Jean Smith, who retails wooden ornaments, has been so busy since she commenced business on 1 April 19_5 that she has neglected to keep adequate accounting records. Jean’s opening capital consisted of her life savings of £15 000 which she used to open a business bank account. The transactions in this bank account during the year ended 31 March 19_6 are summarized from the bank account at the top of the next page.

According to the bank account, the balance in hand on 31 March 19_6 was £4,090 in Jean Smith’s favour.
Whilst the intention was to bank all takings intact, it now transpires that, in addition to cash drawings, the following payments were made out of takings before bankings:

On 31 March 19_6, takings of £640 awaited banking: this was done on 1 April 19_6. It has been discovered that amounts paid into the bank of £340 on 29 March 19_6 were not credited to Jean’s bank account until 2 April 19_6 and a cheque of £120, drawn on 28 March 19_6 for purchases was not paid until 10 April 19_6. The normal rate of gross profit on the goods sold by Jean Smith is 50% on sales. However, during the year a purchase of ornamental gold fish costing £600 proved to be unpopular with customers and therefore the entire stock bought had to be sold at cost price.
Interest at the rate of 5% per annum is payable on each anniversary of the loan from John Peacock on 1 January 19_6.
Depreciation is to be provided on the van on the straight line basis: it is estimated that the van will be disposed of after five years’ use for £100.
The stock of goods for resale at 31 March 19_6 has been valued at cost at £1 900.
Creditors for purchases at 31 March 19_6 amounted to £880 and electricity charges accrued due to that date were £180.
Trade debtors at 31 March 19_6 totalled £2 300.
Required:
Prepare a trading and profit and loss account for the year ended 31 March 19_6 and a balance sheet as at that date.

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Receipts: Loan from John Peacock, uncle Takings Payments: Purchases of goods for resale 10 000 42 000 26 400 Electricity for period to 31 December 19_5 Rent of premises for 15 months to 30 June 19_6 Rates of premises for the year ended 31 March 19_6 Wages of assistants Purchase of van, 1 October 19_5 Purchase of holiday caravan for Jean Smith's private use Van licence and insurance, payments covering a year 760 3.500 1 200 14 700 7 600 8 500 250