The following are some of the accounts of Williamson Ltd.:

Some additional information was discovered:
(i) The goods debited to Mr Smith’s account (£36,000) had been sold to Mr Johnson.
(ii) Mr Smith has recently been declared bankrupt. (You can use a bad debts account to reflect this.)
(iii) The £1,300 debited to office equipment had been for a supply of stationery.
(iv) The £50,000 debited to the wages account was cash drawn by Mr Williamson.
Required:

(a) Prepare the entries necessary to reflect these facts.

(b) Show the correct accounts.

Transcribed Image Text:

Balance Sales Balance Sales Balance Cash Cash Mr Smith 28,000 36,000 Mr Johnson 93,000 29,000 Office equipment 213,000 98,000 1,300