Mr. Kamau started his business on 1 January 2016 with £35,000 in a bank account. Unfortunately he did not keep proper books of account. He is forced to submit a calculation of profit for the year ended 31 December 2019 to the Income Tax Department. He ascertains that at 31 December 2016 he had stock valued at cost £6,200, a van which had cost £6,400 during the year and which had depreciated during the year by £1,600, debtors of £15,200, expenses prepaid of £310, a bank balance of £33,490, a cash balance £270, trade creditors £7,100, and expenses owing £640. His drawings were: cash £400 per week for 50 weeks, cheque payments £870. Required: Prepare a statements to show the profit or loss for the year ended December 31, 2019.
Mr. Kamau started his business on 1 January 2016 with £35,000 in a bank account. Unfortunately he did not keep proper books of account. He is forced to submit a calculation of profit for the year ended 31 December 2019 to the Income Tax Department. He ascertains that at 31 December 2016 he had stock valued at cost £6,200, a van which had cost £6,400 during the year and which had depreciated during the year by £1,600, debtors of £15,200, expenses prepaid of £310, a bank balance of £33,490, a cash balance £270, trade creditors £7,100, and expenses owing £640. His drawings were: cash £400 per week for 50 weeks, cheque payments £870. Required: Prepare a statements to show the profit or loss for the year ended December 31, 2019.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
![Mr. Kamau started his business on 1 January 2016 with £35,000 in a bank account.
Unfortunately he did not keep proper books of account. He is forced to submit a calculation of
profit for the year ended 31 December 2019 to the Income Tax Department. He ascertains that at
31 December 2016 he had stock valued at cost £6,200, a van which had cost £6,400 during the
year and which had depreciated during the year by £1,600, debtors of £15,200, expenses prepaid
of £310, a bank balance of £33,490, a cash balance £270, trade creditors £7,100, and expenses
owing £640. His drawings were: cash £400 per week for 50 weeks, cheque payments £870.
Required:
Prepare a statements to show the profit or loss for the year ended December 31, 2019.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F52166bb9-2353-4ddb-8a1a-c12dcebbe0b0%2F35b23029-88bd-46ae-b4ad-11ba75785dd7%2Frkdb02q_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Mr. Kamau started his business on 1 January 2016 with £35,000 in a bank account.
Unfortunately he did not keep proper books of account. He is forced to submit a calculation of
profit for the year ended 31 December 2019 to the Income Tax Department. He ascertains that at
31 December 2016 he had stock valued at cost £6,200, a van which had cost £6,400 during the
year and which had depreciated during the year by £1,600, debtors of £15,200, expenses prepaid
of £310, a bank balance of £33,490, a cash balance £270, trade creditors £7,100, and expenses
owing £640. His drawings were: cash £400 per week for 50 weeks, cheque payments £870.
Required:
Prepare a statements to show the profit or loss for the year ended December 31, 2019.
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