Question 1

The following is the receipts and payments account of the Masaibu Club for the year ended 31 December 2019:

	KES 000		KES 000
Balance at bank 31 December 2018	102	Bar purchases	4,434
Entrance fees	42	Wages	416
Subscriptions: 2018	25	Rent	186
2019	305	Heating and lighting	128
2020	35	Postage and stationery	33
Bar Sales	5,227	Insurance	18
Sale of investments	750	General expenses	46
		Payments on account of new furniture	450
	_____	Balance at bank, 31 December 2019	775
	6,486		6,486

The following information is also supplied:

1)

	31 December 2018	31 December 2019
	KES 000	KES 000
Bar stock, at cost	272	315
Creditors for bar purchases	306	358
Rent due	18	36
Heating and lighting expenses due	16	19
Subscriptions due	25	40
Insurance paid in advance	5	7

2. On 31 December 2018, the club held investments which cost KES 500,000. During the year ended 31 December 2019, these were sold for KES 750,000.
3. Furniture was valued at KES 300,000 on 31 December 2018. On 1 July 2019, the club purchased additional furniture at a cost of KES 520,000. Depreciation of all furniture is to be provided for at the rate of 10% per annum on a proportionate to time basis.

Required:

1. Prepare an income and expenditure account for the year ended 31 December 2019.
2. Prepare a balance sheet at that date.