Mvunga is a Sole trader. The following trial Balance has been extracted from his books as at 31 December 2021. K K Motor vehicle at cost 110,000 Accumulated depreciation on motor vehicles - 32,580 Inventory at 1 January 2021 37,508 - Cash at Bank 48,134 - Trade receivables 362,200 - Trade payables - 194,278 Page 6 of 8 Capital - 137,562 Sales - 890,776 Sales returns 14,080 - Purchases 556,200 - Purchases returns - 30,700 Discount received - 5,254 Discount allowed 5,800 - Wages 90,852 - Motor expenses 6,552 - Administration expenses 20,002 - Selling and distribution cost 3,822 - Rent and rates 36,000 - 1,291,150 1,291,150 ADDITIONAL INFORMATION 1. Inventory on hand at 31 December 2021 was K29,500. 2. One vehicle included in the trial balance above with original cost of K10,000 was sold for K6,000 during the year. The carrying value of the sold vehicle was K5,000. This transaction has not been recorded in Mvunga’s accounting records. The remaining vehicles are to be depreciated at 10% using the reducing balance method. 3. Administration expenses owing at 31 December 2021 was K238.
Required:
i. Prepare a statement of Profit or Loss for the year ended 31 December 2021.  
ii. Prepare a statement of Financial Position as at 31 December 2021.

Answer rating: 100% (QA)

mvunga trading profit loss ac for the period ending 31Dec 2021 k k sales 890776 less sales returns 1... View the full answer