Mr. Tomson has started a trading business, which is a sole distributor of DUNLOP TYRES Malaysia, in SS15, Subang Jaya on 1 December 2019. At the end of first month operation, the following transactions were extracted from the book on 31 December 2019:

 2019

Dec      1          Mr. Tomson invested RM100,000 in the company’s bank account as well as a car worth RM25,000 to start a business.

  3          Bought office fitting RM3,500 on credit from MayTab Business.

  9          Bought goods RM32,500 from supplier by cheque.

  12        Bought stationery RM580 through bank transfer.

 15        Paid RM4,000 by using company’s debit card for the tuition fees of owner’s son.

 20        Sold goods 130 tyres (RM140 for each tyre) on credit to Kim Motor and 25 tyres (RM170 for each tyre) on credit to Bintang Car respectively.

 22        Paid delivery charges RM450 with personal debit card to City Link Express for the transaction occurred on December 9.

 24        Sent 50 tyres to participate in the local car exhibition at Sunway Phyramid. Delivery charges amounted to RM720 was owed to GD Express. No sales transactions were taken place on the day.

 26        Received goods 5 tyres returned by Bintang Car.

28        Paid transport RM1,240 by cheque for transaction occurred on December 20.

          

Required:

(a)       Record the following transactions into the ledger and balance off the accounts.                                                                                                                                                                

(b)       Extract a trial balance as at 31 December 2019.                                                

 

Question G2

Mr. Tomson (from question G1) has consulted with you with the following questions:

1. Explain briefly the benefit of current assets to the business in the short

term (less than 12 months), and                    

 (b)       Explain how will you manage the transaction incurred on December 24?                                                                                                                                     

 (c)       Describe the reason(s) that business spends so much times preparing the trial balance?