Case: Mary Finch & Co Mary Finch opened a small haberdashery store on Water Lane in...

  

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Case: Mary Finch & Co Mary Finch opened a small haberdashery store on Water Lane in Kingston on January 1, 2018.She started the business with One Million Five Hundred Thousand Dollars ($1,500,000) in the bank and Three Hundred Thousand Dollars ($300,000) in cash and a furniture & equipment valued at $450,000. Mary also had a loan from VMBS of Three Hundred Thousand Dollars ($300,000.00) and Seventy Five Thousand ($75,000) Dollars from her sister Jill. During the month of January, Mary purchased the following items: 1. 25 sheet sets @ $3,500 each 2. 20 curtains @ $2,000 each 3.30 entrance mats @ $950 each 4. 20 bed-side lamps @ $3,000 each 5. 15 standing fans @ $4,500 each 6. 20 clothes irons @ $1,900 each 7. 12 gas stoves @ $12,000 each 8. 20 frying pans @ 1,100 each 9. 20 pots @ 1,000 each 10. 8 dozen forks @ $350 per dozen The items bought in January were paid for on the following basis: Eighty percent (80%) by cheque and ten percent (20%) for cash. All items bought in January were sold by the end of January at a markup of 35% except the gas stoves which were marked up at 30%. The receipts from sales were as follows: 80% by cheque and 20% by cash and the monies lodged to the bank & cash account except 10 clothes irons which were sold on credit and at cost price to Mary's Sister Jill. Jill's bill was still outstanding at the 31 January 2018. During the month of January, Mary paid for the following items: 1. Rent for $35,000 2. Salaries and wages for $40,000 3. Electricity for $15,500 4. Water for $6,000 5. Cleaning & sanitation for $5,500 6. Local travelling for $12,000 7. Telephone expenses for $4,000 8. Miscellaneous expenses for $3,500 9. Motor vehicle expenses for $6,000 The expenses for the month of January were paid for as follows: Ninety five percent (95%) by cheque and five percent (5%) by cash excluding the electricity bill which was still outstanding at the end of January. Required: I. Prepare the opening balance sheet (as at January 1, 2018) for Mary Finch 5 marks II. Prepare the sales & purchases account for the month of January 2018 10 marks III. Prepare the Income statement for the month of January 2018 15 marks IV. Prepare the bank and cash a/cs for the month ending 31 January 2018 5 marks V. Prepare the closing balance sheet (as at 31 January 2019) for M Finch 15 marks Case: Mary Finch & Co Mary Finch opened a small haberdashery store on Water Lane in Kingston on January 1, 2018.She started the business with One Million Five Hundred Thousand Dollars ($1,500,000) in the bank and Three Hundred Thousand Dollars ($300,000) in cash and a furniture & equipment valued at $450,000. Mary also had a loan from VMBS of Three Hundred Thousand Dollars ($300,000.00) and Seventy Five Thousand ($75,000) Dollars from her sister Jill. During the month of January, Mary purchased the following items: 1. 25 sheet sets @ $3,500 each 2. 20 curtains @ $2,000 each 3.30 entrance mats @ $950 each 4. 20 bed-side lamps @ $3,000 each 5. 15 standing fans @ $4,500 each 6. 20 clothes irons @ $1,900 each 7. 12 gas stoves @ $12,000 each 8. 20 frying pans @ 1,100 each 9. 20 pots @ 1,000 each 10. 8 dozen forks @ $350 per dozen The items bought in January were paid for on the following basis: Eighty percent (80%) by cheque and ten percent (20%) for cash. All items bought in January were sold by the end of January at a markup of 35% except the gas stoves which were marked up at 30%. The receipts from sales were as follows: 80% by cheque and 20% by cash and the monies lodged to the bank & cash account except 10 clothes irons which were sold on credit and at cost price to Mary's Sister Jill. Jill's bill was still outstanding at the 31 January 2018. During the month of January, Mary paid for the following items: 1. Rent for $35,000 2. Salaries and wages for $40,000 3. Electricity for $15,500 4. Water for $6,000 5. Cleaning & sanitation for $5,500 6. Local travelling for $12,000 7. Telephone expenses for $4,000 8. Miscellaneous expenses for $3,500 9. Motor vehicle expenses for $6,000 The expenses for the month of January were paid for as follows: Ninety five percent (95%) by cheque and five percent (5%) by cash excluding the electricity bill which was still outstanding at the end of January. Required: I. Prepare the opening balance sheet (as at January 1, 2018) for Mary Finch 5 marks II. Prepare the sales & purchases account for the month of January 2018 10 marks III. Prepare the Income statement for the month of January 2018 15 marks IV. Prepare the bank and cash a/cs for the month ending 31 January 2018 5 marks V. Prepare the closing balance sheet (as at 31 January 2019) for M Finch 15 marks

Answer rating: 100% (QA)

Question 1 Assets Cash 300000 Furniture and equipment 450000 Total assets 750000 Liabilities Loan fr... View the full answer