Make use of the information below and draw up the following:

PRE-ADJUSTMENT TRIAL BALANCE ON 28 FEBRUARY FOR ABC TRADERS 2019

Ordinary share capital (R1 ea)

280 000

Ordinary share premium

30 000

Retained Income

41 000

Loan from Umgeni Bank (15% p.a.)

27 000

Land and Buildings

360 000

Equipment

50 000

Accumulated depreciation on equipment

20 000

Inventory

82 000

Trade debtors

40 000

Allowance

1 500

Bank

16 300

Cash float

750

Petty cash

250

Trade creditors

12 800

SARS (Income tax)

7 000

Nominal accounts section

Sales

476 000

Sales returns

8 000

Cost of sales

208 000

Salaries and wages

90 000

Directors fees

17 000

Audit fees

4 000

Interest on loan

2 000

Credit losses

1 400

Rent income

9 900

Commission income

7 700

Packing material

2 600

Insurance

400

Sundry expenses

11 200

Dividends on ordinary shares (interim)

5 000

Adjustments to be effected on 28 February 2019

The following was found as per physical count.

1. 1. Trading Stock R80 300

1. 2. Packing Material R700

2. Depreciate equipment at 10% p.a. on the diminishing balance method.

3. Write of further credit losses of R2000.

4. Adjust allowance for credit losses to 5% of trade debtors.

5. Provide for the outstanding interest on loan.

6. Provide rates at 2% on value of land and buildings.

REQUIRED:

1.1. STATEMENT OF FINANCIAL POSITION for ABC Traders 28 Feb 2019 (15)

1.2 Notes to the statement of financial position, specifically the property, plant and equipment note