Following Trial Balance has been extracted from the books of Lexounde Ltd. as on 31 December 2019: ACCOUNTS DEBIT £ CREDIT £ Cash in hand 3,400 Bank Balance 18,660 Stock 1st Jan 2018 46,000 Purchase and purchase returns 150,200 600 Freehold premises 38,600 Incidental trade expenses 840 Insurance 1,640 Audit fees 280 Commission received 3,300 Bank overdraft 4,000 Interest on Bank Overdraft 200 Trade Debtors 36,000 Trade Creditors 34,670 Wages 25,000 Salaries 14,000 Capital 114,000 Drawings 5,000 Income tax 1,600 Investments 4,000 Discount allowed and received 6,300 4,600 Sales return and sales 550 201,350 Bills receivable 3,200 Office furniture 3,050 Rent 4,000 362,520 362,520 Following month end adjustments need to be incorporated in the above trial balance: Stock at 31 December 2019 is £ 52,000 Write off 5% depreciation on freehold premises and 10% on office furniture Unpaid wages are £ 4,200 Insurance to the extent of £ 200 relates to the year 2019 – 2020 Charge interest on capital @ 5% and 300 on drawings. Rent is payable at the rate of £ 400 per month. Required: Prepare month end adjustment journals for the month of 31 December 2019 Prepared adjusted trial balance as on 31 December 2019
Following
|
ACCOUNTS |
DEBIT £ |
CREDIT £ |
|
Cash in hand |
3,400 |
|
|
Bank Balance |
18,660 |
|
|
Stock 1st Jan 2018 |
46,000 |
|
|
Purchase and purchase returns |
150,200 |
600 |
|
Freehold premises |
38,600 |
|
|
Incidental trade expenses |
840 |
|
|
Insurance |
1,640 |
|
|
Audit fees |
280 |
|
|
Commission received |
|
3,300 |
|
Bank overdraft |
|
4,000 |
|
Interest on Bank Overdraft |
200 |
|
|
Trade Debtors |
36,000 |
|
|
Trade Creditors |
|
34,670 |
|
Wages |
25,000 |
|
|
Salaries |
14,000 |
|
|
Capital |
|
114,000 |
|
Drawings |
5,000 |
|
|
Income tax |
1,600 |
|
|
Investments |
4,000 |
|
|
Discount allowed and received |
6,300 |
4,600 |
|
Sales return and sales |
550 |
201,350 |
|
Bills receivable |
3,200 |
|
|
Office furniture |
3,050 |
|
|
Rent |
4,000 |
|
|
|
362,520 |
362,520 |
Following month end adjustments need to be incorporated in the above trial balance:
Stock at 31 December 2019 is £ 52,000
Write off 5%
Unpaid wages are £ 4,200
Insurance to the extent of £ 200 relates to the year 2019 – 2020
Charge interest on capital @ 5% and 300 on drawings.
Rent is payable at the rate of £ 400 per month.
Required:
Prepare month end adjustment journals for the month of 31 December 2019
Prepared adjusted trial balance as on 31 December 2019
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