Question $4$

Below is the pre$-$adjustment trial balance of Radars Traders as at $30$ September $2024.$ The

$($Marks: $45)$

business makes use of the perpetual inventory system.

RADARS TRADERS

PRE$-$ADJUSTMENT TRIAL BALANCE AS AT $30$ SEPTEMBER $2024$

Debit $($R$)$

Capital

Credit $($R$)$

Drawings

$230000$

Loan: ABB Bank

$35400$

Vehicles

$355000$

Accumulated depreciation: vehicles

$580000$

Equipment

$125000$

Accumulated depreciation: Equipment

$354000$

Debtors Control

$134000$

Creditors Control

$126300$

Allowance for credit losses

$91800$

$6500$

Bank

Inventory

$15450$

Sales

$90900$

Sales Returns

$4700500$

Cost of sales

$32300$

$3616555$

Advertising

Consumable stores

$32400$

$30800$

Courier fees

Credit losses

$1900$

$12000$

Electricity and water

Fuel

$39100$

$34000$

Insurance

Interest on loan

$32400$

$3095$

Printing and stationery

Rates and taxes

$19500$

$30000$

Repairs and maintenance

Salaries and Wages

$20600$

$565000$

Service income

Telephone

$25000$

$5683250$

$27000$

$5683250$

Additional information:

$1.$ The owner took trading inventory with a cost price of R$2000$ for his own personal

use. This has not been adjusted for yet.

$2.$ According to the physical stock count at year end, the following was on hand:

$$ Trading inventory: R$86700$

$$ Consumable stores: R$3560$

$3.$A new vehicle was purchased on $1$ July $2024$ at a cost of R$250000.$ This has been

correctly recorded in the accounting records. There were no other movements in non$-$current assets during the year.

$4.$ Depreciation rates are as follows:

$$ Equipment: $20\%$ per annum on the straight$-$line basis.

$$ Vehicles: $25\%$ per annum on the diminishing balance method

Depreciation on non$-$current assets on hand at year$-$end must still be accounted

for.

$5.$ The September electricity invoice for R$3100$ was only received on $5$ October and

must still be accounted for.

$6.$ Management reviewed the Debtors Age Analysis at year$-$end and has decided the

Allowance for credit losses should be R$5300.$

$7.$ A service income invoice, issued on $25$ September $2024,$ was omitted in error from the September Debtors journal. The value of the invoice was R$5800.$

$8.$ Interest on Loan is calculated at $10\%$ per annum. The loan was negotiated and

received on $1$ August $2024.$ The first capital repayment of R$10400$ was made on

$1$ September $2024.$ Further monthly repayments of R$10400$ are due from

$1$ October $2024($use $366$ days for interest calculations$).$

$9.$ The owner made a capital contribution of R$10000$ cash on $15$ August $2024.$ The

sales account was credited in error with this amount and must still be corrected.

Ignore VAT

Required:

Q$\mathrm{.}4\mathrm{.}1$ Prepare the general journal entry for adjustment eight above. Journal narrations

are not required. Round to the nearest rand.

Q$\mathrm{.}4\mathrm{.}2$ Prepare the statement of Profit and loss for Radar Traders for the year ended

$30$ September $2024.$ Show all your workings. Round all answers to the nearest

rand.

Q$\mathrm{.}4\mathrm{.}3$ Prepare the Statement of changes in equity for Radar Traders for the year ended

$30$ September $2024.$