4. From the following trial balance of John Brown, bar owner, prepare an income statement for the year ended 31 December 2006, and a balance sheet as at that date, taking into consideration the adjustments shown below: Dr. (RM) Cr. (RM) Sales and Purchases 350,000 400,000 Sales and Purchases Returns 5,000 6,200 Stock, 1 January 2006 100,000 Provision for doubtful debts 800 Wages and salaries 30,000 Rates 6,000 Telephone bill 1,000 Bar fittings at cost 40,000 Van at cost 30,000 Debtors and creditors 9,800 7,000 Bad debts 200 Capital 179,000 Bank balance 3,000 Drawings 18,000 593,000 593,000 (i) Closing stock at 31 December 2006 RM120,000. (ii) Accrued wages RM5,000 and telephone bill outstanding RM220. (iii) Rates prepaid RM500. (iv) An additional RM300 is to be written off as bad debts and provision for doubtful debts to be provided at 10% of debtors