Leonard's trial balance at 30 June 1999 is as follows:

Further information:
1. The balance on the equipment at cost account consists of £34,600 brought forward from the previous year, plus new equipment bought for £7,500 on 1 May 1999, 2. Equipment which cost £5,000 on 17 November 1995 was sold for £2,000 on 11 April 1999. The only entries made so far in relation to this disposal are to debit cash at bank and credit the disposal of equipment account with the sale proceeds of £2,000.
3. Equipment is depreciated at 30% per annum on the reducing-balance basis, with a full year's charge in the year of acquisition and none in the year of disposal.
4. The cost of Leonard's closing stock on 30 June 1999 was £6,210.
5. The only accrued expense on 30 June 1999 was heating and lighting £120.
6. Rent of £500 had been prepaid on 30 June 1999.
N. NWagNes and salaries include Leonard's salary of £1,500 per month.
Required:

(a) Write up ledger accounts for equipment, provision for depreciation of equipment and disposal of equipment (no other ledger accounts are required).

(b) Prepare Leonard's trading and profit and loss account for the year to 30 June 1999 and a balance sheet as at that date.

Transcribed Image Text:

Capital as at 1 July 1998 26,444 Equipment at cost 42,100 Provision for dep'n of equipment at 1 July 1998 26,765 Disposal of equipment 2,000 Trade debtors and creditors 7,666 4,549 Cash at bank 1,875 Stock as at 1 July 1998 5,870 Purchases 31,756 Sales 79,220 Carriage inwards 680 Carriage outwards 420 Rent of business premises 6,500 Heating and lighting 1,340 Wages and salaries 37,500 Sundry expenses 1,146 Discounts allowed and received 2,450 325 139,303 139,303