Question

In: Accounting

George is the owner of Hornby’s Restaurant. George has asked you to support him with the...

George is the owner of Hornby’s Restaurant. George has asked you to support him with the preparation of a Balance Sheet and an Income Statement as of 30 June 2020. The information below was provided by George as at 30 June 2020.

Item

$

Capital (at 1 July 2019)

480,000

Bank loan (due in 2024)

400,000

Plant and kitchen equipment

55,000

Bank overdraft

25,000

Accounts receivable

50,000

Depreciation on fixed assets

10,000

Drawings

110,000

Accounts payable

60,000

Cash in bank

33,000

Food revenue

35,000

Rental costs

25,000

Employee wages

95,000

Beverage revenue

100,000

Land and restaurant buildings

95,000

To help George, you are required to calculate the total amounts (as of 30 June 2020) for the following positions. Please provide for each position the calculations.

a) current assets

b) non-current assets

c) current liabilities

d) non-current liabilities

e) expenses

f) revenues

g) profit/(or loss)

h) equity

Solutions

Expert Solution

Computation of Current Asset
Account Receivable $50,000.00
Cash $33,000.00
Total Current Asset $83,000.00
Computation of Non Current Asset
Plantt & Kitcheen Equipment $50,000.00
Less; Depreciaiton on Fixed Asset -$10,000.00
Land & Restaurent Building $95,000.00
Total Non Current asset $135,000.00
Computation of Current Liabilities
Bank Overdraft $25,000.00
Accotn Payable $60,000.00
Total Current Liabiltiies $85,000.00
Computation of Expenses
Depreciaiton on Fixed Asset $10,000.00
Rental Cost $25,000.00
Employee Wages $95,000.00
Total Expense $130,000.00
Computation of Revenue
Food Revenue $35,000.00
Beverage Revenue $100,000.00
Total Revenue $135,000.00
Computation of Profit / Loss
Total Revenue $135,000.00
Less: Expense $130,000.00
Profit $5,000.00
Computation of Equity
Capital Beginning $480,000.00
Less: Drawing -$110,000.00
Aadd; Net Incom e $5,000.00
Total Equity $375,000.00
Computation of Non Current Liabilities
Bank Loan $400,000.00
Total Non Current asset $400,000.00

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