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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

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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: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
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
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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