Young Traders is owned by Yvonne Young. Young Traders is not a VAT vendor and uses the perpetual inventory system. Goods are sold at a mark‐up of 50% on cost price. The following pre‐adjustment trial balance appeared in the books of Young Traders at the end of their current financial year, 30 April 2020:    Debit (R) Credit (R) Capital (1 May 2019)   1 200 000 Vehicles 550 000   Accumulated depreciation on vehicles (1 May 2019)   205 000 Fixed deposit (ABBA Bank) (12% p.a) 75 000   Inventory 149 000   Debtors Control 123 500   Allowance for credit losses (1 May 2019)   2 500 Creditors control   50 100 Bank  199 400   Sales   1 467 500 Cost of sales 914 000   Sales returns 70 000   Salaries and Wages 640 000   Stationary  84 500   Carriage on sales 23 700   Credit losses  13 500   Telephone  82 500           R2 925 100 R2 925 100 Additional information and adjustments at year‐end: 1. According to a physical stock taking, stationery on hand amounted to R4 500 and trading inventory on hand amounted to R147 000. 2. An amount of R2 500 was prepaid on carriage on sales on goods that will be delivered in March 2020. 3. A debtor, Joe Jones, is insolvent and his debt of R3 500 must be written off as irrecoverable. 4. The allowance for credit losses must be adjusted to R2 000. 5. Provide depreciation on vehicles of R55 000 for the current financial year. 6. The owner withdrew R215 000 cash over the year for his personal use. This entry still needs to be recorded. 7. An amount of R1 000 for Telephone was incorrectly debited to the Salaries and Wages account during April 2020. Correct the error. 8. Young Traders invested the fixed deposit with ABBA Bank on 1 May 2019. The fixed deposit will mature on 30 April 2021. Interest for the current year must still be provided.   Required: Q.4.1 Journalise adjustments 2, 3, 7 and 8 only. (Narrations are not required) Remember to show all workings. Q.4.2 Prepare the Statement of profit or loss and other comprehensive income of Young Traders for the year ended 30 April 2020. *Remember to show all working, and if the amount is added or subtracted. Q.4.3 Prepare the statement for changes in equity for the year ended 30 April 2020 **kindly see attached for answer format**

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Young Traders is owned by Yvonne Young. Young Traders is not a VAT vendor and uses the perpetual inventory system. Goods are sold at a mark‐up of 50% on cost price. The following pre‐adjustment trial balance appeared in the books of Young Traders at the end of their current financial year, 30 April 2020: 

  Debit (R) Credit (R)
Capital (1 May 2019)   1 200 000
Vehicles 550 000  
Accumulated depreciation on vehicles (1 May 2019)   205 000
Fixed deposit (ABBA Bank) (12% p.a) 75 000  
Inventory 149 000  
Debtors Control 123 500  
Allowance for credit losses (1 May 2019)   2 500
Creditors control   50 100
Bank  199 400  
Sales   1 467 500
Cost of sales 914 000  
Sales returns 70 000  
Salaries and Wages 640 000  
Stationary  84 500  
Carriage on sales 23 700  
Credit losses  13 500  
Telephone  82 500  
     
  R2 925 100 R2 925 100

Additional information and adjustments at year‐end:

1. According to a physical stock taking, stationery on hand amounted to R4 500 and trading inventory on hand amounted to R147 000.

2. An amount of R2 500 was prepaid on carriage on sales on goods that will be delivered in March 2020.

3. A debtor, Joe Jones, is insolvent and his debt of R3 500 must be written off as irrecoverable.

4. The allowance for credit losses must be adjusted to R2 000.

5. Provide depreciation on vehicles of R55 000 for the current financial year.

6. The owner withdrew R215 000 cash over the year for his personal use. This entry still needs to be recorded.

7. An amount of R1 000 for Telephone was incorrectly debited to the Salaries and Wages account during April 2020. Correct the error.

8. Young Traders invested the fixed deposit with ABBA Bank on 1 May 2019. The fixed deposit will mature on 30 April 2021. Interest for the current year must still be provided.

 

Required:

Q.4.1 Journalise adjustments 2, 3, 7 and 8 only.

(Narrations are not required) Remember to show all workings.

Q.4.2 Prepare the Statement of profit or loss and other comprehensive income of Young Traders for the year ended 30 April 2020.

*Remember to show all working, and if the amount is added or subtracted.

Q.4.3 Prepare the statement for changes in equity for the year ended 30 April 2020

**kindly see attached for answer format**

Q.4.3
Young Traders
Statement of changes in equity for the year ended 30 April 2020
Transcribed Image Text:Q.4.3 Young Traders Statement of changes in equity for the year ended 30 April 2020
General Journal of Young Traders for April 2020
GJ
No
Description
Debit
Credit
© The Independent Institute of Education (Pty) Ltd 2020
Page 12 of 18
20
2020
Q.4.2
Young Traders
Statement of Profit or Loss and other Comprehensive Income for the year ended 30 April 2020
R
R
Transcribed Image Text:General Journal of Young Traders for April 2020 GJ No Description Debit Credit © The Independent Institute of Education (Pty) Ltd 2020 Page 12 of 18 20 2020 Q.4.2 Young Traders Statement of Profit or Loss and other Comprehensive Income for the year ended 30 April 2020 R R
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