Sanele, a plumber, started his business servicing residential and commercial properties in 2016 He named his business Plumber4U The financial year end is 30 June 2019 The following balances appeared in the records of Plumber4U as at 01 June 2019 Debit Bank Vehicles 250 000 Accumulated depreciation on vehicles 82 450 Investment (15 p a) 120 000 Loan (8 ) 75 000 Equipment 145 000 Accumulated depreciation on equipment 25 790 Accounts Receivable 18 740 Allowance for doubtful debts 2 510 Accounts Payable 8 070 Capital 180 000 The following transactions relate to June 2019 1 Serviced the home of Mrs Brown amounting to R2 500 Purchased supplies on credit from Plumblink for R6 950 Purchased stationery from PNA, amounting to R550 Several homes were serviced receipts were issued amounting to R34 580 7 Received an invoice for R4 200 in respect of a shipment of pipes purchased on credit 10 A debtor who owed Plumber4U R3 500 was declared insolvent His estate paid 30 in the rand and the remainder should be written off as irrecoverable Serviced a business called Chapman Traders for R18 450 Mrs Brown was unhappy with the service and demanded a discount on her account Plumber4U agreed to grant her a R500 reduction on her account She then paid her outstanding balance in full Interest on the investment was received for the month Purchased an additional vehicle, amounting to R80 000 Sanele paid 20 from his personal savings and the remainder will be paid off in seven monthly instalments Depreciation for the period has been calculated as R1 250 for vehicles and R1 050 for equipment Plumber4U operates from a rented office space The rent for June, July and August was paid amounting to R18 900 The telephone account was received and paid for June 2019 amounting to R1 590, R590 was for the business account and R1 000 for Saneles personal cellphone account The allowance for doubtful debts is to be maintained at 10 of outstanding debtors at year end The loan was taken out on 01 January 2019 The interest is paid in arrears on the 1 st of each month A stock take at month end revealed the following Supplies on hand, R1 590 Stationery on hand, R300 You are required to Prepare the Statement of Profit or Loss, Statement of Changes in Equity and Statement of Financial Position of Plumber4U for the month ended 30 June 2019 (14 marks)

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Jul 12, 2024

Sanele, a plumber, started his business servicing residential and commercial properties in 2016. He named his business Plumber4U. The financial year end is 30 June

Sanele, a plumber, started his business servicing residential and commercial properties in 2016. He named his business Plumber4U. The financial year end is 30 June 2019.

The following balances appeared in the records of Plumber4U as at 01 June 2019:

	Debit
Bank	?
Vehicles	250 000
Accumulated depreciation on vehicles	82 450
Investment (15% p.a)	120 000
Loan (8%)	75 000
Equipment	145 000
Accumulated depreciation on equipment	25 790
Accounts Receivable	18 740
Allowance for doubtful debts	2 510
Accounts Payable	8 070
Capital	180 000

The following transactions relate to June 2019:

1. Serviced the home of Mrs Brown amounting to R2 500.

Purchased supplies on credit from Plumblink for R6 950. Purchased stationery from PNA, amounting to R550.

Several homes were serviced; receipts were issued amounting to R34 580.

7. Received an invoice for R4 200 in respect of a shipment of pipes purchased on credit.

10. A debtor who owed Plumber4U R3 500 was declared insolvent. His estate paid 30% in the rand and the remainder should be written off as irrecoverable.

Serviced a business called Chapman Traders for R18 450.

Mrs Brown was unhappy with the service and demanded a discount on her account. Plumber4U agreed to grant her a R500 reduction on her account. She then paid her outstanding balance in full.

Interest on the investment was received for the month.

Purchased an additional vehicle, amounting to R80 000. Sanele paid 20% from his personal savings and the remainder will be paid off in seven monthly instalments.

Depreciation for the period has been calculated as R1 250 for vehicles and R1 050 for equipment.

Plumber4U operates from a rented office space. The rent for June, July and August was paid amounting to R18 900.

The telephone account was received and paid for June 2019 amounting to R1 590, R590 was for the business account and R1 000 for Saneles personal cellphone account.

The allowance for doubtful debts is to be maintained at 10% of outstanding debtors at year-end.

The loan was taken out on 01 January 2019. The interest is paid in arrears on the 1^st of each month.

A stock-take at month-end revealed the following:
- Supplies on hand, R1 590
- Stationery on hand, R300

You are required to:

Prepare the Statement of Profit or Loss, Statement of Changes in Equity and Statement of Financial Position of Plumber4U for the month ended 30 June 2019. (14 marks)