The year-end Trial Balance of Global Ltd is set out. Further information: (a) Cost of closing inventory

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The year-end Trial Balance of Global Ltd is set out. Further information:

(a) Cost of closing inventory was £644,000.

(b) The Trial Balance failed to balance because a folio in the Purchases Day Book had been added as £226,000 instead of £248,000. The difference has been placed in a Suspense account.

(c) Furniture and vehicles are to be depreciated for the year at 5% and 20% per annum, using the straight-line method for furniture and reducing balance method for vehicles.

(d) Directors wish to write off a trade debt of £8,000 and to adjust the allowance to cover 5% of the remaining receivables.

(e) Rent is payable at £10,000 per month.

(f) £44,000 salaries and £3,000 advertising remain unpaid as at the year-end.

(g) Tax on current year’s profit is estimated at £138,000.

(h) A dividend of 3p per share, declared by the directors, is yet to be accounted for.


Required: 

Prepare, for internal use, the Statement of income for the year ended 31 December 2011 and the Statement of financial position as at that date.

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Related Book For  answer-question

Financial Accounting An Introduction

ISBN: 9780273737650

2nd Edition

Authors: Mr Barry Elliott, Mr Augustine Benedict

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