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Question 2 The following trial balance was extracted from the books of R Giggs at the...

Question 2
The following trial balance was extracted from the books of R Giggs at the close of business on 28 February 2007.
Dr Cr
RM RM
Purchases 92,800
Sales 157,165
Cash at bank 4,100
Cash in hand 324
Capital 11,400
Drawings 17,100
Office furniture 2,900
Rent 3,400
Wages and salaries 31,400
Discount received 160
Discount allowed 820
Accounts receivable 12,316
Accounts payable 5,245
Inventory 1/3/2006 4,120
Provision for doubtful debts 405
Motor vehicles 3,750
Motor expenses 615
Bad debts 730
174,375 174,375

Additional information:
1. Inventory as at 28/2/2007 was RM2,400.
2. Wages and salaries accrued at 28/2/2007 RM340.
3. Rent prepaid at 28/2/2007 RM230.
4. Motor expenses owing at 28/7/2007 RM72.
5. Increase in provision for doubtful debts by RM91.
6. Provide for depreciation as follows: office furniture RM380, motor vehicles RM1,250.
Required:
Draw up the Income Statement (Profit and Loss) for the year ended 28/2/2007 together with a Financial Positions (Balance Sheet) as at 28/2/2007.

Question 2
The following trial balance was extracted from the books of R Giggs at the close of business on 28 February 2007.
Dr Cr
RM RM
Purchases 92,800
Sales 157,165
Cash at bank 4,100
Cash in hand 324
Capital 11,400
Drawings 17,100
Office furniture 2,900
Rent 3,400
Wages and salaries 31,400
Discount received 160
Discount allowed 820
Accounts receivable 12,316
Accounts payable 5,245
Inventory 1/3/2006 4,120
Provision for doubtful debts 405
Motor vehicles 3,750
Motor expenses 615
Bad debts 730
174,375 174,375

Additional information:
1. Inventory as at 28/2/2007 was RM2,400.
2. Wages and salaries accrued at 28/2/2007 RM340.
3. Rent prepaid at 28/2/2007 RM230.
4. Motor expenses owing at 28/7/2007 RM72.
5. Increase in provision for doubtful debts by RM91.
6. Provide for depreciation as follows: office furniture RM380, motor vehicles RM1,250.
Required:
Draw up the Income Statement (Profit and Loss) for the year ended 28/2/2007 together with a Financial Positions (Balance Sheet) as at 28/2/2007.    

Solutions

Expert Solution

R Giggs
Income Statement
Year Ended 28/2/2007
Amount in RM
Revenue:
Sales              157,165
Discount Received                       160
Total Revenue              157,325
Expenses:
Cost of Goods sold ( 4,120 + 92,800 - 2,400 )                  94,520
Discount allowed                       820
Rent Expense (3,400 - 230 )                    3,170
Wages & Salaries expense (31,400 + 340 )                  31,740
Motor expenses ( 615 + 72 )                       687
Depreciation Expense (380 + 1,250 )                    1,630
Bad Debts ( 730 + 91 )                       821
Net Income                 23,937
R Giggs
Financial Position as at 28/2/2007
Assets Amount in RM
Non-current assets
Office Furniture , Net of Depreciation (2,900 - 380 )                    2,520
Motor Vehicles   , Net of Depreciation (3,750 - 1,250 )                    2,500
Current assets
Cash at bank                    4,100
Cash in hand                       324
Accounts Receivables, net of provision for doubtful debt (12,316 - (405 + 91 ) )                  11,820
Inventory 28/2/2007                    2,400
Prepaid Rent                       230
Total Assets                 23,894
Owner's Equity & Liabilities
Owner's Equity
Capital ( 11,400 + 23,937 - 17,100 )                  18,237
Current Liabilities
Accounts Payable                    5,245
Motor expense payable                         72
Wages & Salaries Payable                       340
Total Owner's Equity & Liabilities                 23,894

ekkarill92 answered 1 year ago
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