Question

In: Accounting

QUESTION 2 You have been contacted by the owner of a Jewelery Retail shop, Magna Qarta...

QUESTION 2

You have been contacted by the owner of a Jewelery Retail shop, Magna Qarta , to prepare their accounts. You observe that they do not have a full set of accounts. However, you extract the following data from their records

Balances as at 31/12/2019

Property, plant and equipment

235000

Accumulated Depreciation

57246

inventories

84600

Receivables

47000

Pepayments-Rates

1880

Bank

9400

Cash

2820

Creditors

18800

Electricity Accrued

1175

Balances as at 31/12/2020

inventories

159330

Receivables

56400

Pepayments-Rates

2115

Bank overdraft

72850

Cash

2820

Creditors

21620

Electricity Accrued

1410

The records show cash and bank transactions as follow:

Cash Receipts

Balance B/D

2820

Sales

70500

Cash Payments

Deposit into bank

70500

Bank Receipts

Balance B/D

9400

Accounts Receivable

658000

5% Loan received

141000

Sale proceeds from sale of motor van

38540

Cash banked

70500

Bank Payments

Accounts Payables

517000

Rates

42300

Electricity

9400

Telephone

7050

Loan Interest

7050

Insurance

4700

Wages and Salaries

94000

Drawings

117500

Property, Plant and Equipment

188000

Sundry Expenses

3290

ADDITIONAL INFORMATION

The loan was received on 1st January 2019 and depreciation for PPE is at 20% per annum

Cost of motor van that was disposed off

47000

Accumulated Depreciation of the motor van that was disposed off

8930

Discount received during the year amounted to

9400

During the year the owner gifted a pair of earings to his daughter worth

9400

Solutions

Expert Solution

ekkarill92 answered 2 years ago
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