1. You have extracted the following Trial Balance from the books of Asempa Ye Tia at 31^st

January 2008.

Capital 12,000,000

Bank charges 29,650

IRS (Withheld Income Tax) 33,150

Creditors 4,825,250

Debtors 3,795,800

Discounts Allowed 115,000

Discounts Received 199,000

Drawings 200,000

General Expenses 300,000

Insurance 750,000

Loan Account 2,500,000

Motor Vehicle (Cost 6,000,000) 4,800,000

Motor Vehicle Running Exp. 370,000

Other Employment Costs 77,500

Purchases 23,010,150

Rent 50,000

Returns Inwards Account 112,200

Returns Outwards Account 59,900

Salaries 620,000

Sales 28,110,000

Shop Furniture, Fixtures and Fittings

(Cost 1,750,000) 1,500,000

Stock 1Jan 2008 250,000

Cash at Bank 11,630,000

Cash at Hand 117,000

47,727,300 47,727,300

You are to prepare a Trading and Profit and Loss Account for the month of January 2008, and a Balance Sheet as at that date, taking into consideration the following additional information:

i. Somu Yie Enterprises for 850,000 worth of goods that had not been received by the Purchases recorded during the month includes an invoice, dated 3^rd February from close of business on 31^st January.

ii. The proprietress proposes to purchase a Benz C200 Saloon car at the end of December 2008. She has been assured by the prospective seller that the vehicle will cost her not more than 8,750,000 and to meet this cost, she has been paying into the business a weekly sum of 210,500 from her private earnings. Five such payments by her during the month have been erroneously treated as cash sales in the books.

iii. Insurance paid cover the six months, Jan to June 2008.

iv. Repair work done by a local carpenter on shop fittings has not been paid, the bill thereof for 45,800 having been submitted to the business.

v. The proprietress had drawn 55,000 on an I.O.U on 30^th Jan, to meet some domestic expenses; this is included in the balance shown as cash in Hand.

vi. Motor Vehicle and Shop Furniture, Fixtures, etc. are to be depreciated at 20 per cent and 15 per cent per annum respectively on cost.

vii. Value of stock at 31st Jan. 2008, has been correctly ascertained to be 820,000.