Question
In: Accounting
Target LLC company is one of the supplier for PDO in Oman. The company is has...
Target LLC company is one of the supplier for PDO in
Oman. The company is has started to set up facilities in Fahud and
Duqm region in Oman. You are the accountant of the company. Your
management wants you to prepare the financial statement in such a
way, easy for them to understand. You are required to present the
Trial Balance and the financial statements after incorporating the
adjustments in a single statement using excel. The following are
the details of the Trial Balance for the company.
Particulars
Amount (RO)
Return Outward 406,000
Commission Income 103,250
General reserve 1,400,000
Accumulated Depn-Heavy vehicles 612,500
Equity Share Capital 10,500,000
Revenue 19,775,000
Bank Muscat – Loan 2,100,000
Accounts Receivables 3,062,500
Cash and Bank 592,200
Property Building premises 7,000,000
Directors Fees 120,455
Income Tax 63,895
Income from Investment 184,350
Heavy vehicles –Cost 1,225,000
Salaries 1,020,600
Selling and Dist exp 1,925,000
Sundry Creditors 2,562,000
Conveyance expense 14,188
Insurance expense 16,350
Discount Income 33,663
Maintenance Expense 3,125
Air-conditioning Plant 7,000,000
Purchases 13,827,100
Returns inwards 929,250
Carriage Outwards 877,100
Repair & Renewals 56,900
Telephone Expense 23,640
Petrol Expense 17,260
Bills payables 70,100
Profit on sale of property 27,700
Adjustments
1. Depreciation on Heavy Vehicles is 30%
2. Closing stock was RO 150,000
3. Provision for Doubtful Debts is made @ 5% on closing
receivables
4. Transfer to general reserve during the year is RO 175,500
. 5. Insurance prepaid was RO 1,350
Solutions
Expert Solution
| Account Title | Dr | Cr | |
| 1 | Depreciation expense (1225000-612500)*30% | 183750 | |
| Accumulated Depr-Heavy Vehicles | 183750 | ||
| (Assuming Declining Balance method) | |||
| 2 | Inventory | 150000 | |
| Income Summary | 150000 | ||
| 3 | Bad Debts (3062500*5%) | 153125 | |
| Provision for Bad Debts | 153125 | ||
| 4 | Profit & Loss A/c | 175500 | |
| General Reserve | 175500 | ||
| 5 | Prepaid Insurance | 1350 | |
| Insurance expense | 1350 |
| Account name | Trial Balance | Adjustments | Adjusted Trial Balance | |||
| Dr | Cr | Dr | Cr | Dr | Cr | |
| Sundry Creditors | - | 2,562,000 | - | 2,562,000 | ||
| Bills payables | - | 70,100 | - | 70,100 | ||
| Provision for Bad Debts | - | - | 153,125 | - | 153,125 | |
| General reserve | - | 1,400,000 | 175,500 | - | 1,575,500 | |
| Accumulated Depn-Heavy vehicles | - | 612,500 | 183,750 | - | 796,250 | |
| Equity Share Capital | - | 10,500,000 | - | 10,500,000 | ||
| Bank Muscat – Loan | - | 2,100,000 | - | 2,100,000 | ||
| Accounts Receivables | 3,062,500 | - | 3,062,500 | - | ||
| Prepaid Insurance | - | - | 1,350 | 1,350 | - | |
| Inventory | - | - | 150,000 | 150,000 | - | |
| Cash and Bank | 592,200 | - | 592,200 | - | ||
| Heavy vehicles –Cost | 1,225,000 | - | 1,225,000 | - | ||
| Air-conditioning Plant | 7,000,000 | - | 7,000,000 | - | ||
| Property Building premises | 7,000,000 | - | 7,000,000 | - | ||
| Income Summary | - | - | 175,500 | 150,000 | 175,500 | 150,000 |
| Revenue | - | 19,775,000 | - | 19,775,000 | ||
| Return Outward | - | 406,000 | - | 406,000 | ||
| Commission Income | - | 103,250 | - | 103,250 | ||
| Discount Income | - | 33,663 | - | 33,663 | ||
| Income from Investment | - | 184,350 | - | 184,350 | ||
| Directors Fees | 120,455 | - | 120,455 | - | ||
| Income Tax | 63,895 | - | 63,895 | - | ||
| Salaries | 1,020,600 | - | 1,020,600 | - | ||
| Selling and Dist exp | 1,925,000 | - | 1,925,000 | - | ||
| Conveyance expense | 14,188 | - | 14,188 | - | ||
| Depreciation expense | - | - | 183,750 |
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