Further checks revealed the following during 2018: • During the financial year a trade debt of $10.200 owed by Linda Grayson was off set against the $20,000 owing to the same Linda Grayson a trade creditor. • In addition to the goods returned above, Jane Hutton, a cash sales customer returned goods during the financial year amounting to $7.000. Jane Hutton was repaid her $7,000 from the daily cash sales. This was not vet reflected in the business records. • Patsy Knight grants a credit period of 30 days to customers. The closing trade receivables' balance includes a debt of $8,000 from Favela Brown. The goods were sold to Favela in November 2017. Favela went to the United States of America for a two (2) weeks' vacation in February 2018. On December 31, 2018 Favela was still in the USA. • Patsy Knight keeps a cash float of $10,000 for change in his retail outlet. Excess cash 1s deposited in the bank account and cash shortfall is taken from the bank. The accounting fee for preparing the 2018 financial statements is estimated at $45,000. me The following additional information is also available: 1 January 31 December 2018 2018 8,300 19,800 9,400 40,400 1,000 Unventories Machinery Rent paid in advanced Rent outstanding Thu dilo4 Trade receivables Thade ca Trade payables le Loan from bank at 10% Loan interest owing 1,050 18,100 15,700 17,000 19,200 14,800 17,000 750 Required: a) Prepare a statement of affair to show Patsy Knight's capital on 1 January 2018. b) Prepare the Trade receivables Control Account c) Prepare the Trade payables Control Account d) Extract a trial balance as at December 31, 2018. e) Prepare the Income Statement for the year ended 31 December, 2018 ) Statement of changes in owner's equity for the year ended 31 December, 2018. g) Prepare a COMPARATIVE Statement of Financial Position as at 31 December, 2018. h) Prepare a Statement of Cash Flow for the year ended 31 December, 2018
Further checks revealed the following during 2018: • During the financial year a trade debt of $10.200 owed by Linda Grayson was off set against the $20,000 owing to the same Linda Grayson a trade creditor. • In addition to the goods returned above, Jane Hutton, a cash sales customer returned goods during the financial year amounting to $7.000. Jane Hutton was repaid her $7,000 from the daily cash sales. This was not vet reflected in the business records. • Patsy Knight grants a credit period of 30 days to customers. The closing trade receivables' balance includes a debt of $8,000 from Favela Brown. The goods were sold to Favela in November 2017. Favela went to the United States of America for a two (2) weeks' vacation in February 2018. On December 31, 2018 Favela was still in the USA. • Patsy Knight keeps a cash float of $10,000 for change in his retail outlet. Excess cash 1s deposited in the bank account and cash shortfall is taken from the bank. The accounting fee for preparing the 2018 financial statements is estimated at $45,000. me The following additional information is also available: 1 January 31 December 2018 2018 8,300 19,800 9,400 40,400 1,000 Unventories Machinery Rent paid in advanced Rent outstanding Thu dilo4 Trade receivables Thade ca Trade payables le Loan from bank at 10% Loan interest owing 1,050 18,100 15,700 17,000 19,200 14,800 17,000 750 Required: a) Prepare a statement of affair to show Patsy Knight's capital on 1 January 2018. b) Prepare the Trade receivables Control Account c) Prepare the Trade payables Control Account d) Extract a trial balance as at December 31, 2018. e) Prepare the Income Statement for the year ended 31 December, 2018 ) Statement of changes in owner's equity for the year ended 31 December, 2018. g) Prepare a COMPARATIVE Statement of Financial Position as at 31 December, 2018. h) Prepare a Statement of Cash Flow for the year ended 31 December, 2018
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
100%

Transcribed Image Text:Further checks revealed the following during 2018:
• During the financial year a trade debt of $10.200 owed by Linda Grayson was ot ses
against the $20,000 owing to the same Linda Grayson a trade creditor.
In addition to the goods retumed above, Jane Hutton, a cash sales customer returmed
goods during the financial year amounting to $7.000, Jane Hutton was repaid her
S7,000 from the daily cash sales. This was not vet reflected in the business records.
• Patsy Knight grants a credit period of 30 days to customers. The closing trade
receivables' balance includes a debt of $8,000 from Favela Brown. The goods were
sold to Favela in November 2017, Favela went to the United States of America for a
two (2) weeks' vacation in February 2018, On December 31, 2018 Favela was still in
the USA.
• Patsy Knight keeps a cash float of $10.000 for change in his retail outlet. Excess cash
is deposited in the bank account and cash shortfall is taken from the bank.
The accounting fee for preparing the 2018 financial statements is estimated at
$45,000. ncome
The following additional information is also available:
1 January
2018
31 December
2018
8,300
19.800
9,400
40,400
1,000
Inventories
Machinery AN
Rent paid in advanced
Rent outstanding
Trade receivables
Thade cre Trade payables L
Loan from bank at 10%
Loan interest owing
1,050
18,100
15,700
17,000
19,200
14,800
17,000
Trudi del
750
Required:
a) Prepare a statement of affair to show Patsy Knight's capital on 1 January 2018.
b) Prepare the Trade receivables Control Account
c) Prepare the Trade payables Control Account
d) Extract a trial balance as at December 31, 2018.
e) Prepare the Income Statement for the year ended 31 December, 2018
) Statement of changes in owner's equity for the year ended 31 December, 2018.
g) Prepare a COMPARATIVE Statement of Financial Position as at 31 December, 2018.
h) Prepare a Statement of Cash Flow for the year ended 31 December, 2018

Transcribed Image Text:The following are summaries of the cash book and bank accounts of Patsy Knight, a sole
proprietor, who does not keep her books using the double entry system.
Bank Summary
Balance on 1 January 2018
Receipts:
60,000
Receivables a
350,000
22,200
Cash bank
372.200
432,200
Раyments:
Trade payables 4
Rent
Machinery
Wages
Insurance
Customers (dishonoured cheque)
Loan interest aarbe
310,000
10,100
30.400
90,200
8,050
800
(450,500)
(18.300)
950
Balance on December 2018
Cash Summary
Balance on 1 January 2018
Receipts:
10,000
90,700
10,100
Cash sales
100,800
110,800
Receivables d
Payments:
Drawings
Repairs
Electricity
Cash banked
60,600
10,400
5,070
22,200
(98,270)
12,530
Balance on December 2018
The following referred to 2018
Bad debts written off
2,040
Goods withdrawn by Patsy Knight for own use
Credit note issued by Patsy Knight
Discounts allowed by trade suppliers
Discounts allowed to trade customers
Goods returned to trade suppliers
10,200
6,040
4,040
8,000
6,900
%24
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