QUESTION ONE: From the trial balance below of L. Vong, prepare an income statement for the year ended 31 December 2021, and a balance sheet as at that date. (15 Marks). Trade receivables Business rates Trade payables Returns outwards Dr Cr 73, 200 19,978 62, 165 2,064 Drawings Inventory as at 1 January 2021 34, 792 25,967 Utilities 18,603 Wages and salaries 136, 163 Sales 592, 013 Equipment at cost 188, 760 Delivery Van at cost 92, 220 Equipment: Accumulated depreciation 74, 100 Delivery Van: Accumulated depreciation 60, 720 Purchases 307, 847 Bank 1, 337 Bad debt expenses 13, 192 Allowance for doubtful debt at 1 January 2021 Capital 2,240 118,757 912, 059 912, 059 Additional information: 1. The inventory was counted at 31 December 2021 was valued at 26, 424 2. Depreciation is to be applied at the following rates: Equipment (reducing balance) Delivery Van (Straight line) 30% 20% 3. The business rate in the trial balance includes a payment of 11, 760, which represents twelve month's business rates to 31 January 19, 2022. 4. Utilities charges incurred for which no invoice have yet been received amounted to a total of 4, 167 5. Based on a careful analysis of the business's debt collection experience, the allowance for doubtful debts is to be set at 4% of trade receivables.