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: (SEE attatched 7.JPG) Additional information and adjustments at year‐end: According to a physical stock taking, stationery on hand amounted to R4 500 and trading inventory on hand amounted to R147 000. An amount of R2 500 was prepaid on carriage on sales on goods that will be delivered in May 2020. A debtor, Joe Jones, is insolvent and his debt of R3 500 must be written off as irrecoverable. The allowance for credit losses must be adjusted to R2 000. Provide depreciation on vehicles of R55 000 for the current financial year. The owner withdrew R215 000 cash over the year for his personal use. This entry still needs to be recorded. An amount of R1 000 for Telephone was incorrectly debited to the Salaries and Wages account during April 2020. Correct the error. 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. Prepare the Statement of profit or loss and other comprehensive income of Young Traders for the year ended 30 April 2020. Show all your working, and if the amount is added or subtracted. (SEE attacthed 10.JPG) for correct answer forma

Name: Young Traders is owned by Yvonne Young. Young Traders is not a VAT ven
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Description: 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

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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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:

(SEE attatched 7.JPG)

Additional information and adjustments at year‐end:

According to a physical stock taking, stationery on hand amounted to R4 500 and trading inventory on hand amounted to R147 000.
An amount of R2 500 was prepaid on carriage on sales on goods that will be delivered in May 2020.
A debtor, Joe Jones, is insolvent and his debt of R3 500 must be written off as irrecoverable.
The allowance for credit losses must be adjusted to R2 000.
Provide depreciation on vehicles of R55 000 for the current financial year.
The owner withdrew R215 000 cash over the year for his personal use. This entry still needs to be recorded.
An amount of R1 000 for Telephone was incorrectly debited to the Salaries and Wages account during April 2020. Correct the error.
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.

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

Show all your working, and if the amount is added or subtracted.

(SEE attacthed 10.JPG) for correct answer forma

Young Traders
Statement of Profit or Loss and other Comprehensive Income for the year ended 30 April 2020
R

Pre-adjustment Trial Balance of Young Traders as at 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
Stationery
84 500
Carriage on Sales
23 700
Credit Losses
13 500
Telephone
82 500
R2 925 100
R2 925 100

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