This question also relates to extended trial balances (see Exhibit 28.2) From the following trial balance of John Brown, store owner, prepare a trading account and profit and loss account for the year ended 31 December 20X7, and a balance sheet as at that date, taking into consideration the adjustments shown below:

(i) Closing stock at 31 December 20X7 £120,000.

(ii) Accrued wages £5,000.

(iii) Rates prepaid £500.

(iv) The provision for doubtful debts to be increased to 10 per cent of debtors.

(v) Telephone account outstanding £220.

(vi) Depreciate shop fittings at 10 per cent per annum, and van at 20 per cent per annum, on cost.

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Trial Balance as at 31 December 20X7 Sales Purchases Sales returns Purchases returns Opening stock at 1 January 20X7 Provision for doubtful debts Wages and salaries Rates Telephone Shop fittings at cost Van at cost Debtors and creditors Bad debts Capital Bank balance Drawings Dr £ 350,000 5,000 100,000 30,000 6,000 1,000 40,000 30,000 9,800 200 3,000 18,000 593,000 Cr £ 400,000 6,200 800 7,000 179,000 593,000