The following trial balance was extracted from the books of Rodney, a sole trader, as at 31.12.X5:

The following matters have not been taken into account in the preparation of the above trial balance:
• Inventory 31.12.X5 £4,870.
• Light and heat due 31.12.X5 £120, general expenses due £80.
• Depreciation is to be provided for the year as follows:
Premises – 2% on cost Fixtures and fittings – 10% on cost Vehicles – 20% reducing balance.
• A further bad debt of £130 is to be written off and the bad debts provision is to be at 5% of debtors after the write-off.
• The loan interest of £600 has not been paid for the year.
You are required to prepare an income statement for the year ended 31.12.X5 and a balance sheet as at that date.

Transcribed Image Text:

Dr Cr Capital 1.1.X5 15,500 Drawings 4,660 Debtors and creditors 6,530 5,210 Sales 71,230 Purchases 29,760 Inventory 1.1.X5 4,340 Rates 800 Heat and light 2,650 Wages 8,250 Bad debts 230 Provision for bad debts 280 General expenses 2,340 Motor expenses 3,240 Premises at cost 30,000 Fixtures and fittings 8,000 Vehicles 12,000 Provision for depreciation 1.1.X5: Premises Fixtures and fittings Vehicles Bank 2,400 1,600 5,400 820 Loan 12,000 113,620 113,620