$4\mathrm{.}4$ Exercise

Task: Prepare the balance sheet as at $1$ January $20x1$ and post the transactions on ledger accounts while considering both of the presentation using expenses by nature and by function. Prepare also the income statements presenting both expenses by nature and by function.

The company Car Repairers, Ltd$.,$ a service company, provides repair services of cars and presents following items of assets, liabilities and equity as at $1$ January $20x1($in ths CZK$)$: Building $2000,$ related accumulated depreciation $400,$ material $130,$ van $($specially modified to be used as mobile workshop$)2500,$ related accumulated depreciation $600,$ computer $50,$ related accumulated depreciation $30,$ bank account $200,$ cash in hand $50,$ payables to employees $25,$ long term borrowing $3000,$ payables to suppliers $65,$ common capital $800,$ retained earnings $10.$ During the period $20x1$ the following transactions and events occurred $($in ths CZK$)$:

Consumption of material for repairs $25.$

Recognition of employee salaries for the period $-$ employees carrying out repairs $32,$ wage of accountant $15.$

Tax withhold from employees' wages $10,$ will be paid to government by the company.

All salaries to employees paid via bank account.

The invoice was received for advertisement carried out in newspapers $5.$

The invoice was received for consumption of electricity $20($the electricity was consumed mostly by the workshop, the electricity consumption by the office was negligible$).$

Payables to suppliers settled via bank account $65.$

Depreciation of van $10,$ depreciation of building $($where the workshop is situated$)5,$ depreciation of computer $($used mostly for accounting purposes$)3.$

Completion of a car repair, a car was handed over customer and the invoice for repair was sent $150.$