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Please can you solve the below and provide an explanation. Thank you

Please can you solve the below and provide an explanation. Thank you

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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Please can you solve the below and provide an explanation. Thank you 

11 Frank and Joe partners in a business sharing profit and loss in the ratio 2:1 Their trial balance as at August 31, 1998 was as follows $ $ 22,350 Creditors Debtors Fixtures Prov. for depn on fixtures Building 10% Mortgage (2005-2008) Capital - Frank - Joe Current account - Frank Joe Drawings Frank - Joe Motor vehicle Sales Office salaries Office expenses Mortgage interest Discount allowed Carriage outwards Purchases Stock at September 1, 1997 Bank Cash Commission received 25,000 22,000 83,500 7,500 8,000 10,000 50,000 25,000 9,400 8,000 3,240 2,360 245,500 70,000 12,000 581,500 The following additional information is also available : 1. Stock at December 31, 2000 is $85,000 2. Interest on capital is to be paid at 5% 3. Interest on drawings is to be charged at 5% 6,600 80,000 80,000 40,000 3,500 295, 500 41,050 12,500 581,500 4. Provide for depreciation of fixtures 10% using the reducing balance method, and motor vehicle at 10% using the straight line method 5. Frank is to be paid a salary of $10,000 Required: Prepare set of final accounts for the year
Transcribed Image Text:11 Frank and Joe partners in a business sharing profit and loss in the ratio 2:1 Their trial balance as at August 31, 1998 was as follows $ $ 22,350 Creditors Debtors Fixtures Prov. for depn on fixtures Building 10% Mortgage (2005-2008) Capital - Frank - Joe Current account - Frank Joe Drawings Frank - Joe Motor vehicle Sales Office salaries Office expenses Mortgage interest Discount allowed Carriage outwards Purchases Stock at September 1, 1997 Bank Cash Commission received 25,000 22,000 83,500 7,500 8,000 10,000 50,000 25,000 9,400 8,000 3,240 2,360 245,500 70,000 12,000 581,500 The following additional information is also available : 1. Stock at December 31, 2000 is $85,000 2. Interest on capital is to be paid at 5% 3. Interest on drawings is to be charged at 5% 6,600 80,000 80,000 40,000 3,500 295, 500 41,050 12,500 581,500 4. Provide for depreciation of fixtures 10% using the reducing balance method, and motor vehicle at 10% using the straight line method 5. Frank is to be paid a salary of $10,000 Required: Prepare set of final accounts for the year
Expert Solution
Step 1

Income Statement

An income statement's function is to tell users, lenders, and stakeholders about the company's financial results during the fiscal year. The income statement is a summary of the firm's profits and losses for the entire fiscal year in the context of company finance.

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