The Following Trial Balance Was Extracted From the Books of TUMAINI Ltd at 31 December 2015

Share capital authorized and issued:

80,000 ordinary shares of £1 each 80,000
Freehold premises at cost 59,000
Motor vans
Balance 1 January 2015 at cost 15,000
Additions less sale proceeds 650
Provisions for depreciation of motor vans to 31 December 2014- 6,750
Stock in trade 31 December 2014 13,930
Balance at bank 6,615
Provision for doubtful debts 31 December 2014 275
Trade debtors and creditors 12,395 11,380
Directors’ remuneration 4,000
Wages and salaries 13,127
Motor and delivery expenses 3,258
Rates 700
Purchases 108,440
Sales 142,770
Legal expenses 644
General expenses 5,846
Profit and loss account: balance at 31 December 2014 £ 2,430

TOTAL= 243,605 243,605
You are given the following information.

i. Stock in trade, 31 December 2015, £14,600.
ii. Rates paid in advance, 31 December 2015, £140.
iii. Debts of £1,075 to be written off and the provision to be increased to £350.
iv. On 1 January 2015, a motor van which had cost £680, was sold for £125.
v. Depreciation provided for this van up to 31 December 2014 was £475.
vi. Provide for depreciation of motor vans (including additions) at 20% of cost.
vii. The balance on legal expenses account included £380 in connection with the purchase of one of the freehold properties.
viii. The directors have decided to recommend a dividend of 5%.

Required:
With particular emphasis on presentation, prepare a trading and profit and loss account for the year 2015, and a balance sheet at 31 December 2015,

Answer rating: 100% (QA)

Answer Trading account for the year ended 31st december2015 Particular Amount Particular Amount To o... View the full answer