The trial balance of Mumbai Traders at 31 December was as follows: Sh 000 Sh 000 Inventory
Question:
The trial balance of Mumbai Traders at 31 December was as follows:
Sh’ 000 Sh’ 000
Inventory at 1 January 600
Purchases 5,020
Cash at bank 922
Land at cost 6,200
Insurance 864
Light and heat 1,226
Printing and stationery 731
Professional fees 860
Allowance for doubtful debts 10
Accounts receivable 812
Accounts payable 768
Wages 2,196
Bad debts expense 21
Capital at 1 January 10,726
Sales 9,642
Office furniture 1,040
Accumulated depreciation on furniture 220
Rent 874 21,366 21,366
The following information is applicable.
(a) Inventory on 31 December is Sh 850,000.
(b) The cumulative allowance for doubtful debts is to be increased to Sh 15,000.
(c) There is rent accrued of Sh 300,000.
(d) Insurance of Sh 125,000 had been paid in advance.
(e) Depreciation on office furniture is to be provided at 5 percent on cost.
You are required to:
(a) Prepare an income statement for the year ended 31 December,
(b) Prepare a statement of changes in capital for the year ended 31 December,
(c) Prepare a balance sheet as of 31 December.
Accounting Principles
ISBN: 978-0470533475
9th Edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso