Question 1-Compubery Financial Statements (100 Marks) The following trial balance was extracted from the books of Mr. Biden a trader on the 31 December 2020 Cash Dr Cr 190 19,000 1,250 2,400 20,895 Bank Inventory 1/1/2000 23,250 Accounts Receivable 13,500 Land and Buildings (cost) 53,750 Fixtures and fittings (cost) 7,500 Motor vehicles (cost) 9,800 Provision for depreciation Fixtures and flings Motor vehicles Accounts Payable Provision for bad debts 430 Loo 25,000 Capital 30,225 Drawing 4,125 Sales 248.625 Sales returns 4.125 Purchases 146,230 Purchases return 6,830 Camage inwards 900 Rest 3,500 Rates 2,500 Discount allowed 1,100 Insurance 1,240 Light and heat 8,150 Loan Interest 1,750 Advertising 5,475 Wages and Salaries 29,270 335,655 335,655 Additional information (i) Inventory at 31/12/2000 was valued at 50,000 (i) Rent prepaid amounted to 1,500 (i) Light and heat accrued amounted to 1,750 (iv) The provision for bad debts is to be inovased by 1,000 (v) Depreciate on a straight-line basis fixtures and fittings by 10% and motor vehicles by 20% a) Prepare an Income Statement for year ended 31 December 2020. b) Prepare a Statement of Financial Position as at 31" December 2020. c) What is the accounting equation? Briefly explain each of the three parts. d) How is net profit calculated? Define revenues and expenses. 50 Marks 30 Marks 10 Marks 10 Marks