Karl Ward imports and sells furniture. The following balances were extracted from his books on 30 September 2005. Sales Stock at 1 October 2004 137 900 6.900 41 200 Purchases Carriage inwards Carriage outwards Wages and salaries Insurance 9 400 1.300 34 700 1.800 Rent and rates paid 10 800 Motor vehicle expenses 4 200 General expenses 22 850 Discounts received Bank overdraft 800 700 Motor vehicles at cost Provision for depreciation of motor vehicles at 1 October 2004 Trade creditors Drawings Capital at 1 October 2004 Additional information 32 000 16 000 3 140 17.690 24 300 182 840 182 840 1. Stock at 30 September 2005 was valued at $7500. 2. During the year Karl Ward took goods costing $4300 for his own use. No entries have been made in the books. 3. Depreciation is to be charged on the motor vehicles using the diminishing (reducing) balance method at 50% per annum. 4. Wages and salaries, $6800, were owing at 30 September 2005. 5. The amount for insurance represents insurance cover for the 18 month period from 1 October 2004 to 31 March 2006. REQUIRED a) Prepare the Income Statement for the year ended 30 September 2005 b) Prepare a balance sheet as 30 September 2005, clearly showing the working capital.
Karl Ward imports and sells furniture. The following balances were extracted from his books on 30 September 2005. Sales Stock at 1 October 2004 137 900 6.900 41 200 Purchases Carriage inwards Carriage outwards Wages and salaries Insurance 9 400 1.300 34 700 1.800 Rent and rates paid 10 800 Motor vehicle expenses 4 200 General expenses 22 850 Discounts received Bank overdraft 800 700 Motor vehicles at cost Provision for depreciation of motor vehicles at 1 October 2004 Trade creditors Drawings Capital at 1 October 2004 Additional information 32 000 16 000 3 140 17.690 24 300 182 840 182 840 1. Stock at 30 September 2005 was valued at $7500. 2. During the year Karl Ward took goods costing $4300 for his own use. No entries have been made in the books. 3. Depreciation is to be charged on the motor vehicles using the diminishing (reducing) balance method at 50% per annum. 4. Wages and salaries, $6800, were owing at 30 September 2005. 5. The amount for insurance represents insurance cover for the 18 month period from 1 October 2004 to 31 March 2006. REQUIRED a) Prepare the Income Statement for the year ended 30 September 2005 b) Prepare a balance sheet as 30 September 2005, clearly showing the working capital.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Karl Ward imports and sells furniture. The following balances were extracted from his books
on 30 September 2005.
Sales
Stock at 1 October 2004
137 900
6.900
41 200
Purchases
Carriage inwards
Carriage outwards
Wages and salaries
Insurance
9 400
1.300
34 700
1.800
Rent and rates paid
10 800
Motor vehicle expenses
4 200
General expenses
22 850
Discounts received
Bank overdraft
800
700
Motor vehicles at cost
Provision for depreciation of
motor vehicles at 1 October 2004
Trade creditors
Drawings
Capital at 1 October 2004
Additional information
32 000
16 000
3 140
17.690
24 300
182 840
182 840
1. Stock at 30 September 2005 was valued at $7500.
2. During the year Karl Ward took goods costing $4300 for his own use. No entries have
been made in the books.
3.
Depreciation is to be charged on the motor vehicles using the diminishing (reducing)
balance method at 50% per annum.
4. Wages and salaries, $6800, were owing at 30 September 2005.
5.
The amount for insurance represents insurance cover for the 18 month period from
1 October 2004 to 31 March 2006.
REQUIRED
a) Prepare the Income Statement for the year ended 30 September 2005
b) Prepare a balance sheet as 30 September 2005, clearly showing the
working capital.
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