You are given the following simplified statement of financial position of the Stonefolk Company as at 31 March year 4.

a The following transactions took place in April year 4. Show how each would affect the statement of financial position. (Each transaction must affect two or more figures, and the statement of financial position must continue to balance.)
i A building, which had cost £80,000, was sold for £100,000, which was immediately received in cash.
ii Inventories, which had cost £30,000, were sold to Mr Spliff for £80,000. Mr Spliff agreed to pay for the goods by the end of May year 4.
iii The company paid £40,000 of the amount that it owed to creditors, which is shown on the statement of financial position as ‘payables’.
b Show how the statement of financial position would appear after these transactions have been recorded.

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Non-current assets 158,000 Current assets Inventories (at cost) 110,000 Receivables 120,000 Cash 20,000 250,000 Total assets 408,000 Current liabilities Trade payables 120,000 Equity Share capital 250,000 Retained earnings 38,000 288,000 Total equity and liabilities 408,000