You are to draw up a trading and profit and loss account for the year ended 31 December 20X8, and a balance sheet as at that date from the following trial balance and details of T Howe Ltd:

(i) Stock at 31 December 20X8 £52,360.
(ji) Rates owing £280; Office expenses owing £190.
(iii) Dividend of 10 per cent proposed.
(iv) Transfers to reserves: General £1,000; Foreign exchange £800.
(v) Depreciation on cost: Buildings 5 per cent; Equipment 20 per cent.

Transcribed Image Text:

Dr Cr Bank Debtors 6,723 18,910 Creditors 12,304 Stock at 31 December 20X7 40,360 Buildings at cost 100,000 Equipment at cost 45,000 Profit and loss account as at 31.12.20X7 15,286 General reserve 8,000 Foreign exchange reserve 4,200 Authorised and issued share capital 100,000 Purchases Sales 72,360 135,486 Carriage inwards 1,570 Carriage outwards 1,390 Salaries 18,310 Rates and occupancy expenses 4,235 Office expenses 3,022 Sundry expenses 1,896 Provisions for depreciation at 31.12.20X7: Buildings 32,000 Equipment 16,000 Directors' remuneration 9,500 323,276 323,276 Notes at 31 December 20X8: