The following transactions have not been accounted for in the above trial balance at 31 March 2022
(a) Depreciation on both vehicles and equipment for the year has not yet been accounted for.
- Vehicles are depreciated at 15% per annum according to the straight-line method.
- Equipment is depreciated at 20% per annum on the reducing balance method.
(b) Kiddy Kraft Traders received an invoice for water and electricity for an amount of R2 500 relating to March 2021, which has not been paid yet.
(c) R15 000 was received from Fancy Nancy for inventory to be delivered in April 2022.
(d) PJ Mask, a debtor of Kiddy Kraft Traders, went into liquidation. His account of R2 500 was written off as a bad debt. No specific allowance for credit losses was previously recognized.
(e) It is the policy of Kiddy Kraft to adjust their allowance for credit losses to 20% of outstanding debtors at yearend. The adjustment is yet to be processed.

(f) Kiddy Kraft Traders has an insurance policy that it pays annually in advance. The insurance premiums for January 2022 to December 2022 were paid during the month of January. The insurance premiums are R1 500 per month.
There were no drawings made by the owner during the year.
Assume a net profit for the year of R79 075 after all adjustments have been processed.
REQUIRED:
Using the information above preparing the adjusting journal entries.

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The following balances were taken from the accounting records of Kiddy Krafts Traders for the year ended 31 March 2022 Kiddy Kraft (Pty) Ltd Capital (1 April 2021) Mortgage: ABSA Bank Land and buildings at cost Vehicles at cost Equipment at cost Accumulated depreciation vehicles (1 April 2021) Accumulated depreciation Equipment (1 April 2021) Fixed deposit: Investment Bank Inventory Debtors control account Allowance for credit losses Bank (favourable) Creditor's control Accrued expenses VAT payable Cash float Petty cash Sales Discounts: sales Cost of sales Rental income Interest on loan: SBSA Telephone & internet Water and electricity Salaries and wages Insurance Advertising Depreciation Debit 715 500 115 500 45 500 105 500 65 500 35 500 108 200 17 000 18 000 65 750 700 900 28 250 32 500 35 000 85 150 31 500 45 500 2 250 750 Credit 525 000 415 500 40 500 24 500 19 000 54 000 32 500 20 500 1063 750 55 500 2 250 750 The following balances were taken from the accounting records of Kiddy Krafts Traders for the year ended 31 March 2022 Kiddy Kraft (Pty) Ltd Capital (1 April 2021) Mortgage: ABSA Bank Land and buildings at cost Vehicles at cost Equipment at cost Accumulated depreciation vehicles (1 April 2021) Accumulated depreciation Equipment (1 April 2021) Fixed deposit: Investment Bank Inventory Debtors control account Allowance for credit losses Bank (favourable) Creditor's control Accrued expenses VAT payable Cash float Petty cash Sales Discounts: sales Cost of sales Rental income Interest on loan: SBSA Telephone & internet Water and electricity Salaries and wages Insurance Advertising Depreciation Debit 715 500 115 500 45 500 105 500 65 500 35 500 108 200 17 000 18 000 65 750 700 900 28 250 32 500 35 000 85 150 31 500 45 500 2 250 750 Credit 525 000 415 500 40 500 24 500 19 000 54 000 32 500 20 500 1063 750 55 500 2 250 750

Answer rating: 100% (QA)

a Depreciation on both vehicles and equipment for the year has not yet been accounted for Vehicles a... View the full answer