The following list of Balances was extracted from the books of BG Trading Limited at 30...

  

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The following list of Balances was extracted from the books of BG Trading Limited at 30 June 2006 after the closing entries had been passed. R Trade creditors 137 883 Stock 699 715 Provision for income tax (balance due) 2 004 Provision for bad debts 20 997 16 % mortgage debentures 400 000 Land and buildings at cost 600 000 Debentures interest accrued 16 000 Goodwill at cost 300 000 General reserve 198 000 Furniture at cost less depreciation 100 000 Debtors 396 400 Ordinary share capital 1 500 000 Retained income 163 715 Additional information: 1. The cash book balance had been omitted 2. A dividend of 10% has been declared but no entries have yet been made. 3. The authorized capital of the company is R100 000 ordinary shares of R2 each. The directors have unrestricted power to issue the unissued shares as they deem fit before 31 March 2007. 4. Stock at 30 June 2006 has been valued at the lower of cost or net realizable value. The basis was consistent with that used in previous years. 5. The furniture on hand at 30 June 2006 was purchased on 1 July 2004. Depreciation is calculated at 10 % per annum according to the fixed instalment method. 6. The debentures were issued in units of R100 and are redeemable at the premium of 5% on 30 June 2006. 7. Land and buildings consist of office and shop premises on site number 178, Evertal, purchased on 3 August 1996 for R600 000. 8. Debtors include an amount of R16 400 lent to a director. The loan was made on 17 June 2006 and no repayments have yet been made. The loan was for the purchase of a car to be used mainly for the company's business, and was properly authorized. Required Prepare the balance sheet confirming to generally accepted accounting practice and the provisions of the Companies Act. Ignore comparative figures and the funds statement. The following list of Balances was extracted from the books of BG Trading Limited at 30 June 2006 after the closing entries had been passed. R Trade creditors 137 883 Stock 699 715 Provision for income tax (balance due) 2 004 Provision for bad debts 20 997 16 % mortgage debentures 400 000 Land and buildings at cost 600 000 Debentures interest accrued 16 000 Goodwill at cost 300 000 General reserve 198 000 Furniture at cost less depreciation 100 000 Debtors 396 400 Ordinary share capital 1 500 000 Retained income 163 715 Additional information: 1. The cash book balance had been omitted 2. A dividend of 10% has been declared but no entries have yet been made. 3. The authorized capital of the company is R100 000 ordinary shares of R2 each. The directors have unrestricted power to issue the unissued shares as they deem fit before 31 March 2007. 4. Stock at 30 June 2006 has been valued at the lower of cost or net realizable value. The basis was consistent with that used in previous years. 5. The furniture on hand at 30 June 2006 was purchased on 1 July 2004. Depreciation is calculated at 10 % per annum according to the fixed instalment method. 6. The debentures were issued in units of R100 and are redeemable at the premium of 5% on 30 June 2006. 7. Land and buildings consist of office and shop premises on site number 178, Evertal, purchased on 3 August 1996 for R600 000. 8. Debtors include an amount of R16 400 lent to a director. The loan was made on 17 June 2006 and no repayments have yet been made. The loan was for the purchase of a car to be used mainly for the company's business, and was properly authorized. Required Prepare the balance sheet confirming to generally accepted accounting practice and the provisions of the Companies Act. Ignore comparative figures and the funds statement.

Answer rating: 100% (QA)

BG Trading Limited Blance Sheet 30 June 2006 Particultars Amount Assets Current assets Ca... View the full answer