gs $18,440 Carriage Inwards $11,830 Discount Allowed $2,306 Discount Received $1,750 Purchases $135,680 Return Inwards $5,624 Rents, rates & insurance
gs $18,440 Carriage Inwards $11,830 Discount Allowed $2,306 Discount Received $1,750 Purchases $135,680 Return Inwards $5,624 Rents, rates & insurance
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
The following list of balances is from the ledger of Mr. Carty as at February 28, 2018.
Carriage Outwards $4,562
Drawings $18,440
Carriage Inwards $11,830
Discount Allowed $2,306
Discount Received $1,750
Purchases $135,680
Return Inwards $5,624
Rents, rates & insurance $25,973
Heating & Lighting $11,010
Postage, stationery & telephone $2,410
Debtor $ 24,500
Fixtures & Fittings- at cost $120,740
Provision for
Depreciation $12,074
Advertising $5,980
Salaries & wages $38,521
Cash $534
Return Outwards $13,407
Provision for doubtful debt $512
Bank $4,440
Capital $83,887
Sales $259,870
Creditor $19,840
Stock as at March 1, 2017, $15,654
You are required to:
- Prepare a
trial balance from the information provided - Using the following additional information:
- Stock at the close of business was valued at $17,750
- Insurances have been prepaid by $1,120
- Heating and lighting are accrued by $1,360
- The provision for doubtful debt is to be adjusted so that it is 3% of debtors
- Prepaid rates $5,435
- Prepare an Income Statement for Mr. Carty for the year ended Feb. 28, 2018
- Prepare the statement of financial position as at Feb. 28, 2018
- Explain the importance of the Income Statement and Statement of Financial position to Mr. Carty.
- From the information gathered in the Income Statement and Statement of Financial Position, provide Mr. Carty with an analysis of his business performance.
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