Company Information Sheet - Wanda's Wardrobes:

• Wanda's Wardrobes Ltd is a local retail business that sells wardrobes. The business was set up by Wanda who registered the company on 1 July 2014 and issued 150 000 shares.

• The Financial year for the company ends on 30 June.

• Wanda's Wardrobes Ltd use sales, purchases, cash receipts, cash payments journals and a general journal, along with a general ledger and subsidiary ledgers for debtors and creditors. The majority of their customers pay in cash but they do offer credit to a handful of valued customers. Credit sales are on the terms: 5/10, n/30.

• Wanda's Wardrobes Ltd rent a local warehouse paying rent of $1 650 each month (including GST).

• The business uses a perpetual inventory system and applies the FIFO inventory flow assumption. Opening inventory is made up of 75 wardrobes @ $1 000 each.

• The company's warehouse fittings are being depreciated over 10 years with an estimated residual value of $6 500.The company has two delivery vans which are being depreciated over 6 years with an estimated combined residual value of $8 500.

• This new loan was taken out on the 31^st May and loan payments of $1 000 per month plus interest will be made monthly with the first payment due on the 1^st July 2020.Interest is to be paid at a rate of 7% per annum. The first month's interest is to be calculated on the full value of the loan of $60 000.

• Provision for doubtful debts is always adjusted at the end of each month to equal 4% of the value of debtors at that time.

• The company account for GST on an accrual basis and reconcile and pay GST every quarter.All figures are GST inclusive unless otherwise stated, thus you will need to divide each figure by 11 to identify the GST component.

• GST was last paid in April 2020 and was next due to be paid in July 2020 thus you DO NOT need to reconcile or pay GST at the end of June 2020 for the quarter.This will be done by the accountant in July.

• Gross wages represent the total wages expense. Tax taken from wages needs to be treated as "Tax Payable" ie: Gross wages = net wages paid + PAYG Tax Payable

• Round all amounts to the nearest dollar.

The trial balance of the company at 31 May 2020 was as follows:

Wanda's Wardrobes Ltd

Trial Balance

as at 31 May 2020

DRCR

100Cash at bank160 550

101Debtors control14 800

102Provision for doubtful debts592

103Inventory75 000

104Warehouse Fittings80 300

105Accumulated depreciation - W/H Fittings14 145

106Motor Vehicles (Delivery Vans)62 500

107Accumulated depreciation -m/vehicles 9 000

200Creditors control16 200

250Accrued Expenses7 980

260Loan60 000

300Share capital200 000

310Retained profits97 125

400Sales Revenue 589 518

401Sales returns3 900

402Discount revenue 5 850

500Cost of goods sold330 500

501Depreciation Expense - W/H Fittings6 765

502Depreciation Expense - M/V8 250

503Discount expense2 620

504Electricity expense11 200

505Income Tax expense60 000

506Interest expense4 125

507Motor Vehicle expenses7 500

508Rent expense16 500

509Sundry expenses5 200

510Telephone expense2 250

511Wages expense151 000

600GST Collected9 100

610GST Paid6 550

$1 009 510$1 009 510

Schedule of Debtors Schedule of Creditors

as at 31 May 2020as at 31 May 2020

Red Ltd 2 400Melon Ltd1 300

Amber Ltd3 200Plum Ltd7 600

Jade Ltd1 700Pineapple Ltd1 900

White Ltd7 500Yack Ltd5 400

$14 800$16 200

The following transactions occurred in June 2020:

(All figures are inclusive of GST unless otherwise stated)

June1Received a cheque for $2 200 from Red Ltd (no discount allowed) as part

payment of their account, and deposited it in the bank account [Hint: GST does not need to be considered when you record this transaction, as GST received would have been recorded at the time of the original sale]

2Sold 3 wardrobes for $6 000 (before discount) to Jade Ltd on credit, the

company was also given a trade discount of $500, then the normal credit

terms) [Hint: Sale = $5 000; GST Collected = $500; COGS/Inventory =

$3 000]

4Purchased 10 wardrobes on credit from Pineapple $12 100 (no discount)

5Paid Yack $5 200 in full settlement of amount owing, chq no. 252(the business was given a settlement discount for the difference)

8Received and deposited payment in full from White Ltd (no discount

allowed)

11Sold 10 wardrobes on credit to White for $22 000

12Paid Pineapple Ltd $3 495, being part payment of account owing to date, chq no. 253

12Paid telephone account of $825, chq no. 254

14Received a cheque for $5 500 from White Ltd in part payment of their

account (no discount allowed)

14Banked cash sales of 25 wardrobes sold for a total of $51 150

14Withdrew cash from the bank account to pay wages of $3 900(after PAYG

tax, gross wages were $5 900 (wages before tax).

17Paid $462 for plastic bags and stationery items, chq no.255

18Sold 2 wardrobes credit to Amber Ltd $3 564

23Paid Melon Ltd $ 1 300, chq no. 256

27Paid sundry expenses of $250, chq no. 257

28Wrote off the balance of the account owed by Red Ltd as a bad debt

28Deposited Cash from sales of 15 wardrobes of $30 800

29Withdrew cash from the bank to pay wages of $4 300, gross wages were

$6 200.

29Purchased 4 wardrobes on credit from Pineapple Ltd of $5 380 (before discount) The business was allowed a trade discount of $100 and terms of 1/10, n/30

30Banked cash sales from the sale of 3 wardrobes for a total of $7 700

30Amber Ltd paid their debt in full by cash (no discount allowed).

30Paid the rent for June, chq 258

Additional information at the end of the month:

Ignore GST for all adjusting entries.

Gross wages owing at the end of the month total $5 000 (no PAYG tax payable)

Electricity owing for the month of June is $500 (no GST)

Advertising owing for the month was $500 (no GST)

Income tax for the month of June 2020 is estimated to be $8 200 (no GST)

On the last day of the month (30 June) the business traded both of the delivery vans in for two larger vans worth $120 000 in total(GST free - no GST). They were given a trade in of $60 000 on the old vans, with the balance to be paid in 30 days. The new vans depreciation rate and residual value have not yet been determined

No entries had been made in the accounts to allow for any of these items yet

The bank statement received at the end of June shows the following information:

Bank Statement

Wanda's Wardrobes Ltd

2020DebitCredit Balance

June1Balance160 000CR

Deposit4 800164 800CRDeposit2 200 167 000CR

3Chq.no. 200 3500163 500CR

4Chq.no. 201750162 750CR

8Chq. no. 2525 200157 550CR

Deposit7 500 165 050CR

14Chq. no. 2533 495161 555CR

14Deposit5 500 167 055CR

14Deposit51 150 218 205CR

14Chq. no. 254825217 380CR

14Cash withdrawal3 900213 480CR

19Chq. no. 255462213 018CR

27Chq. no. 2561 300211 718CR

29Deposit30 800 242 518CR

30Cash withdrawal4 300238 218CR

30Bank fees/charges35238 183CR

30Dividend Received1 500 239 683CR

At 31 May 2020 there were two outstanding cheques - cheque no. 200 for $3 500 and cheque no. 201 $750 and an outstanding deposit for $4 800.

Question

General journal

Pre-Closing Trial balances as at 30 June 2020

Post-Closing Trial Balance as at 30 June 2020

Income Statement (Statement of Financial Performance) for the year ended 30 June 2020

Balance Sheet (Statement of Financial Position) as at 30 June 2020

Bank Reconciliation as at as at 30 June 2020