Lecture $2$ Activity: Published Accounts Revision: Questions

The trial balance for Blackpool Rocks Ltd at $30$ June $2023$ is as follows:

The figures in the above trial balance include all transactions processed to date.

The following transactions have not yet been processed and needs to be adjusted for:

i$)$ Depreciation of $150,000$ on plant and machinery has not yet been accounted for.

ii$)$ A count of inventory taken on $30$ June $2023$ has indicated that the company has finished goods

inventory valued at $595,000.$ Included in this amount is inventory that had a historic cost of $45,000$

but was identified during the count as being damaged and it is expected that it can only be sold for

f$25,000.$

iii$)$ Interest has been accounted for on a cash basis only and therefore only part of the interest charge has

been accounted for so far.

iv$)$ A gas and electricity bill has been received post year$-$end which has not yet been accounted for. The

invoice total is $45,000$ and is for the $3$ months to $31$ July $2023.$

v$)$ Rent of $10,000$ was paid during June $2023$ for the period of July $-$ September $2023.$ This was incorrectly

recorded as an operating expense.

vi$)$ Debts of $35,000$ have been identified as being not collectable and need to be provided for.

vii$)$ During the year, the buildings were damaged in a storm and after repairs; the buildings were assessed as

being impaired by $125,000.$

Required:

a$)$ Make the necessary adjustments to account for the information included in parts $($i$)-($vii$)$ above. Show

you workings clearly.

b$)$ Prepare an income statement for the year to $30$ June $2023.$

c$)$ Prepare a balance sheet as at $30$ June $2023.$