QUESTION 2 (20 Marks) REQUIRED Use the information provided below to prepare the Statement of Comprehensive Income for the year ended 29 February 2020. Use the following format as a guide: Statement of Comprehensive Income format Sales Cost of sales Gross profit Other operating income Gross operating income Operating expenses Operating profit Interest income Interest expense Net profit for the year vmc INFORMATION DURAVIT TRADERS PRE-ADJUSTMENT TRIAL BALANCE AS AT 29 FEBRUARY 2020 Debit (R) Credit (R) Balance Sheet accounts section Capital 1 255 000 Drawings 80 000 Land and buildings 900 000 Vehicles at cost 680 000 Equipment at cost 500 000 Accumulated depreciation on vehicles 380 000 Accumulated depreciation on equipment 160 000 Fixed deposit: Sen Bank (6% p.a.) 150 000 Trading inventory 115 000 Debtors control 130 000 Provision for bad debts 8 000 Bank 67 000 Cash float 6 000 Creditors control 110 000 Mortgage loan: Sen Bank (12% p.a.) 320 000 Nominal accounts section Sales 1 500 000 Cost of sales 480 000 Sales returns 10 000 Salaries and wages 419 000 Bad debts 12 000 Stationery 20 000 Rates and taxes 58 000 Motor expenses 90 000 Repairs to building 17 000 Telephone 38 000 Electricity and water 46 000 Bank charges 8 000 Insurance 20 000 Interest on mortgage loan 33 000 Interest on fixed deposit 6 000 Rent income 140 000 3 879 000 3 879 000 Adjustments and additional information 1. The electricity and water account for February 2020, R4 000, was due to be paid on 03 March 2020. 2. A debtor, P. Smith, was declared insolvent. His insolvent estate paid R600 which represented 40% of his debt. The balance of his account must now be written off. vmc 3. 3.1 3.2 Stocktaking on 29 February 2020 revealed the following inventories: Trading inventory R110 000 Stationery R2 000 4. The provision for bad debts must be decreased by R1 500. 5. Rent has been received up to 30 April 2020. 6. The insurance total includes an annual premium of R6 000 that was paid for the period 01 September 2019 to 31 August 2020. 7. Provide for outstanding interest on the mortgage loan for February 2020. 8. Provide for outstanding interest on fixed deposit. The investment in fixed deposit was made on 01 June 2019. 9. The credit purchase of tyres for a motor vehicle was not recorded, R5 000. 10. 10.1 10.2 Provide for depreciation as follows: On equipment at 10% p.a. on cost. On vehicles at 20% p.a. using the diminishing balance method.