Helga's trial balance, drawn up at the end of the first year of trading, is shown in Table 2.7.

REQUIRED:

a) Identify the entries in Helga's trial balance that represent revenue income and revenue expenses.

b) Prepare the income statement for Helga for the year ended 30 November 2012.

c) There are two entries on the trial balance that Helga does not understand:
trade receivables and trade payables. Explain briefly how these accounts have arisen.

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Table 2.7 Helga Trial balance as at 30 November 2012 Debit Credit Capital 50,000 Loan (interest at 5%) 10,000 Sales 235,700 Wages 25,200 Purchases 182,400 Rent and rates 15,900 Motor expenses 3,600 Sundry expenses 2,000 Interest on loan 500 Light and heat 1,800 Office expenses 3,100 Drawings 12,000 Motor vehicles 25,000 Fixtures and fittings 18,000 Trade receivables 11,800 Trade payables 10,500 Bank account 4,900 306,200 306,200