Here are the balances from the statement of financial position of Stix Stores, a retail merchant, as at 31 March 20x0 and 20x1:

Drawings for the years ended 31 March 20x0 and 20x1 were R4 000 and R6 000 respectively.

You are required to:

1. From the information calculate the net profit or loss for the year ended 31 March 20x1.

2. Adjust the profit or loss calculated in Question 1 by taking the following into account:

a. The omission of accrued expenses of R2 000 on 31 March 20x1.

b. The omission of accrued rental income of R500 on 31 March 20x0.

c. The omission of R1 000 prepaid expenses on 31 March 20x1.

d. The misallocation to purchases of fittings purchased on 30 September 20x0 of R800 as an expense (fixtures and fittings are depreciated at the rate of 10% per annum on cost).

e. The omission of R600 prepaid expenses on 31 March 20x0. If an adjusting entry is not required, note your opinion and give reasons for it.

Transcribed Image Text:

Fixtures and fittings Inventory Accounts receivable Cash at bank Accounts payable Bank overdraft Capital: L. Tshabalala 20x0 11 000 00 6 000 00 4 000 00 5 000 00 14 000 00 0 00 00 12 000 20x1 14 000 00 7 000 00 15 000 00 0 00 9 000 00 1 000 00 26 000 00