Juggling Jim's Showcase is a circus shop run by your cousin, Jim. He is at the...

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Juggling Jim's Showcase is a circus shop run by your cousin, Jim. He is at the end of his first year in business and he has heard that you have been studying accounting. Jim once took an accounting course himself, but he failed his exams and so he asks you to help him produce some accounts. He has employed a clerk to write up his books which were kept correctly. Jim then prepared the following trial balance which he cannot get to balance. He asks you to help him see where he has gone wrong. Jim's Trial Balance Premises Accumulate depreciation on premises Fixtures and fittings Accumulated depreciation on fixtures and fittings Vans Accumulated depreciation on vans Inventories at end of year Closing trade receivables Closing trade payables Bank balance (overdraft) Capital Profit for the year Loan € 150,000 40,000 4,000 20,000 2,000 12,000 10,000 2,000 240,000 € 3,000 48,000 50,000 39,000 160,000 300,000 You ascertain the following further information: A van costing €6,000 with accumulated depreciation of €600 was sold for €4,500 cash just before the year-end. This transaction has not yet been reflected in the company's books. Required (a) Produce two corrected trial balances for Jim, one before and one after incorporating adjustment for the note. Show workings using T accounts. Juggling Jim's Showcase is a circus shop run by your cousin, Jim. He is at the end of his first year in business and he has heard that you have been studying accounting. Jim once took an accounting course himself, but he failed his exams and so he asks you to help him produce some accounts. He has employed a clerk to write up his books which were kept correctly. Jim then prepared the following trial balance which he cannot get to balance. He asks you to help him see where he has gone wrong. Jim's Trial Balance Premises Accumulate depreciation on premises Fixtures and fittings Accumulated depreciation on fixtures and fittings Vans Accumulated depreciation on vans Inventories at end of year Closing trade receivables Closing trade payables Bank balance (overdraft) Capital Profit for the year Loan € 150,000 40,000 4,000 20,000 2,000 12,000 10,000 2,000 240,000 € 3,000 48,000 50,000 39,000 160,000 300,000 You ascertain the following further information: A van costing €6,000 with accumulated depreciation of €600 was sold for €4,500 cash just before the year-end. This transaction has not yet been reflected in the company's books. Required (a) Produce two corrected trial balances for Jim, one before and one after incorporating adjustment for the note. Show workings using T accounts.

Answer rating: 100% (QA)

Corrected Trial Balance before the Adjustment Account Title Debit Credit Premises 150000 Accum... View the full answer