ASSETSNon-current assetsProperty, plant and equipmentLand3.130,000Equipment at costDepreciation10,0009.000139,000(1,000)Current assetsInventories6,0003,000200ReceivablesPrepaid expenses: WaterRates200Cash29.400168.40020.000Total assetsEquity and LiabilitiesEquityOriginal Capital (Owner's Capital)Retained profit120,00025.400 145,400LiabilitiesLong-term liabilitiesMortgage10,200Short-term liabilitiesTrade payablesAccrued expenses: RentTax payableTotal Equity and Liabilities2,5005009.80012.800168.400 During 2020, the following transactions took place:1. The owners introduced new capital in the form of cash £10,000.2. Water bill for the year £2,000 and the owner paid £1,800 in cash at the end of thefinancial year.3. Inventories total £60,000 was purchased on credit.4. Inventories total £20,000 was purchased for cash.5. Credit sales revenue during the year total £75,000 (cost £35,000).6. Cash sales revenue during the year total £100,000 (cost £50,000).7. Building continued to be rented at annual rental of £10,000. During the year, ownerpaid in cash £10,500 plus £1,000 towards the next year.8. Rates on the premises were paid in cash during the year as follows: for the period 1April 2020 to 31 March 2021 was £1,200.9. Receipts from trade receivables total £52,000.10.A new delivery van was bought for cash during the year for £16,000 and the usefullife of the asset is 7 years. The expected residual value of the asset is £2,000.11.Payments to trade payables total £40,000.12. During the year total wages £12,000 was paid in cash however at the end of the year,the business found out £2,000 of wages for the last week of the year was not paid.13. Bank Loan £10,200 full amount paid back during the year.14. The owner brought in a machine for £5,000 to the business and the useful life of theasset is 4 years. The expected residual value of the assest is £1,000.15. The short-term loan £5,000 received were deposited in the business bank account.16.The corporation tax bill for 2020 is £10,000 half of which was paid in cash during theyear and the balance was carried forward towards the next financial year.The business uses the straight-line method for depreciating its non-current assets.

Journal Entry The purpose of preparing the journal entry to enter the required transaction into…

April 2020 to 31 March 2021 was £1,200. 9. Receipts from trade receivables total £52,000. 10.A new delivery van was bought for cash during the year for £16,000 and the useful life of the asset is 7 years. The expected residual value of the asset is £2,000. 11.Payments to trade payables total £40,000. 12.During the year total wages £12,000 was paid in cash however at the end of the year, the business found out £2,000 of wages for the last week of the year was not paid. 13. Bank Loan £10,200 full amount paid back during the year. 14. The owner brought in a machine for £5,000 to the business and the useful life of the asset is 4 years. The expected residual value of the assest is £1,000. 15. The short-term loan £5,000 received were deposited in the business bank account. 16. The corporation tax bill for 2020 is £10,000 half of which was paid in cash during the year and the balance was carried forward towards the next financial year.

April 2020 to 31 March 2021 was £1,200. 9. Receipts from trade receivables total £52,000. 10.A new delivery van was bought for cash during the year for £16,000 and the useful life of the asset is 7 years. The expected residual value of the asset is £2,000. 11.Payments to trade payables total £40,000. 12.During the year total wages £12,000 was paid in cash however at the end of the year, the business found out £2,000 of wages for the last week of the year was not paid. 13. Bank Loan £10,200 full amount paid back during the year. 14. The owner brought in a machine for £5,000 to the business and the useful life of the asset is 4 years. The expected residual value of the assest is £1,000. 15. The short-term loan £5,000 received were deposited in the business bank account. 16. The corporation tax bill for 2020 is £10,000 half of which was paid in cash during the year and the balance was carried forward towards the next financial year.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

The asset - vehicle worth £21,200 will be depreciated by 10% at the end of the year. Which nominal accounts should be debited and credited, respectively? a) Debit Depreciation A/c & Credit Non-Current Asset A/c b) Debit Inventory A/c & Credit Depreciation A/c c) Debit Balance Sheet A/c & Credit Profit or Loss A/c
please help answer
In 2018 an asset was purchased for $8,000,000. It was not eligible for initial allowance. annual allowance rate was 10%. The asset was sold in 2022 for $8,500,000. Capital allowance is on the straight-line basis. The balancing adjustment is: a. $3,700,000 b. $4,500,000 c. $4,000,000 d. $3,200,000
Am. 355.
If an asset cost £27,000 with no scrap value, and the annual depreciation charge calculated using the straight-line method is £6,750 per annum, then depreciation is being charged at the rate of(SLM depreciation rate)?
In 2018 an asset was purchased for $2,000,000. The asset qualified for Initial Allowance. The Initial Allowance (I.A) Rate was 20%. Annual Allowance (A.A) Rate was 10%. The asset was sold in 2020 for $1,000,000. Capital allowance is on the reducing balance basis. The balancing adjustment is: a.A Balancing Charge of $260,000 b.A Balancing Allowance of $134,000 c. ABalancing Allowance of $260,000 d. A Balancing charge of $200,000
Happy Meal Limited a food manufacturer is considering purchasing a new machine for £320,000. The company is expecting an annual cash inflow of £105,000 from the sale of products and an annual cash outflow of £15,500 for each of the six years of the machine's useful life. The annual cash outflows do not include annual depreciation charges for the machine. The machine is depreciated using a 15% reducing method. The machine is expected to last for six years, with a residual value estimated to be at the rate of 10% of the original cost of the machine. The cost of capital for Happy Meal Limited is 12%. You are required to: (a) Calculate using the following investment appraisal techniques, and provide brief recommendations as to the economic feasibility of acquiring the machine: i. The Payback Period. ii. The Accounting Rate of Return. ii. The Net Present Value. iv. The Internal Rate of Return (to two decimal places)
show the Internal Rate of Return of Machine B (expressed to two decimal places) using interpolation if the net cash flows are R290 000 per year for four years.
The current asset section of the Moorcroft Outboard Motor Company's balance sheet reported the following amounts: Accounts receivable, net The average collection period for 2021 is 50 days. 12/31/2021 12/31/2020 $500,000 $400,000 Required: Determine net sales for 2021. (Use 365 days in a year. Do not round intermediate calculations.) Net sales $ 450,000
On January 1, 2021, Gringo Company had capitalized cost of P5,000,000 for a new computer software product with an economic life of 5 years. Sales for 2021 amounted to P3,000,000. The total sales of software over its economic life are expected to be P10,000,000. The pattern of future sales cannot be measured reliably. On December 31, 2021, the software had a net realizable value of P4,500,000. What is the carrying amount of the computer software on December 31, 2021?
Additional information:i. Supplies as at 31st December 2019, RM34,500.ii. Insurance expense at the rate of RM850 per month.iii. Yearly depreciation on the non current assets as below:• furniture and fittings, RM5,175• motor vehicles, RM20,400.iv. Interest expense RM5,295 still payable by end of the yearv. Estimated doubtful debt at the rate of 2% of accounts receivable Question: 1. Prepare the Statement of Profit or Loss and Other Comprehensive Income for the year ended 31st December 2019. 2. Prepare the Statement of Financial Position as at 31st December 2019.
Please provide complete solutions. Thank you