Royal Footwear Boutique $($Pty$)$ Ltd specializes in luxury footwear and related premium

accessories. The company's financial year concluded on $31$ December $2023.$

You have been given an extract from the pre$-$adjusted trial balance of Royal Footwear

Boutique $($Pty$)$ Ltd for the $2023$ financial yearend.

The following is the extract of the pre$-$adjustment trial balance of Footwear

Boutique $($Pty$)$ Ltd as at $31$ December $2023$:

Account

Debit

$($R$)$

Credit

$($R$)$

Trade receivables $165000$

Inventory $90000$

Bank $35000$

Trade payables $40000$

Sales $620000$

Cost of sales $430000$

Additional Information:

$$ On $15$ December $2023,$ Royal Footwear Boutique $($Pty$)$ Ltd received R$13500$ cash

from Mrs$.$ DeSilva, an old debtor, whose account was written off as irrecoverable

in the previous year.

$$ On $20$ December $2023,$ a debtor, Mr$.$ Luxe, was declared insolvent. He owed Royal

Footwear Boutique an amount of R$5000.$ A final dividend of twenty cents in the

rand was received from the insolvent estate. The remainder of the debt was to be

written off.

$$ On $31$ December $2023,$ it was determined that a debtor, Mr$.$ Stevens, was not going

to settle his debt of R$3500$ and should be written off.

$$ After accounting for the bad debt from Mr$.$ Stevens, the company estimates that

$5\%$ of the remaining trade receivable balance as of $31$ December $2023$ is doubtful. REQUIRED:

$1\mathrm{.}1$ Prepare the adjusting general journal entries based on the above additional

information for Royal Footwear Boutique $($Pty$)$ Ltd for the financial year ended

$31$ December $2023.$

Instructions:

$$ Include all necessary headings and sub$-$headings in your journals.

$$ Provide workings where necessary.

$$ Assume that there were no other transactions for the year.

$$ Dates and narrations may be ignored.

$(10$ marks$)$

$1\mathrm{.}2$ Prepare an extract of the Statement of Financial Position to present only the

Current Assets for Royal Footwear Boutique $($Pty$)$ Ltd for the financial year

ended $31$ December $2023.$ Notes are not required.