Financial Statements with Year-end Adjustments 173 The following adjustments are to be taken into account: vel Inventory as at 31 December 20X2 was valued at RM2.600. The interest on the loan taken from Affin Bank was not recorded in the accounts. Prepaid RM300 of the insurance premiums. al Prepaid RM125 of the telephone and electricity bills. le) Depreciation was provided using the rates as follows: Office equipment 20% p.a. on carrying value 15% p.a. on cost 10% p.a. on cost Motor vehicles Furniture (A Bad debts of RM110 were to be written off. (a) The allowance for doubtful debts was to be adjusted to 2.5% of the remaining accounts receivable. (h) Fadley had drawn RM150 cash from the business to spend on his son's birthday. Required: Prepare a statement of profit or loss for the year ended 31 December 20X2 and the statement of financial position as at that date. 9. The following trial balance was extracted from the books of Fadley Trading as at 31 December 20X2. Debit Credit (RM) (RM) 12,250 Office equipment Motor vehicles 9,150 Furniture 3,600 Accumulated depreciation as at 1 January 20X2 Office equipment 2,450 Motor vehicles 1,373 Furniture 1,060 Accounts receivable and accounts payable 6,860 3,632 Capital 29,608 6% loan to Radzi 2,500 Purchases and sales 19,110 31,560 Discounts 215 175 Advertising 4,250 Cash 1,630 Allowance for doubtful debts Commission received 300 6% loan from Affin Bank (taken on 1 May 20X2) 740 Rent 8,000 1,200 Drawings Maintenance and petrol Staff's wages 700 1,900 1,260 Insurance 4,005 Bank 1,000 Carriage inwards Carriage outwards Telephone and electricity 5,270 210 250 Duties on purchases 610 Returns 915 Inventory as at 1 January 20X2 110 112 3,415 79,710 79,710