Blyth Traders are a well-established wholesale business operating in the north of England and south Scotland. Their trial balance for year ended 31st December 2021 is presented below: Dr [£] Cr [£] Non-current assets (cost): Plant and machinery 150,000 Vehicles 100,000 Premises 600,000 Accumulated depreciation (1-1-21): Plant and equipment 90,000 Vehicles 50,000 Premises 96,000 Sales 829,000 Sales returns 2,000 Purchases 335,000 Carriage in 15,000
Blyth Traders are a well-established wholesale business operating in the north of England and south Scotland. Their trial balance for year ended 31st December 2021 is presented below: Dr [£] Cr [£] Non-current assets (cost): Plant and machinery 150,000 Vehicles 100,000 Premises 600,000 Accumulated depreciation (1-1-21): Plant and equipment 90,000 Vehicles 50,000 Premises 96,000 Sales 829,000 Sales returns 2,000 Purchases 335,000 Carriage in 15,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![Blyth Traders are a well-established wholesale business operating in the north of England
and south Scotland. Their trial balance for year ended 31st December 2021 is presented
below:
Dr [£]
Cr [£]
Non-current assets (cost):
Plant and machinery
150,000
Vehicles
100,000
Premises
600,000
Accumulated depreciation (1-1-21):
Plant and equipment
90,000
Vehicles
50,000
Premises
96,000
Sales
829,000
Sales returns
2,000
Purchases
335,000
Carriage in
Wages and salaries
Discounts allowed
15,000
114,000
4,500
Electricity costs
Vehicle maintenance
37,500
2,500
8,000
Advertising and marketing
14,000
Irrecoverable debts
3,000
Allowance for receivables
1,500
Bank
19,200
Accounts payable
31,600
Accounts receivable
60,000
Inventory (1-1-21)
Drawings
Bank loan [10%]
Capital (1-1-21)
91,700
60,000
150.000
324,900
1,594,700
1,594,700
Additional notes:
1) Inventory at 31st December 2021 was valued at £94,000. However, on 4th
January 2022 additional lines of inventory were uncovered that had not been
included in the previous count. At cost this inventory would be valued at £5,000
but 50% of the items were damaged and would probably fetch £500 at auction.
Auction fees would be £100.
2) Salary bill for Blyth is £10,000 per month.
3) The electricity charge represents 15 months payment to 1st March 2022.
4) Blyth pays a local garage £800 per month for maintenance and fuel costs. Arrears
to be settled by the end of the first week in 2022.
5) The contract for advertising is with a newly established local company and Blyth
has supported the company by settling the contract from 1st January 2021 up to
the end of April 2022.
6) Blyth decides at the end of 2021 to double the allowance on receivables.
7) Blyth disposed of an item of plant in 2021 for £8,000. The plant had been
purchased in 2018 at a cost of £40,000 (Blyth charges no depreciation in year of
disposal). This transaction has not yet been recorded in the books of Blyth.
8) Depreciation rates are:
Premises, straight line over 50 years
Plant, 20% straight line
Vehicles, 50% reducing balance](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F794fd03b-e0bb-480e-890d-5fcf5e269b0d%2Fb3a95183-c4aa-4671-a15a-a91ba9b5b335%2Fc71yg2i_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Blyth Traders are a well-established wholesale business operating in the north of England
and south Scotland. Their trial balance for year ended 31st December 2021 is presented
below:
Dr [£]
Cr [£]
Non-current assets (cost):
Plant and machinery
150,000
Vehicles
100,000
Premises
600,000
Accumulated depreciation (1-1-21):
Plant and equipment
90,000
Vehicles
50,000
Premises
96,000
Sales
829,000
Sales returns
2,000
Purchases
335,000
Carriage in
Wages and salaries
Discounts allowed
15,000
114,000
4,500
Electricity costs
Vehicle maintenance
37,500
2,500
8,000
Advertising and marketing
14,000
Irrecoverable debts
3,000
Allowance for receivables
1,500
Bank
19,200
Accounts payable
31,600
Accounts receivable
60,000
Inventory (1-1-21)
Drawings
Bank loan [10%]
Capital (1-1-21)
91,700
60,000
150.000
324,900
1,594,700
1,594,700
Additional notes:
1) Inventory at 31st December 2021 was valued at £94,000. However, on 4th
January 2022 additional lines of inventory were uncovered that had not been
included in the previous count. At cost this inventory would be valued at £5,000
but 50% of the items were damaged and would probably fetch £500 at auction.
Auction fees would be £100.
2) Salary bill for Blyth is £10,000 per month.
3) The electricity charge represents 15 months payment to 1st March 2022.
4) Blyth pays a local garage £800 per month for maintenance and fuel costs. Arrears
to be settled by the end of the first week in 2022.
5) The contract for advertising is with a newly established local company and Blyth
has supported the company by settling the contract from 1st January 2021 up to
the end of April 2022.
6) Blyth decides at the end of 2021 to double the allowance on receivables.
7) Blyth disposed of an item of plant in 2021 for £8,000. The plant had been
purchased in 2018 at a cost of £40,000 (Blyth charges no depreciation in year of
disposal). This transaction has not yet been recorded in the books of Blyth.
8) Depreciation rates are:
Premises, straight line over 50 years
Plant, 20% straight line
Vehicles, 50% reducing balance
![Required:
(a)
Prepare a statement of profit or loss for y/e 31st December 2021 and a
statement of financial position as at that date.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F794fd03b-e0bb-480e-890d-5fcf5e269b0d%2Fb3a95183-c4aa-4671-a15a-a91ba9b5b335%2F63152fr_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Required:
(a)
Prepare a statement of profit or loss for y/e 31st December 2021 and a
statement of financial position as at that date.
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