The information in Table 2.22 relates to entity F, which started business on 1 January 20X7 when A150,000 was paid in as capital.

(a) Convert the above information into balance sheets at the end of the two years shown. What is then revealed as the missing item?

(b) What conclusion can you draw about the performance of F during 20X7 and 20X8?

(c) Would your conclusion be affected if you knew that the entity had paid A15,000 to the owner during 20X7?

(d) Does the figure for delivery vans at 31 December 20X8 surprise you? If so, why?

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Table 2.22 Financial statistics for F 31 Dec. 20X7 31 Dec. 20X8 () () Cash at bank 19,000 36,000 Inventory of goods 32,000 29,000 Shop 135,000 135,000 Wages owed to staff 800 750 Amounts owed to supplier 26,500 21,250 Amounts owed by customers 35,000 34,000 Loans 50,000 50,000 Cash 500 2,000 Delivery vans 10,000 10,000