this year the company is determined to enhance the profitability level and establish it self a prominent player in the field of luxury services and providing the full range of the products starting from Luxury grooming, boarding, and training and cemetery services. Shabir the promoter of the company himself is a dog lover. Being a dog lover the pet business was his first preference. He did some market research to find out the scenario of pet shop and the demand. He noticed that although there are plenty of service provider in the market but there are hardly few business who carter to the premium pet market and providing pet luxury services. So he started with offering a Luxury kennel services. Business Motto
"A boarding and grooming center that will leaves your dog happy, relaxed and in great
Product offered and services- Spacious accommodation (kennel), Luxury bed, Plush green run areas, Doggie pool and Premium Food. • • • • Feeding times are done by your requirement once or twice a day. 5* TREAT menu (additional charges apply). Clean fresh water 4 times a day. Daily housekeeping.
000 20. what your dog can expect staying in the deluxe suite. Flat screen TV . While staying in the pool side deluxe suites. The items are given in random order. .000 7.showing dedicated animal shows (movies can be shown at an additional charge).000 so this times the owners have decided to leave no stone upturned to enhance the profitability. • • • • Camera system to see your dog being king/queen.000 100.ae/index.000 20. A brain storming session was held with the top head's and the company on the basis of the market research and figures take form the competitors the targeted a profit of AED 50. your dog will be given the royal of all royal treatments. Personal engraved Bonz Dog Charm with Genuine Swarovski Crystal.000 40. AED Capital Stock Retained earnings Furniture Building Equipment Cash 300. Additional playtime in the outdoor areas..petpalace.500 5.500 Business I'eview Last year the company has earned a profit of only AED 20.http://www.000 52.000 200.000 75.000 this year.php/cattery) The list of assets and liabilities in balance sheet of Dubai Pet world Grooming and kennel centre As on 31dec 2010 is as following.• Dedicated camera system for you to see your dog enjoying his/her holiday (additional charges apply). Premium food menu (Source. • Deluxe bed.000 Note payable Account payable Account receivable Land Dog Supplies AED 75.
The company will raise the funds the company issued Received AED 50. • • Enhance more professional way of delivering services. Joe knows that last year. the company will spend AED 5. he has lost few clients because of the lack of this facility so this year he hired 3 Dog trainer from a reputed training centers. The play area marked an additional area of revenue generation. Professional services As discussed by the board that in kennel and grooming service. The company expects to offer training to at least 50 dogs per month. Expansion of Building To keep pace with its commitment to the customer in providing the quality service. competition handling. Visitor's room and office makeover .000 cash and issued common stock. These trainer will provide the professional dog obedience tanning. the ability of the professional staff is extremely important. The bank made the company sign the notes payable. especially for the dog lovers who like to have this facility for short period or few hours. a huge advertising company will be launched. The funds were used to build and expand the grooming centers. Half of the funds will be spent on building the play areas on the facility and the remaining will be spent on completing and building the training and play area. Having aggressive marketing for the accomplishment of the strategy- Steps undertaken Sources offunds The company decided to make over and reposition as unique service provider of full range of luxury services to pets.• The strategy includes expansion of facilities from boarding and grooming to cementarty and obedience training.000 on the buying the special dog play areas equipments this amount has been paid by a bank loan. For every dog trained a course of three days is offered at an effective price of AED SOOper dog. To ensure to increase the customer base.
000.000 on account. The business 04-Jan purchased furniture for changing the room interiors costing AEO 20.000 Bought the food supplies on account for pets AEO 3.000 cash and issued common stock. Bought OS-Jan dog and cat food (supplies) for AEO 6.000. The business paid AEO 8.000 toward the furniture purchased of AED 20.000 on account. Equipment worth 5. She feels that the a sofa.A sofa has been purchased on 9th Jan for the office at AEO 20.000 in Transaction above 09-Jan The business paid employee ll-Jan 13-Jan 14-Jan I8-Jan 23-Jan 23-Jan Paid for Advertisement Paid cash expenses AEO 2. In order to ensure proper hygiene for the pets special reusable pet mats were OS-Jan purchased for 5000 on account from Kanti lal. Mr. of land.000 Expenses paid for the vaccination of Dogs and cats AED 2000 half of it is paid by 25-Jan cash and the remaining is to be paid after three months. Apart from the above transactions the other events and transactions that took place ill company during Jan 2011 are asfollowing. The company agreed to pay after 45 days.000 for the purchase 02-Jan the areas in near future. The land will be utilized for expanding Paid AED 10.200 AEO 1000 for electricity Service revenue earned from dog training session AEO 25. A notes Payable was Took a bank loan for purchasing 7-Jan signed for the loan. Ot-Jan Received AED 50. .000 salaries of AED 6000 in cash for January. Harsh bought a scooter for his personal use for AEO 2. Mrs. Moreover she suggested the has made a loss of AEO 7000 by purchasing accountant to further explore the market if the furniture price has further reduced.000 Paid the salary to the dog trainers AEO 2. Benz who is the secretary believes that the same sofa is available company for AEO 13000 in the market.
The value of the building purchased is steadily increasing in the market. The owner approaches you to help him out in making a proper Income statement and balance sheet for the company to know whether he is successful in achieving his target profit or not? Given is the format of Transaction Analysis.000 to buy the office building. Assets = Liability + Owner's Equity . has become a rapidly growing area in the city. Show the balance after each transaction. one full time receptionist. The supplies remaining at the end of the month are AED 500 The market.000. The total 31 st Jan 31 sr Jan salary paid to all the staff and managerial level worker is AED 4. The employees of the company are very loyal and committed and giving their best to earn the profit. Our 31 sl Jan competitor is ready to give AED 70. one full time and one pat time groomer. where the office is located.26-1an Participation fee received for Dog shows AED 300 The company employs a full time bather. The personnel are cross trained to perform all non specialized jobs in the kennel. The experience range of the kennel employees is some where I to 8 years. four part time kennel assistants. *The over all prices of the Dubai economy is increasing as a result the purchasing power of the cash has been decreased.
statement of retained earnings and balance sheet and cash flow statement at the end of one month. Is Shabir successful in achieving his target profit? 7. Prepare a corrected Balance sheet of last year and arrange the assets and liabilities in order of Liquidity. Bal. 5. TOTAL ASSET --TOTAL LlABI LlTIES Assignment questions1. Prepare the business transaction Analysis and show its effect on basic accounting equation: Assets =Liabilities + Equity. g) Bal. Identify the amounts to be recorded in books of account and on what fundamental accounting principles are applied for such decision. 2. e) Bal. 3. 4.ASSETS = Ale Receivable Building Supplies LIABILITIES STOCKHOLDER'S EQUITY Cash AIC Payable Common Stock Retained Earnings a) b) c) Bal. k) Bal. d) Bal. i) Bal. h) Bal. Explain the principle applied for- . 6. j) Bal. Give your opinion "has the company position become stronger as compared to 31 st Dec 2010. f) Bal. Prepare income statement.
000 to buy the office building. She feel that the company has made a loss of AED 7000 by purchasing a sofa. where the office is located. A sofa has been purchased on 9th Jan for the office at AED 20. The over all prices of the Dubai economy is increasing as a result the purchasing power of the cash has been decreased. b. Mrs.000. The value of the building purchased is steadily increasing in the market. Our competitor is ready to give AED 70. . Benz who is the secretary believes that the same sofa is available for AED 13000 in the market. Moreover she suggested the accountant to further explore the market if the furniture price has further reduced.a. The market. c. has become a rapidly growing area in the city.