5. Alan started a salon on 1 January 2013 The following is the trial balance of...

 

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5. Alan started a salon on 1 January 2013 The following is the trial balance of his business as at 31 December 2013. Capital 1 January 2013 Drawings Motor car (cost $1,800) Cash in hand Cost of new hair dryer Equipment (cost $1,000) Freehold premises Advertising Cash at bank Motor car expenses Rates Telephone Revenue from hairdressing Sundry expenses Additional Information: Dr S 3,760 1,320 40 120 600 6,000 230 5,400 480 140 110 1,200 19,400 Cr $ 9,000 10,400 19,400 (1) Rates prepaid 31 December 2013 $30. (ii) One-fifth of motor car expenses including depreciation for the year is to be regarded as private use. (iii) Provide for cleaning costs $50. (iv) Depreciate all equipment on hand at 31 December 2013 by 10% of cost. (v) Motor car is to be depreciated by 20% on reduced balance. REQUIRED (a) Prepare the following final accounts for Alan: (i) Profit & loss account for the year ended 31 December 2013. (ii) Balance sheet as at 31 December 2013. (b) State and explain why there is some common items are not found under Current Assets. 5. Alan started a salon on 1 January 2013 The following is the trial balance of his business as at 31 December 2013. Capital 1 January 2013 Drawings Motor car (cost $1,800) Cash in hand Cost of new hair dryer Equipment (cost $1,000) Freehold premises Advertising Cash at bank Motor car expenses Rates Telephone Revenue from hairdressing Sundry expenses Additional Information: Dr S 3,760 1,320 40 120 600 6,000 230 5,400 480 140 110 1,200 19,400 Cr $ 9,000 10,400 19,400 (1) Rates prepaid 31 December 2013 $30. (ii) One-fifth of motor car expenses including depreciation for the year is to be regarded as private use. (iii) Provide for cleaning costs $50. (iv) Depreciate all equipment on hand at 31 December 2013 by 10% of cost. (v) Motor car is to be depreciated by 20% on reduced balance. REQUIRED (a) Prepare the following final accounts for Alan: (i) Profit & loss account for the year ended 31 December 2013. (ii) Balance sheet as at 31 December 2013. (b) State and explain why there is some common items are not found under Current Assets.

Answer rating: 100% (QA)

a i PROFIT AND LOSS ACCOUNT Hairdressing revenue 10400 Less Operating expenses Depreciation expenseM... View the full answer