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The managers of SV Bhd provide the following information. Selected balances on 1 October 2021: Cash budget for the six months ending 28 February 2022
The managers of SV Bhd provide the following information. Selected balances on 1 October 2021: Cash budget for the six months ending 28 February 2022 - 10% of sales each month are cash sales. 50% of sales are expected to be settled one month following the sale. The remaining 40% of sales are expected to be settled two months after the sale. - All purchases will be on credit. Suppliers will be paid in the month following purchase. - General expenses will be paid as incurred. - A bonus issue of 1 new ordinary share for every 3 held will be made on 1 December 2021. The directors propose that equal amounts are used from the company's capital reserves. - Non-current assets will be purchased on 1 November 2021 for RM17,000. Half of the cost will be paid on that date, the balance will be paid on 1 April 2022. - The non-current assets that cost RM20,000 will be sold in November 2021 for RM8,000. They will have been depreciated by RM11,000 at the date of sale. - The non-current assets are depreciated at 10% per annum on net book value at the balance sheet date. - Stock on 31 December 2021 was valued at RM2,000. Required: a. Prepare a forecast trading and profit and loss account and an appropriation account for the three months ending 31 December 2021 in as much detail as possible. b. Prepare a forecast balance sheet on 31 December 2021 in as much detail as possible The managers of SV Bhd provide the following information. Selected balances on 1 October 2021: Cash budget for the six months ending 28 February 2022 - 10% of sales each month are cash sales. 50% of sales are expected to be settled one month following the sale. The remaining 40% of sales are expected to be settled two months after the sale. - All purchases will be on credit. Suppliers will be paid in the month following purchase. - General expenses will be paid as incurred. - A bonus issue of 1 new ordinary share for every 3 held will be made on 1 December 2021. The directors propose that equal amounts are used from the company's capital reserves. - Non-current assets will be purchased on 1 November 2021 for RM17,000. Half of the cost will be paid on that date, the balance will be paid on 1 April 2022. - The non-current assets that cost RM20,000 will be sold in November 2021 for RM8,000. They will have been depreciated by RM11,000 at the date of sale. - The non-current assets are depreciated at 10% per annum on net book value at the balance sheet date. - Stock on 31 December 2021 was valued at RM2,000. Required: a. Prepare a forecast trading and profit and loss account and an appropriation account for the three months ending 31 December 2021 in as much detail as possible. b. Prepare a forecast balance sheet on 31 December 2021 in as much detail as possible
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