Antonius is the owner of Vespasian Enterprises, a linen shop that has been trading for the...
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Antonius is the owner of Vespasian Enterprises, a linen shop that has been trading for the past 5 years. Vespasian Enterprises uses the periodic inventory system to record their inventory. The entity is NOT a registered VAT vendor. According to the accounting policies of the entity, depreciation must be provided for at 20% on motor vehicles, using the reducing balance method, and 15% on equipment, using the straight- line method. At the end of each year, the provision for credit losses must be adjusted to 1% of total outstanding debtors. The pre-adjustment trial balance on 31 December 2019 was extracted from the records of Vespasian Enterprises. TRIAL BALANCE AS AT 31 DECEMBER 2019 DR CR Capital Drawings Land and buildings Motor vehicles Accumulated depreciation: Motor vehicles Equipment Accumulated depreciation: Equipment Debtors control Allowance for credit losses Creditors control Trading inventory (1 January 2019) Bank Sales 366 400 5 500 353 000 135 000 35 000 56 000 6 000 34 500 50 44 500 45 000 53 500 460 000 Rent received 33 500 Commission income 14 000 Sales returns 13 500 Purchases 166 550 Purchases returns Credit losses Electricity Insurance Printing and stationery Salaries and wages Telephone 35 000 3 000 17 350 15 550 35 500 50 000 10 500 994 450 994 450 Additional information (not yet considered): 1. Inventory on hand on 31 December 2019 amounts to R60 000. 2. Rental income due for December 2019, R2 390, has not been received yet. 3. An amount of R1 500, being the insurance for January 2020, is included in the insurance expense. 4. Telephone for December 2019, R3 450, has not been paid yet. 5. Commission for January 2020, R3 500, was banked during December 2019. 6. The profit AFTER the above adjustments amounts to R213 795. Required: Prepare the statement of financial position of Vespasian Enterprises as at 31 December 2019. Antonius is the owner of Vespasian Enterprises, a linen shop that has been trading for the past 5 years. Vespasian Enterprises uses the periodic inventory system to record their inventory. The entity is NOT a registered VAT vendor. According to the accounting policies of the entity, depreciation must be provided for at 20% on motor vehicles, using the reducing balance method, and 15% on equipment, using the straight- line method. At the end of each year, the provision for credit losses must be adjusted to 1% of total outstanding debtors. The pre-adjustment trial balance on 31 December 2019 was extracted from the records of Vespasian Enterprises. TRIAL BALANCE AS AT 31 DECEMBER 2019 DR CR Capital Drawings Land and buildings Motor vehicles Accumulated depreciation: Motor vehicles Equipment Accumulated depreciation: Equipment Debtors control Allowance for credit losses Creditors control Trading inventory (1 January 2019) Bank Sales 366 400 5 500 353 000 135 000 35 000 56 000 6 000 34 500 50 44 500 45 000 53 500 460 000 Rent received 33 500 Commission income 14 000 Sales returns 13 500 Purchases 166 550 Purchases returns Credit losses Electricity Insurance Printing and stationery Salaries and wages Telephone 35 000 3 000 17 350 15 550 35 500 50 000 10 500 994 450 994 450 Additional information (not yet considered): 1. Inventory on hand on 31 December 2019 amounts to R60 000. 2. Rental income due for December 2019, R2 390, has not been received yet. 3. An amount of R1 500, being the insurance for January 2020, is included in the insurance expense. 4. Telephone for December 2019, R3 450, has not been paid yet. 5. Commission for January 2020, R3 500, was banked during December 2019. 6. The profit AFTER the above adjustments amounts to R213 795. Required: Prepare the statement of financial position of Vespasian Enterprises as at 31 December 2019.
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Related Book For
Intermediate Accounting
ISBN: 978-0078025839
9th edition
Authors: J. David Spiceland, James Sepe , Mark Nelson , Wayne Thomas
Posted Date:
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