The following trial balance was extracted from the books of Lilylilac Enterprise as at 31 May 2020: Trial balance as at 31 May 2020 Debit (RM) Credit (RM)Capital344,250Drawings 3,100Warehouse rent 6,200Heat and light 1,800Insurance 2,400Mortgage loan, secured on freehold land100,000Freehold land 370,000Utilities 6,700Postage450Stationery680Wages and salaries 14,500Purchases 132,000Purchase returns5,300Trade Payables51,000Sales265,000Sales returns 3,600Trade Receivables 87,000Inventories as at 1 June 2019 12,600Discounts received2,400Discounts allowed 3,560Bad debts 2,700Provision of doubtful debt at 1 June 20191,250Motor expenses710Motor vehicles, at cost 85,000Accumulated depreciation - motor vehicle17,000Furniture, at cost 96,000Accumulated depreciation - furniture9,600Office equipment, at cost 62,000Accumulated depreciation - office equipment15,200Bank overdraft106,000Cash in hand 8,000Loan interest 18,000917,000 917,000 Additional information: The inventories counted on 31 May 2020 were RM13,500. Motor vehicles are depreciated on a straight-line basis, assuming a five-year life and zero residual Office equipment is depreciated on a 25% per annum using reducing balance Furniture is depreciated on a 10% per annum on cost. The warehouse rent of RM3,000 per year is payable in advance on 1 December each A staff bonus of RM2,700 relating to the financial year ended 31 May 2020 paid by cheque has not been included in the Staff claims for motor expenses of RM250 in respect of 31 May 2020 paid by cash have not been included in the Interest outstanding on the mortgage at 31 May 2020 was RM12,000. Interest receivable on overdue Trade Receivables as 31 May 2020 was RM4,000. Import duties related to purchases of RM3,000 was paid in cash but it was not recorded in the The company disposed of a furniture that was purchases on 1 July 2015 at a cost of RM9,000 for RM2,000 cash on 31 May The policy of the company is to charge full year depreciation in the year of acquisition and no depreciation in the year of disposal. ) Stella, a customer who owed RM5,200 has been declared The amount needs to be written off and the provision for doubtful debts needs to be adjusted to 5% of trade receivables as at year end. Required: Prepare the adjusting journal entries that must be made prior to the preparation of the financial statements for the financial year ended 31 May(Note: Narratives are not required) ( The statement of profit or loss for Lilylilac Enterprise for the year ended 31 May The statement of financial position for Lilylilac Enterprise as at 31 May

The question is based on the concept of Final Accounts.

The following trial balance was extracted from the books of Lilylilac Enterprise as at 31 May 2020: Trial balance as at 31 May 2020 Debit (RM) Credit (RM) Capital 344,250 Drawings 3, 100 Warehouse rent 6, 200 Heat and light 1, 800 Insurance 2, 400 Mortgage loan, secured on freehold land 100,000 Freehold land 370, 000 Utilities 6, 700 Postage 450 Stationery 680 Wages and salaries 14, 500 Purchases 132, 000 Purchase returns 5,300 Trade Payables 51,000 Sales 265,000 Sales returns 3, 600 Trade Receivables 87, 000 Inventories as at 1 June 2019 12, 600 Discounts received 2,400 Discounts allowed 3, 560 Bad debts 2, 700 Provision of doubtful debt at 1 June 2019 1,250 Motor expenses 710 Motor vehicles, at cost 85, 000 Accumulated depreciation - motor vehicle 17,000 Furniture, at cost 96, 000 Accumulated depreciation - furniture 9,600 Office equipment, at cost 62, 000 Accumulated depreciation - office equipment 15,200 Bank overdraft 106,000 Cash in hand 8, 000 Loan interest 18, 000 917, 000 917,000 Additional information: The inventories counted on 31 May 2020 were RM13,500. Motor vehicles are depreciated on a straight-line basis, assuming a five-year life and zero residual Office equipment is depreciated on a 25% per annum using reducing balance

The following trial balance was extracted from the books of Lilylilac Enterprise as at 31 May 2020: Trial balance as at 31 May 2020 Debit (RM) Credit (RM) Capital 344,250 Drawings 3, 100 Warehouse rent 6, 200 Heat and light 1, 800 Insurance 2, 400 Mortgage loan, secured on freehold land 100,000 Freehold land 370, 000 Utilities 6, 700 Postage 450 Stationery 680 Wages and salaries 14, 500 Purchases 132, 000 Purchase returns 5,300 Trade Payables 51,000 Sales 265,000 Sales returns 3, 600 Trade Receivables 87, 000 Inventories as at 1 June 2019 12, 600 Discounts received 2,400 Discounts allowed 3, 560 Bad debts 2, 700 Provision of doubtful debt at 1 June 2019 1,250 Motor expenses 710 Motor vehicles, at cost 85, 000 Accumulated depreciation - motor vehicle 17,000 Furniture, at cost 96, 000 Accumulated depreciation - furniture 9,600 Office equipment, at cost 62, 000 Accumulated depreciation - office equipment 15,200 Bank overdraft 106,000 Cash in hand 8, 000 Loan interest 18, 000 917, 000 917,000 Additional information: The inventories counted on 31 May 2020 were RM13,500. Motor vehicles are depreciated on a straight-line basis, assuming a five-year life and zero residual Office equipment is depreciated on a 25% per annum using reducing balance

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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Question

The following trial balance was extracted from the books of Lilylilac Enterprise as at 31 May 2020:

Trial balance as at 31 May 2020

Debit (RM) Credit (RM)
Capital	344,250
Drawings 3,	100
Warehouse rent 6,	200
Heat and light 1,	800
Insurance 2,	400
Mortgage loan, secured on freehold land	100,000
Freehold land 370,	000
Utilities 6,	700
Postage	450
Stationery	680
Wages and salaries 14,	500
Purchases 132,	000
Purchase returns	5,300
Trade Payables	51,000
Sales	265,000
Sales returns 3,	600
Trade Receivables 87,	000
Inventories as at 1 June 2019 12,	600
Discounts received	2,400
Discounts allowed 3,	560
Bad debts 2,	700
Provision of doubtful debt at 1 June 2019	1,250
Motor expenses	710
Motor vehicles, at cost 85,	000
Accumulated depreciation - motor vehicle	17,000
Furniture, at cost 96,	000
Accumulated depreciation - furniture	9,600
Office equipment, at cost 62,	000
Accumulated depreciation - office equipment	15,200
Bank overdraft	106,000
Cash in hand 8,	000
Loan interest 18,	000
917,	000 917,000

Additional information:

The inventories counted on 31 May 2020 were RM13,500.

Motor vehicles are depreciated on a straight-line basis, assuming a five-year life and zero residual

Office equipment is depreciated on a 25% per annum using reducing balance

Furniture is depreciated on a 10% per annum on cost.

The warehouse rent of RM3,000 per year is payable in advance on 1 December each

A staff bonus of RM2,700 relating to the financial year ended 31 May 2020 paid by cheque has not been included in the

Staff claims for motor expenses of RM250 in respect of 31 May 2020 paid by cash have not been included in the

Interest outstanding on the mortgage at 31 May 2020 was RM12,000.

Interest receivable on overdue Trade Receivables as 31 May 2020 was RM4,000.

Import duties related to purchases of RM3,000 was paid in cash but it was not recorded in the

The company disposed of a furniture that was purchases on 1 July 2015 at a cost of RM9,000 for RM2,000 cash on 31 May The policy of the company is to charge full year depreciation in the year of acquisition and no depreciation in the year of disposal.

) Stella, a customer who owed RM5,200 has been declared The amount needs to be written off and the provision for doubtful debts needs to be adjusted to 5% of trade receivables as at year end.