a)prepare the P&L acc for the yearb) prepare the retained profit acc showing adjustemenc) prepare a Trial Balance at 30 June (after adjustment
TAFE Ltd. Trial Balance as at 30 June Details Before Adjustments After Adjustments Debit Credit Debit Credit TAFE Ltd. has provided you with its unadjusted trial balance for the year ended 30 June from which you are required to: Accrued interest on deposits Plant & machinery 5,000 60,000 (a) Prepare the profit and loss account for the year showing adjustments Accumulated depreciation. - plant & machinery 12,000 (b) Prepare the retained profits account showing adjustments Investments (purchased for long-term gain) 40,000 Accumulated impairment - investments (c) Prepare a Trial Balance at 30 June (after adjustments.) Trade debtors 10,000 25,000 Allowance for doubt. debts Cash in hand 1,000 (Calculations for all adjustments should be shown) Stock (30 June) 1,000 63,000 Adjustments to be made to Profit and Loss Deposits at call 17,500 . Investment assets are to be impaired by 50% of their carrying amount. Franchise 200,000 Goodwill was brought to account during the year as a result of a business combination resulting in the Goodwill 60,000 acquisition of the Franchise. The business combination has been valued at $225,000 with the Buildings (director's valuation) 100,000 recoverable amount of the Franchise valued at $190,000. Land (at cost) 600,000 Prepaid interest expense 15,500 Taxation information: Trade creditors 34,500 Debenture loan (due in 5 years) . Company tax rate is 30%. 150,000 The loss on sale of assets are to be treated as a permanent difference for taxation purposes as are Mortgage 75,000 impairments in investment assets and goodwill Employee benefits payable 18,000 . Cash at bank 67,500 Temporary differences were identified in the following asset and liability amounts. Income tax payable 12,500 Carrying Amount Tax Base Ordinary shares ($1 each) 605,500 Trade debtors $24,000 $25,000 Dividend reserve 100,000 Allowance for doubt. debts ($1,000) $0 Asset revaluation reserve 100,000 Plant & machinery $60,000 $60,000 Service income 400,000 Accumulated depreciation - plant & machinery 600.000 ($12,000) ($18,000) Credit Sales Employee benefits payable $18,000 $0 Cost of goods sold 50.000 Advertising 10.000 Auditors fees 20,000 Adjustments to be made to Retained Profits. Depreciation expense - Plant & Machinery 12,000 . Provide for a final dividend of $0.06 per share payable in the following year. Directors fees 2,000 Reduce the Dividend Reserve by $15,000 Doubtful debts 1,000 Create a General Reserve of $10,000 Employee benefits 8,000 Insurances 13,000 Interest on loans 25,000 nterest on deposits 2,000 Lease payments 9,000 Loss on sale of assets 1,000 Repairs 8,000 Wages 18,000 Income tax expense 50,000 Retained profits 1 July 41,000 Interim dividend 35.000 2,229,000 2,229,000 FNSACC 514 Asses ment 2A - Version 1
