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Open Questions Question 1 . (60 points) The following trial balance has been extracted from the ledger of Mr Yousef, a sole trader. TRIAL BALANCE

Open Questions

Question 1. (60 points)

The following trial balance has been extracted from the ledger of Mr Yousef, a sole trader.

TRIAL BALANCE AS AT 31 December 20X9

Dr

Cr

$

$

Sales

138,000

Purchases

78,000

Delivery expenses

6,500

Drawings

20,200

Prepayment for insurance

3,300

Postage and stationery

7,700

Advertising

1,100

Salaries and wages

27,000

Irrecoverable debts

580

Receivables

15,000

Payables

6,000

Cash on hand

1,200

Cash at bank

11,500

Inventory as at 1 January 20X9

14,500

Equipment at cost

37,500

Accumulated depreciation

12,800

Capital

47,280

6% Loan

20,000

Total

224,080

224,080

The following additional information as at 31 December 20X9 is available.

1 The bill for telephone expense is received quarterly in arrears. You have received a bill for a telephone expense on 1st of February in the amount of $450.

2 Prepayment on Insurance was made on 1st of August 2019.

3 $2,500 of delivery expenses represents delivery on purchases made and the rest is for the delivery of the products that we have sold

4 Equipment has to be depreciated. The useful life of the Equipment is 10 years with the salvage value of $2,500. The method of depreciation is a declining balance method.

5 The allowance for receivables has to be equal to 5% of Receivable balance

6 Inventory at the close of business has been valued at $5,000

7. Salary for December of $3,100 has not been accrued by the accountant.

8. The sales figure includes $2,000, for which the services have not actually been performed.

9. Interest expense for the year was $700.

10. The accountant forgot to show the receipt of cash of $1,000 from your customers.

11. The Loan was obtained on 1st of November 20X9. No interest has been accrued.

Required

(a) Prepare a statement of profit or loss for the year ended 31 December 20X9 (30 points)

(b) Prepare a statement of financial position as at that date. (30 Points)

please write adjustment and final trial balance journal entries

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