The following are summaries of the cash book and bank accounts of J Duncan who does not keep his books using the double entry system.

You are required to:

(a) Calculate the value ofJ Duncan’‘s capital on 1 January 20X8.

(b) Prepare the Trading and Profit and Loss Accounts for the year ended 31 December 20X8.

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Bank Summary Balance on 1 January 20X8 Receipts Debtors L 8,000 26,000 Cash banked Payments 4,100 30,100 38,100 Trade creditors 18,500 Rent 1,400 Machinery 7,500 Wages 6,100 Insurance 1,450 Debtors (dishonoured cheque) 250 Loan interest 300 35,500 Balance on 31 December 20X8 2,600 Cash Summary Balance on 1 January 20X8 300 Receipts Cash sales Debtors Payments Drawings Repairs Electricity Cash banked Balance on 31 December 20X8 The following referred to 20X8 Bad debts written off Discount received Goods withdrawn by J Duncan for own use Credit note issued 14,000 400 14,400 14,700 9,500 300 750 4,100 E 400 350 300 1,200 14,650 50