QUESTION 1 The following trial balance was extracted from the books of Kirsty Enterprise as at 31 December 2020: RM RM Purchases 126,320 Capital, 1 January 2020 28,882 Return inwards/return outwards 5,855 2,750 Drawings 31,945 Carriage inwards 6,290 Carriage outwards 1,200 Equipment at cost 74,800 Accumulated depreciation - equipment 14,960 Allowance for doubtful debts 1,390 Discounts allowed/discount received 8,525 2,340 Motor vehicle at cost 36,800 Accumulated depreciation - motor vehicle 13,248 Stock 19,580 Accounts receivable 16,420 Accounts payable 13,964 Bank 15,998 Sales 400,040 Motor expenses 26,987 Salaries and wages 79,586 Rent and rates expenses 14,630 Utilities expenses 9,270 Printing and stationery expenses 3,368 477,574 477,574 Additional information at 31 December 2020: (i) Stock held at 31 December 2020 was RM17,322. (ii) A payment for Kirsty's personal rent of RM1,500 was included in the rent and rates expenses. (iii) An unpaid utilities bill of RM1,986 was still outstanding as at 31 December 2020. (iv) One month's advance salary payment of RM2,500 was paid to one of the employees. An outstanding invoice to one of the accounts receivable of RM3,760 has to be written off as bad debts before allowance for doubtful debts is to be adjusted at 5% of the accounts receivable balance. Page 2 of 9 (vi) Depreciation policy is as follows: Equipment at 10% straight line method Motor vehicle at 20% reducing balance method (All amounts are to be rounded to the nearest Ringgit) Required Prepare the following statements for the financial year ended 31 December 2020: a) Statement of profit or loss b) Statement of financial position (10 marks) (10 marks) [Total 20 marks]