QUESTION $1$

$(60$ Marks

$90$ Minutes$)$

Sticky Toffee Traders is owned by Mr Wilson, a sole trader. Mr Wilson is a general trader of various retail goods and has a financial year end of $31$ December. You are provided with the following preadjustment trial balance:

STICKY TOFFEE TRADERS

PRE$-$ADJUSTMENT TRIAL BALANCE AS AT $31$ DECEMBER $2020$

$\backslash$table$[[,\backslash$table$[[$R$],[$Debit$]],\backslash$table$[[$R$],[$Credit$]],],[$Real accounts,$],[$Capital$,$B$1,,192375],[$Motor vehicles at cost$,$B$2,245000,],[$Accumulated depreciation: motor vehicles,B$3,,147000],[$Computer equipment at cost$,$B$4,63900,],[$Accumulated depreciation: computer equipment,B$5,,23004],[$Land and buildings,B$6,752000,],[$Loan from: Peoples Bank,B$7,,71000],[$Mortgage bond: Peoples Bank,B$8,,485000],[$Fixed deposit: Peoples Bank,B$9,77000,],[$Bank$,$B$10,25880,],[$Petty cash,B$11,1050,],[$Inventory$,$B$12,178550,],[$Accounts receivable,B$13,98545,],[$Accounts payable,B$14,,67899],[$Nominal accounts$],[$Sales$,$N$1,,3322486],[$Interest income,N$2,,6738],[$Rent income,N$3,,137200],[$Insurance refund,N$4,,12500]]$

Page $2$

CONSTRUCTION ACCOUNTING III $-$ CSA$306$D

ASSIGNMENT

DUE DATE: $13$ SEPTEMBER $2024$

$\backslash$table$[[$Purchases$,$N$7,1658775,],[$Advertising$,$N$8,18552,],[$Accounting fee,N$9,27000,],[$Bank charges,N$10,15546,],[$Credit losses,N$11,12355,],[$Consulting fees,N$12,55000,],[$Interest expense,N$13,50967,],[$Insurance$,$N$14,47250,],[$Stationery$,$N$15,7445,],[$Motor vehicles expenditure,N$16,19885,],[$Courier and postage,N$17,2745,],[$Repairs and maintenance,N$18,48774,],[$Salaries and wages,N$19,787445,],[$Subscriptions$,$N$20,14000,],[$Legal fees,N$21,7988,],[$Donations$,$N$22,1680,],[$Staff welfare,N$23,28774,],[$Staff training,N$24,83760,],[,1362106,]]$

Additional information:

Insurance includes an amount of R$18900,$ which was paid for a sixmonth period from $1$ October $2020.$

Closing inventory as at $31$ December $2020$ amounted to R$274886.$

Rent income was received for the period $1$ January $2020$ to $28$ February $2021.$ Rent income is fixed monthly payment.

Page $3$

Subscriptions paid is only for $10$ months instead of $12$ months. Subscriptions are equal monthly premiums.

Interest on the fixed deposit only reflects interest from $1$ January $2017$ to $31$ July $2020.$

People Bank is still obligated to pay interest for the rest of the year.

Depreciation for the year needs to be raised. Computer equipment is depreciated at $20\%$

p$.$a$.$ on the reducing$-$balance method, and motor vehicles at $20\%$ p$.$a$.$ on straight$-$line method. Depreciation for building amounted to R$71000$ for the year.

Interest on non$-$current liabilities has only been paid for $11$ months. Interest should represent the full $12$ months.

An additional credit loss amounting to R$3888$ needs to be written off as per Mr Wilson.

Allowance for credits losses must be provided at $7\mathrm{.}5\%$ of gross trade receivable.

YOU ARE REQUIRED TO:

$\backslash$table$[[1,$Prepare the post$-$adjustment trial balance at $31$ December $2020,\backslash$table$[[38\mathrm{.}5$