1 4 TSN Traders is a wholesaler and is based in Polokwane. The company has a 28 February financial year end. TSN Traders is NOT a registered VAT vendor. During the financial year ended 29 February 2020, you are presented with the following trial balance: TSN TRADERS Trial balance at 29 February 2020 Note DEBIT-R CREDIT-R Land & Buildings 500 000 Sales 660 000 Financial investments 240 000 Furniture 80 000 Stationery (SOFP) (1/3/2019) 20 000 Trade Receivables 40 000 Bank 52 000 Capital (29/2/2020) 600 000 Retained earnings (1/3/2019) 268 000 Purchases 315 000 Sales returns 16 000 Rent Income 54 000 Salaries and wages 192 000 Sundry Expenses 36 000 Interest income 18 000 Insurance expense 9 000 Inventories (1/3/2019) 7 100 000 TOTALS 1 600 000 1 600 000 Additional information 1. The interest income relates to the financial investment. This investment was made for the full year ended 29 February 2020, with interest being receivable monthly. The interest income was only received for nine (9) months for the year ended 29 February 2020. 2. Stationery on hand on 29 February 2020 amounted to R6 000. 3. A debtor Mr. Unstable was declared insolvent on 1 February 2020. Mr. Unstable owed TSN Traders R8 000. This transaction is yet to be recorded. 4. The owner of TSN Traders, Mr. Siyakha, contributed an additional amount of capital during the year ended 29 February 2020 worth R10 000. This transaction was correctly recorded in the books of TSN Traders. 5 1 6 5. Included in the rent income is an amount of R10 800. The R10 800 is rent income for three months i.e. March April and May 2020. 6. On 29 February 2020, TSN Traders owed R1 000 on their insurance premium. 7. The salaries and wages erroneously included an amount of R4 000 which was an amount owed to TSN Traders by a receivable. 8. Inventory on hand on 29 February 2020 amounted to R95 000. MARKS [16] REQUIRED: a) Prepare the following general journal entries in the books of TSN Traders for the year ended 29 February 2020 to account for the additional information above: Note 1 Note 2 Note 3 Note 5 Note 6 Note: - Show ALL calculations. Dates and narrations ARE REQUIRED. b) Prepare the statement of profit or loss for TSN Traders for the year ended 29 February 2020, after taking the above information into account. - Show ALL calculations. c) Prepare the statement of changes in equity for TSN Traders for the year ended 29 February 2020, after taking the above information into account. The total column is not required. - Show ALL calculations. d) With reference to the definitions of the elements contained in the conceptual framework for financial reporting, explain why you chose to debit the element in transaction (1) above. - A mark for presentation, layout and clear communication will be awarded [19] [5] [10]