Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Alpha Plc Date: 31 March 2024 Trial Balance: Description Dr (000) Cr (000) Bank overdraft 30 Called-up share capital (ordinary shares of 1 each)

Alpha Plc
 Date: 31 March 2024

Trial Balance:

Description

Dr (£000)

Cr (£000)

Bank overdraft


30

Called-up share capital (ordinary shares of £1 each)


1,500

Accounts payable


60

Accounts receivable

60


Non-current assets: at cost

320


Accumulated depreciation (at 1 April 2023)


140

Marketing expenses

120


Office expenses

150


Retained profits (at 1 April 2023)


220

Production expenses

2,400


Purchases (net of VAT)

3,800


Sales (amounts invoiced, net of VAT)


7,500

Inventory (at 1 April 2023)

140


Trade accounts payable


170

Trade accounts receivable

2,500





Total

9,090

9,090

Additional Information:

  1. Inventory at 31 March 2024 was valued at £180,000.
  2. At 31 March 2024, £25,000 was owing for office expenses, and £18,000 had been paid in advance for marketing expenses.
  3. A customer had gone into liquidation owing the company £310,000; the company does not expect to recover any of this debt.
  4. The company decides to set up an allowance for doubtful debts amounting to 5% of the outstanding trade accounts receivable as at the end of each financial year.
  5. Depreciation is to be charged on the non-current assets at a rate of 20% on cost; it is to be apportioned as follows:
    • Marketing: 25%
    • Office: 15%
    • Production: 60%

Note:
 There were no acquisitions or disposals of non-current assets during the year to 31 March 2024.

Required:
 Prepare Alpha Plc’s income statement for the year ending 31 March 2024, and a balance sheet as at that date.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Managerial Accounting

Authors: Stacey Whitecotton, Robert Libby, Fred Phillips

3rd edition

77826485, 978-0077722074, 77722078, 978-0077826482

More Books

Students also viewed these Accounting questions

Question

In the Babylonian system, what are the place values based on?

Answered: 1 week ago

Question

Explain how the net premium for an annuity is computed

Answered: 1 week ago