Q3 After the completion of your initial examination of books and vouchers submitted by Hali mbaya, one of your clients, you have prepared the following Trial balance;

	Shs	Shs
Land and Building	9,000
Plant and machinery	5,000
Mortgage (secured on land and Building)		6,000
Stock at 1st May 2005	4,000
Sales		37,000
Purchases	32,000
Wages	7,000
Debtors	6,000
Creditors		19,000

Bank over draft		500
Capital		2,000
Drawings	1,500
	64,500	64,500

Your further inquiries reveal that the stock at 30 April 2006 is valued at shs 3,000. The realizable value of other assets is; Land and building shs 8,500

Plant and machinery shs 4,000 One debt of sh 500 is irrecoverable

Of the creditors, shs 1,000 are preferential in bankruptcy Personal drawings have not varied from previous years.

Required: Prepare statement of Affairs and Deficiency account.