The following are the unadjusted ledger balances of Teresa Limited for the year ended 31 December 2022:
Question:
The following are the unadjusted ledger balances of Teresa Limited for the year ended 31 December 2022:
$
Ordinary Share Capital | 1,000,000 |
Sales | 1,116,000 |
Trade payables | 75,760 |
Returns Outwards | 1,120 |
Purchases | 192,000 |
Returns Inwards | 884 |
Carriage outwards | 896 |
Carriage inwards | 840 |
Rental expense | 140,000 |
Insurance expense | 77,600 |
Marketing and selling expense | 171,280 |
Salaries | 160,000 |
Cash at Bank | 110,580 |
Opening Inventory | 58,800 |
Trade Receivables | 120,000 |
Office Equipment at cost | 1,000,000 |
Accumulated Depreciation (1st January 2022: Office Equipment) 100,000 Furniture and Fittings at cost 260,000 Additional information needed for year-end adjustments, are as follows:
a) | There is an amount of $4,850 included in the insurance expense, which is meant for January 2023. |
b) | The closing inventory as of 31 December 2022 amounts to $35,000. |
c) | The company's management decided to write off $12,000 as irrecoverable debts for the financial period. |
d) | There is an amount of $28,000 rental expenses outstanding as of 31 December 2022. |
e) | The company provides depreciation of 10% depreciation on the cost of office equipment. |
f) | The company depreciates furniture and fittings at 20% using the straight-line method. |
Required:
a)Prepare an Income Statement for the year ended 31 December 2022.
b)Prepare a Statement of Financial Position as at that date.
International Financial Reporting and Analysis
ISBN: 978-1408075012
5th edition
Authors: David Alexander, Anne Britton, Ann Jorissen