BBFA1113 PRINCIPLES OF ACCOUNTING Answer ALL FOUR (4) questions, Question 1 The following trial balance was extracted from the accounting records of Jolly Trading as at 31 December 2020 Trial Balance as at 31 December 2020 Debit Credit RM RM Sales 650,000 Purchases 380,000 Inventories as at 1 January 2020 50,000 Cash in hand 5,000 Bank 25,000 Drawings 1000 Building 500,000 Accumulated depreciation - Building 20,000 Fixtures and fittings 200,000 Accumulated depreciation - Fixtures and fittings 30,000 Trade receivables and trade payables 75,000 45,000 Allowance for doubtful debts 2,200 Rental received 5.500 Insurance 2.200 Stationery 120 Staff salaries 60,000 Capital 540,820 Consulting revenue 1.298,320 1,298,320 Additional information: Inventories as at 31 December 2020 amounted to RM18,000. 2. Depreciation policies of the business are as follows: Building 2% on cost Fixtures, fittings and office equipment 15% on reducing balance basis. The depreciation policy is to charge a full year of depreciation in the year of acquisition and no depreciation in the year of disposal. 3. There was a prepaid insurance premium of RM600 as at 31 December 2020. The rental receivable at year end amounted to RM500. 4.800 1. 4. BBFA1113 PRINCIPLES OF ACCOUNTING Question 1 (Continued) 6. 5. During the year, Jolly, the owner, took the following from the business for his personal use: RM1,000 in inventory items; RM6,000 from the bank. In addition, one quarter of the RM2,000 insurance costs recorded in the trial balance above relate to Jolly's personal insurance. RM2,500 is to be written off as bad debt. Jolly has examined the receivables listing and has determined that an allowance for doubtful debts of 2% is to be provided on net trade receivables. Required: Prepare the Statement of Profit or Loss of Jolly Trading for the year ended 31 December 2020. (11 marks) (b) Prepare the Statement of Financial Position of Jolly Trading as at 31 December 2020. (14 marks) [Total: 25 marks)