Answer ALL questions.

$[100$ MARKS$]$

QUESTION $1$

$(20$ Marks$)$

REQUIRED

Prepare the Statement of Financial Position as at $29$ February $2024.$

INFORMATION

The following information was obtained from the accounting records of Kingsway Suppliers on $29$ February $2024,$ the end of the financial year.

KINGSWAY SUPPLIERS

PRE$-$ADJUSTMENT TRIAL BALANCE AS AT $29$ FEBRUARY $2024$

Debit $($R$)$

Credit $($R$)$

Balance Sheet accounts section

Capital

$798850$

Drawings

$150000$

Vehicles at cost

$990000$

Equipment at cost

$460000$

Accumulated depreciation on vehicles

$190000$

Accumulated depreciation on equipment

$138000$

Fixed deposit: Fin Bank $(12\%$ p$.$a$.)$

$40000$

Trading inventory

$312500$

Debtors control

$166500$

Provision for bad debts

$4500$

Bank

$241000$

Petty cash

$2500$

Creditors control

$78500$

Long$-$term loan: Fin Bank $(18\%$ p$.$a$.)$

$350000$

Nominal accounts section

Sales

$3600000$

Cost of sales

$1550000$

Sales returns

$45000$

Salaries and wages

$700000$

Discount received

$3000$

Discount allowed

$2000$

Rent expense

$180000$

Motor expenses

$58500$

Advertising

$48000$

Telephone

$42000$

Electricity and water

$52500$

Bank charges

$24000$

Insurance

$31000$

Interest on mortgage loan

$47250$

Interest on fixed deposit

$2400$

Consumable stores

$22500$

$5165250$

$5165250$

Adjustments and additional information

$1.$

Inventories, cost price R$6000,$ were donated to a local charity on $26$ February $2024.$ No entry was made for this.

$2.$

According to stocktaking at the end of the financial year, the following were on hand:

Trading inventory

R$296500$

Consumable stores

R$1500.$

$3.$

Interest of R$15750$ is due on the long$-$term loan. Interest is not capitalised. Repayments to be made during the next financial period are expected to reduce the loan balance by R$100000.$

$4.$

Provide for interest not yet received on the fixed deposit. The investment in fixed deposit was made on $28$ February $2023$ and it matures on $30$ June $2024.$ Interest is not capitalised.

$5.$

In terms of the rental agreement the rent expense for the first ten months of the financial year was R$16000$ per month. Thereafter, the monthly rental increased by R$4000.$

$6.$

The advertising total includes a payment of R$3600$ for an advertisement that was due to appear in March $2024.$

$7.$

The telephone account for February $2024$ was due to be paid on $02$ March $2024,$ R$3900.$

$8.$

The bank statement from Fin Bank reflected bank charges that must still be recorded, R$2150.$

$9.$

The insurance total includes a payment made for the proprietor$$s personal life insurance, R$3500.$

$10.$

An account of R$4500$ was received from Hooper Tyres to replace the tyres of one of the vehicles. No entry was made for this. Note: Do not treat this as accrued expenses.

$11.$

The account of a debtor, P$.$ Thomas, must be written off as irrecoverable, R$6500.$

$12.$

The provision for bad debts must be increased by R$3500.$

$13.$

Provide for depreciation as follows:

$13\mathrm{.}1$

On vehicles at $15\%$ per annum on cost$.$

$13\mathrm{.}2$

On equipment at $20\%$ per annum using the diminishing balance method.

$14.$

The net profit, after taking all the information provided above into account, amounted to R$528450.$