Question

Q6. The following trial balance has been extracted from the books of Abrantier Enterprises as at 31^st May 2019

                                                                         Dr                            Cr

                                                                        Gh¢                          Gh¢

Advertising                                                  46,000

Bank                                                              6,000

Cash                                                               2,000

Capital                                                                                         1,114,000

Discount allowed                                          2,000

Discount received                                                                           12,000

Drawings                                                    340,000

Electricity                                                     26,000

Investment                                                    80,000

Investment income received                                                          8,000

Office equipment                                       200,000

Trade Creditors                                                                           104,000

Other creditors                                                                              16,000

Trade debtors                                             130,000

Other debtors                                               30,000

Machinery                                                  400,000

Purchases                                                   428,000

Purchases return                                                                            28,000

Sales                                                                                         1,260,000

Sales return                                                  60,000

Stationery                                                     18,000

Wages                                                        774,000

                                                                2,542,000                   2,542,000

Required

a) Prepare a Profit and Loss Account/Income Statement for Abrantier Enterprises for the period ended 31^st May 2019 and

b) Balance Sheet at that date

NB. No beginning and no closing stock

Answer 1

Solution: 1
	Income Statement
	For the year Ended 31st May 2019
	Revenues:	Amount	Amount
	Sales Revenue	$         12,60,000
	Less: Sales Returns	$               60,000
	Less: Discounts	$                  2,000
	Net Sales		$      11,98,000
	Investment income received		$              8,000
	Total REVenue		$      12,06,000
	Less: Purchases
	Purchases	$            4,28,000
	Less: Purchase Return	$               28,000
	Less: Discount received	$               12,000
	Net Purchases		$        3,88,000
	Gross Revenue		$        8,18,000
	Expenses:
	Advertising Expenses	$               46,000
	Electricity	$               26,000
	Stationary	$               18,000
	Wages	$            7,74,000
	Total Expenses		$        8,64,000
	Net Income		$          -46,000
	CAPITAL ACCOUNT
	Beginning Balance	$         11,14,000
	Add (Less) income of the year	$              -46,000
	Less: Drawings	$            3,40,000
	Ending Balance	$            7,28,000
Solution: 2
	BALANCE SHEET
	For the year Ended 31st May 2019
	ASSETS	AMOUNT	AMOUNT
	CURRENT ASSETS:
	Cash & Bank	$                  8,000
	Trade Debtors	$            1,30,000
	Other Debtors	$               30,000
			$        1,68,000
	Investment		$            80,000
	FIXED ASSETS:
	Office Equiment		$        2,00,000
	Machinary		$        4,00,000
	TOTAL OF ASSETS		$        8,48,000
	LIABILITIES & SHAREHOLDER'S EQUITY	AMOUNT	AMOUNT
	CURRENT LIABILITIES:
	Trade Creditors	$            1,04,000
	Other Creditors	$               16,000
			$        1,20,000
	SHAREHOLDER'S EQUITY
	Capital Account		$        7,28,000
	TOTAL OF LIABILITES & SAHREHOLDER'S EQUITY		$        8,48,000