Question

Question 2: From the following account balances to 30 June 2020 prepare a statement of financial position in the narrative classified format. Note: you will need to determine the balance of the retained earnings.                                                                                  

Type of Account	$
Accounts Receivable	46500
Provisions	50000
Prepayments	1200
Sales Revenue	455000
Plant and Equipment	220000
Other Current Assets	11000
Borrowings	120000
Interest on Borrowings E	6000
Accumulated Depreciation	48500
Accounts Payable	26000
Share Capital	450000
Land and Buildings	339000
Inventory	78000
Two Year Term Deposit	98500
Cash at Bank	32000
Retained Earnings	?
Salaries expense	215000
Salaries Accrued	12500
Insurance Expense	9000
Annual Depreciation	22000
Utilities Expense	8500
Selling Expenses	25000

Question 3: From the accounts in question 2 above prepare a statement of profit or loss position for the period ended 30 June 2020.    

Answer 1

The solution to (2)

Statement of Financial Statement as on 30th June, 2020

Particulars	Amount	Amount
Current Assests Accounts Receivable Prepayments Inventory Cash at Bank Non-Current Assets Plant and Equipment (-) Accumulated Depreciation (-) Annual Depreciation Other Current Assets Land and Building Term Deposit Total Assets	220000 (48500) (22000)	46500 1200 78000 32000 171500 11000 339000 98500 755700
Current Liabilities Provisions Accrued Salaries Borrowings Accounts Payable Equity Share Capital Retained Earnings (balancing figure) Total Liabilities		50000 12500 120000 26000 450000 97200 755700

The solution to (3)

Statement of Profit and Loss Period for the period ended 30th June, 2020

Particulars	Amount	Particulars	Amount
To Interest on Borrowings To Salaries Expense 215000 Add: Accrued Salary 12500 To Insurance Expenses To Annual Depreciation To Utility Expense To Selling Expense To Net Profit (b/f)	6000 227500 9000 22000 8500 25000 157000 455000	By Sales Revenue	455000 455000