08:17 P19 - 2 The following trial balance was extracted from the accounting records of Oaktree CC at 31 December 20 xx6, a corporation that carries on business as a garden nursery. On its incorporation, the members agreed to share the ownership and profits of the close corporation equally, and that their respective contributions to the corporation would be equal. OAKTREE CC TRIAL BALANCE AT 31 DECEMBER 20X6 Members' contributions Undrawn profit Short term loan from member: Laurel Short-term loan from member: Birch Land and buildings: cost Land and buildings: accumulated depreciation Equipment: cost Equipment: accumulated depreciation Inventory: 1 January 20X6 Accounts receivable Bank Accounts payable Sales Purchases Administration expense Advertising expense
P19 - 2 The following trial balance was extracted from the accounting records of Oaktree CC at 31 December 20X6, a corporation that carries on business as a garden nursery. On its incorporation, the members agreed to share the ownership and profits of the close corporation equally, and that their respective contributions to the corporation would be equal. On 1 July 206 the members each withdrew C15000 from the corporation, the effect thereof being recorded against their loan accounts. There have been no other movements on the loan accounts during the year ended 31 December 206. The following information must be taken into account in the preparation of the financial statements: 1. Interest at the rate of 6% per annum is to be provided on the opening balances on the members' loan accounts. 2. Inventory at 31 December 206 amounted to C26 000. 279 Questions, Exercises and Problems in Financial Accounting 3. Members' salaries for the year are as follows: Laurel C20 000 Birch C15000 4. Equipment is depreciated at the rate of 10% per annum on cost and the building is depreciated at 5% per annum on cost. The building cost C50 000. There were no fixed asset acquisitions or disposals during the year. 5. The current tax rate is 30%. 6. The members authorised a distribution of C30000 for the year ended 31D 206, payable on 15 January 207. All distributions are subject to a dividen 20% You are required to: a. Prepare the statement of profit or loss of Oaktree CC for the year ended 31D 206. b. Prepare the statement of changes in equity of Oaktree CC for the period ended 31 December 20X6. c. Prepare the statement of financial position of Oaktree CC at 31 December 206. d. Prepare the members' net investment statement of Oaktree CC for the period ended 31 December 206. P19 - 3 Mary and George formed a close corporlati 0 f 2 ed Dispo Products CC in October 20X3. The close corporation sells Dispo products (disposable tableware such as plates and cutlery) which are imported from Japan. Dispo Products CC operates from premises that it rents in Sandown, but it is the intention of Mary and George for the close corporation to build offices and a warehouse within the P19 - 2 The following trial balance was extracted from the accounting records of Oaktree CC at 31 December 20X6, a corporation that carries on business as a garden nursery. On its incorporation, the members agreed to share the ownership and profits of the close corporation equally, and that their respective contributions to the corporation would be equal. On 1 July 206 the members each withdrew C15000 from the corporation, the effect thereof being recorded against their loan accounts. There have been no other movements on the loan accounts during the year ended 31 December 206. The following information must be taken into account in the preparation of the financial statements: 1. Interest at the rate of 6% per annum is to be provided on the opening balances on the members' loan accounts. 2. Inventory at 31 December 206 amounted to C26 000. 279 Questions, Exercises and Problems in Financial Accounting 3. Members' salaries for the year are as follows: Laurel C20 000 Birch C15000 4. Equipment is depreciated at the rate of 10% per annum on cost and the building is depreciated at 5% per annum on cost. The building cost C50 000. There were no fixed asset acquisitions or disposals during the year. 5. The current tax rate is 30%. 6. The members authorised a distribution of C30000 for the year ended 31D 206, payable on 15 January 207. All distributions are subject to a dividen 20% You are required to: a. Prepare the statement of profit or loss of Oaktree CC for the year ended 31D 206. b. Prepare the statement of changes in equity of Oaktree CC for the period ended 31 December 20X6. c. Prepare the statement of financial position of Oaktree CC at 31 December 206. d. Prepare the members' net investment statement of Oaktree CC for the period ended 31 December 206. P19 - 3 Mary and George formed a close corporlati 0 f 2 ed Dispo Products CC in October 20X3. The close corporation sells Dispo products (disposable tableware such as plates and cutlery) which are imported from Japan. Dispo Products CC operates from premises that it rents in Sandown, but it is the intention of Mary and George for the close corporation to build offices and a warehouse within the
