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In: Accounting

QUESTION 1                                        &nbsp

QUESTION 1                                                                                                          [75]

(Integrated question)

The information below was extracted from the books of Malibongwe Traders for the year ending 31 December 2019. IGNORE VAT

Analyse the information given carefully, and work through all the questions in the chronological order giving appropriate responses to each.

Make certain that you articulate your thinking by presenting a well laid out presentation that will reflect your own knowledge and understanding of the topics below.

Take cognizance of the fact that cheating inhibits the ability for personal development and gives a false impression of achievements.

The question consists of part A and Part B

PART B                                                                                                         [40 marks]

LIST OF BALANCES / TOTALS

              R

Inventory (31/12/2019 )

95 440

Land and buildings

220 000

Drawings

46 690

Interest Received

5 100

Capital

210 000

Trade Receivables

26 700

10% Long-Term Loan

118 000

Fixed Deposit

25 000

Bank (CR)

15 030

Rent received

74 110

Stationery

10 130

Trade Payables

23 840

Credit sales

310 000

Cash sales

73 570

Account Payable allowances

2 100

Account Receivable allowances

1 700

Purchases

141 000

Donations Expenses

4 500

Rates and taxes

8 180

Interest on Loan

3 230

Bank charges

1 370

Salaries and wages

103 080

Railage on goods

1 300

Additional information:

  1. Stationery on hand amounted to R 390.
  2. The amount of R 2 890 for credit losses recovered were erroneously credited to Account Receivable Control.
  3. The profits realized on asset disposal were omitted from the trial balance.
  4. Closing inventory was R89 170.
  5. Write off an amount of R1 700 as irrecoverable.
  6. Create an allowance for credit losses of 10% on good trade receivables.
  7. A replacement Vehicle was bought and delivered on the 21 December 2019.
  8. The proceeds from the disposal of asset were omitted in the bank account.

YOU ARE REQUIRED TO:

  1. Prepare The Statement of Financial Position for the year ending
    31 December 2019.                                                                          )

  

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