A B C E G 1 a) The following trial balance was extracted from the books of M Jackson on 30 April 20X7. 2 From it, the notelbelow it, prepare the Statement of Financial Comprehensive Income for the year ending 30 April 20X7 and 3 Statement of Financial Position as at that date. 4. 5 DR CR 6 Sales 18614 7 Purchases 11570 8 Inventory 1st May 20X6 9 Carriage outwards 10 Carriage inwards 11 Returns inwards 3776 326 234 440 12 Returns outwards 355 13 Salaries and wages 14 Motor expenses 2447 664 15 Rent 576 16 Sundry expenses 17 Motor vehicles 18 Fixtures and fittings 1202 3400 600 19 Trade receivables 4577 20 Trade payables 3045 21 Cash at bank 3876 22 Cash in hand 120 23 Drawings 24 Capital 25 26 27 Note: 28 Closing inventory amounted to 4,000. Depreciation is to be charged at rates of 10% on cost 29 for Fixtures and Fittings and 25% on cost for Motor Vehicles. Bad debts of 800 are to be 2050 13844 35858 35858 30 written off 31 32 b) Michael has indicated that he thinks that the trade receivables that have been written off 33 will pay eventually. He is also querying why adjustments are made in the financial statements 34 for bad debts and depreciation. Write a short note to him, making appropriate references 35 to accounting concepts, outlining why these adjustments are made. 36 37 L A B C E G 1 a) The following trial balance was extracted from the books of M Jackson on 30 April 20X7. 2 From it, the notelbelow it, prepare the Statement of Financial Comprehensive Income for the year ending 30 April 20X7 and 3 Statement of Financial Position as at that date. 4. 5 DR CR 6 Sales 18614 7 Purchases 11570 8 Inventory 1st May 20X6 9 Carriage outwards 10 Carriage inwards 11 Returns inwards 3776 326 234 440 12 Returns outwards 355 13 Salaries and wages 14 Motor expenses 2447 664 15 Rent 576 16 Sundry expenses 17 Motor vehicles 18 Fixtures and fittings 1202 3400 600 19 Trade receivables 4577 20 Trade payables 3045 21 Cash at bank 3876 22 Cash in hand 120 23 Drawings 24 Capital 25 26 27 Note: 28 Closing inventory amounted to 4,000. Depreciation is to be charged at rates of 10% on cost 29 for Fixtures and Fittings and 25% on cost for Motor Vehicles. Bad debts of 800 are to be 2050 13844 35858 35858 30 written off 31 32 b) Michael has indicated that he thinks that the trade receivables that have been written off 33 will pay eventually. He is also querying why adjustments are made in the financial statements 34 for bad debts and depreciation. Write a short note to him, making appropriate references 35 to accounting concepts, outlining why these adjustments are made. 36 37 L