QUESTION 1 FINANCIAL STATEMENT OF SOLETRADER

STATEMENT OF COMPREHENSIVE INCOME OF BIG-BOY TRADERS FOR YEAR ENDED 28 FEBRUARY 2018

QUESTION 1 FINANCIAL STATEMENT OF SOLETRADER REQUIRED: The statement of comprehensive Income Big-Boy Traders for the year ended (20 Marks) 4000 28 February 2018 Information: PRE-ADJUSTEMENT TRIAL BALANCE OF BIG-BOY TRADERS AS AT 28 FEBRUARY 2018 Balance sheet accounts section Capital Debit Credit Drawings 142 900 Vehicles at cost 54 200 Accumulated depreciation on vehicles 200 000 Equipment 90 000 Accumulated depreciation on equipment 100 000 40 000 Debtors control 30 000 Trading inventories 60 000 Bank 22 000 Cash float 1 000 Provision for bad debts Mortgage loan: RT BANK (18 % p.a.) 80 000 Creditors control 30 000 Nominal accounts section Sales 510 000 Cost of sales 250 000 Sales returns 10 000 Salaries and wages 86 000 1 000 Bad debts 2 000 Stationery 26 000 Rent expense 18 000 Motor expense 500 Discount allowed 10 000 Telephone 13 000 Nater and electricity 3 000 Bank charges 6 000 nsurance 13 200 nterest on mortgage loan 1 000 ad debts recovered 8 000 ommission income 905 900 905 900 justments 1. According to physical stocktaking done on 28 February 2018, the following were on hand: Trading inventory, R58 000 Stationery, R400 2. No entry has been made for a cheque of R2 000 received from a debtor P. Martin in settlement of his debt of R2 100 An account received from Honda Motors for the replacement of tyres on the motor vehicle has not beer recorded, R4 000 Write off the account of debtor H. Hilton, R1 000. 5. Charged a debtor RR100 interest on his overdue account. The entry to record this has not yet been made. 6. Provision for bad debts must be R1 500 7. Water and electricity account for February 2018 is still unpaid, R1 300 8. Rent has not been paid up to 31 March 2018. 9. Interest on loan for February 2018 has not yet been paid. 10. The insurance total includes an annual premium of R2 400 that was paid for the period 01 June 2017 to 31 May 2018. 11. The bank statement for February 2018 reflected service fees of R200 that has not yet been recorded. 12. Commission income at R10 per unit for 500 units of inventory sold during February 2018 is still due from a supplier. 13. Provide depreciations follows . On equipment at 10% per annum using the fixed instalment method. On vehicles at 20% per annum on the carrying/book value. FORMAT FOR THE STATEMENT OF COMPREHENSIVE INCOME OF BIG BOY TRADERS FOR THE YEAR ENDED 28 FEBRUARY 2018 Sales Cost of sales Gross profit Operating incomes Gross income Operating expenses Operating profit before interests Interest income Interest expense Net profit for the year