Mr Chibombamilimo is a sole trader; he has not done any accounting but has kept track of

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Question:

Mr Chibombamilimo is a sole trader; he has not done any accounting but has kept track of his expenses. He has approached you to do his final accounts. The following are the transactions that took place in year 2010.

1. On 1/1/2010 he introduced capital in the business of K300, 000 by depositing a cheque in the business account.

2. On 1/1/2010 a delivery van worth K100, 000 was purchased by cheque.

3. On 3/1/2010 goods worthK10, 000 were purchased on credit from H.Gere.

4. On 10/1/2010 sold goods worth K5, 000 to Kalala.

5. On 2/1/2010 sold goods to Chongo on credit amounting to K2.000.

6. On 3/2/2010 sold goods to Kabwe on credit worth K100, 000.

7. On 3/2/2010 K1, 700 cash was transferred into the bank account.

8. On 5/2/2010 bought goods on credit worth K30, 000 from Chama.

9. On 15/2/2010 sold goods on credit to Sitwala for K17, 000.

10. On 17/2/2010 shop rentals worth K700 were paid.

11. On 20/2/2010 paid the shop keeper, Hamusankwa a K400 cheque.

12. On 3/3/2010 bought shop premises by cheque for K20, 000.

13. On 4/3/2010 discovered that the goods for H.Gere worth K2, 000 were defective and they were therefore retained.

14. On 7/3/2010 paid H.Gere a cheque amounting to K2, 000.

15. On 19/4/2010 Kalala returned goods worth K750 claiming they were not good enough.

16. On 27/3/2010 sold goods worth K3, 000 on credit to Kamwi.

17. On 19/4/2010 paid Chama a cheque amounting to K10, 000.

18. On 25/4/2010 paid salaries amounting to K500 by cheque.

19. On 26/5/2010 the van was repaired at a cost of K500 on credit at Car doctor repairs.

20. On 27/5/2010 the shop premises was insured for K500 with Mac Insurance by cheque.

21. On 2/6/2010 received a loan payable after ten years from Mid bank plc amounting to K400, 000 by cheque.

22. On 24/12/2010 arranged an end of year party costing K1, 000. The sole supplier was Chalwe who supplied everything on credit.

23. On 24/12/2010 Mr Chibombamilimo drew K10, 000 for personal use.

24. On 25/12/2010 sold goods to Temwani by cash for K120, 000. Note, 1 closing stock was valued at K4, 000 at cost, but could be sold for K6, 000.

You are required To enter the above transactions in the relevant accounts, prepare the trial balance, the trading and profit and loss account and the balance sheet.