QUESTION 1
R. Holmes
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The following trial balance was extracted from the books of N. Holmes, a spare parts dealer, at the close of business on 31 March 2018.
DR CR
£ £
Capital 20,000
Purchases and Sales 92,000 160,000
Trade Payables and trade receivables 15,000 6,100
Discounts 820 400
Carriage Outwards 900
Drawings 18,000
Rent & Rates 7,900
Heating and Lighting 4,000
Bad debts 200
Salaries and Wages 31,000
Cash in hand 195
Bank 1,100
Inventory, 01 April 2017 5,650
Delivery Van 7,500
Motor running expenses 630
Shop fittings at cost 6,000
Allowance for receivables 01 April 2017 320
Provision for Depreciation, Delivery van, 01 April 2017 1,875
189,795 189,795
Notes
Inventory at 31 March 2018 was £2,800.
N. Holmes took out spare parts costing £300 for the repair of his private car. No payment was made for these goods
Rent prepaid at 31 March 2018 was 800
Motor running expenses owing at 31 March 2018 was £90
Adjust the allowance for receivables to 2% of trade receivables
Provide for depreciation at 31 March 2018 as follows:
Delivery Van 25% on the reducing balance basis
Shop fittings 20% on the straight-line basis
Required:
Draw up the statement of profit or loss for the year ended 31 March 2018 together with the statement of financial position as at 31 March 2018
QUESTION 2
Trial Balance as at 31 December 2006
Dr Cr
£ £
Advertising 30
Bank 122
Creditors 69
Bank Loan 74
Bank Interest 8
Debtors 320
Directors, remuneration 55
Electricity 28
Insurance 17
Machinery:
At Cost 600
Accumulated depreciation (at 1.1.2006) 240
Office expenses 53
£1Ordinary share capital (issued and fully paid) 250
Profit and loss account (at 1.1.2006) 132
Purchases 2380
Rent 75
Rates 25
Sales 3240
Stock (at 1.1.2006) 134
Wages and salaries 158
——– ——–
£4005 £4005
Additional Information:
1. Stock at 31st December 2006 valued at cost amounted to £150
2. Depreciation is to be provided on machinery at 20% on cost.
3. Provision is to be made for auditors’ remuneration of £12
4. Rent paid in advance at 31st December 2006 amounted to £3
Prepare profit and loss account and balance sheet for the year end 31/12/2006
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