You have been asked to help prepare the financial statements of Cee Jee trading co. for the year ended 31 December 2019. The company’s trial balance as at 31 December and additional information is shown below: Cee Jee trading co. Trial balance as at 31 December 2019 DR (£) CR (£) Capital 90,428 Drawings 19,004 Purchases 778,144 Sales 1,054,700 Salaries 66,880 Rent and rates 19,720 Light and heating 8,284 Irrecoverable (Bad) debts 3,768 Allowance for Doubtful debts 7,404 Trade receivables / Debtors 144,600 Trade payables / Creditors 68,616 Bank 5,632 Cash 668 Opening inventories 164,248 Motor vehicle at cost 14,400 Accumulated depreciation motor vehicle 4,200 Total 1,225,348 1,225,348 1. The inventories at the close of business at 31 December 2019 are valued at £198,712. 2. The rent is 12,800 per annum, payable half-yearly in advance on the 31 March and 30 September. 3. Business rates for the year ending 31 March 2020 amounting to £2,976 were paid in full in April 2019. 4. Salaries to be accrued amount to £6,024. 5. Depreciation on Motor Vehicle is to be provided using the straight-line method at 20% per annum. 6. It was agreed that further receivables amounting to £2,840 are to be written off against specific customers, and the allowance for doubtful debt is to be adjusted to 5% of the revised trade receivables figure. Required: a) Draft the statement of profit or loss for the period ended 31 December 2019. b) Draft the statement of financial position at that date
You have been asked to help prepare the financial statements of Cee Jee trading co.
for the year ended 31 December 2019. The company’s
December and additional information is shown below:
Cee Jee trading co.
Trial balance as at 31 December 2019
DR (£) CR (£)
Capital 90,428
Drawings 19,004
Purchases 778,144
Sales 1,054,700
Salaries 66,880
Rent and rates 19,720
Light and heating 8,284
Irrecoverable (
Allowance for Doubtful debts 7,404
Trade receivables / Debtors 144,600
Trade payables / Creditors 68,616
Bank 5,632
Cash 668
Opening inventories 164,248
Motor vehicle at cost 14,400
Total 1,225,348 1,225,348
1. The inventories at the close of business at 31 December 2019 are valued at
£198,712.
2. The rent is 12,800 per annum, payable half-yearly in advance on the 31
March and 30 September.
3. Business rates for the year ending 31 March 2020 amounting to £2,976 were
paid in full in April 2019.
4. Salaries to be accrued amount to £6,024.
5. Depreciation on Motor Vehicle is to be provided using the straight-line method
at 20% per annum.
6. It was agreed that further receivables amounting to £2,840 are to be written
off against specific customers, and the allowance for doubtful debt is to be
adjusted to 5% of the revised trade receivables figure.
Required:
a) Draft the statement of profit or loss for the period ended 31 December 2019.
b) Draft the statement of financial position at that date
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