Malcolm’s trial balance as at 30 June 20X2 was as follows: £ £ Capital account as at 31 July 20X1...

Malcolm’s trial balance as at 30 June 20X2 was as follows:

	£	£
Capital account as at 31 July 20X1		29,000
Creditors		21,000
Debtors	22,650
Cost of goods sold	144,000
Drawings	32,100
Sales		243,000
Stock	36,000
Vehicles	21,000
Wages expense	14,250
Sundry expenses	3,000
Rent expense	13,500
Insurance expense	2,000
Cash at bank	4,500
	293,000	293,000

The following information is relevant:

1. Wages payable but unpaid at 30 June 20X2 amounted to £750.

2. Rent accrued and unpaid at 30 June 20X2 amounted to £3,000.

3. The figure of insurance expense includes a prepayment at 30 June 20X2 of £1,000.

4. The vehicles are to be depreciated at the rate of 25 per cent per annum. As the vehicles were purchased at the beginning of the year, no depreciation has yet been provided. A full year’s depreciation is now to be provided.

Prepare Malcolm’s profit and loss account for the year ended on 30 June 20X2 and his balance sheet as at that date.

Answer rating: 100% (QA)

Malcolms profit and ... View the full answer