You have agreed to take over the role of bookkeeper for the AB sports and social club. The summarized statement of financial position on 31.12.X1 as prepared by the previous bookkeeper contained the following items.

The bank account summary for the year to 31.12.X2 contained the following items.

You discover that the subscriptions due figure as at 31.12.X1 was arrived at as follows.

Corresponding figures at 31.12.X2 are:

 

Subscriptions due for more than 12 months should be written off with effect from 1.1.X2.

Two-thirds of the sportswear purchases made in 20X2 had been added to inventories of new sportswear in the figures given in the list of assets above, and one-third had been added directly to the inventory of used sportswear for hire.
Half of the resulting ‘new sportswear for sale at cost’ at 31.12.X2 is actually over two years old. You decide, with effect from 31.12.X2, to transfer these older items into the inventory of used sportswear at a valuation of 25 per cent of their original cost. No cash balances are held at 31.12.X1 or 31.12.X2. The equipment for the grounds person is to be depreciated at 10 per cent per annum, on cost.

Required
Prepare the income and expenditure account and statement of financial position for the AB sportsclub for 20X2, in a form suitable for circulation to members. The information given should be as complete and informative as possible within the limits of the information given to you. All workings must be submitted.

Transcribed Image Text:

Assets Heating oil for clubhouse Bar and café inventories New sportswear, for sale, at cost Used sportswear, for hire, at valuation Equipment for groundsperson - cost Subscriptions due Bank-current account - deposit account Accumulated fund Payables- bar and café goods - sportswear - depreciation £ 5,000 (3,500) £ 1,000 7,000 3,000 750 1,500 200 1,000 10,000 23,150 1,000 300