Question
The trial balance of HT Pte Ltd (HT) as at 31 December 20X1 is as follows: Trial Balance Debit Credit Account Title S$ S$ Cash
The trial balance of HT Pte Ltd (HT) as at 31 December 20X1 is as follows:
Trial Balance
| Debit | Credit |
Account Title | S$ | S$ |
Cash | 82,700 |
|
Accounts receivable | 53,200 |
|
Inventory | 34,250 |
|
Purchase | 54,000 |
|
Prepaid maintenance | 2,400 |
|
Building | 1,200,000 |
|
PPE | 300,000 |
|
Accumulated depreciation - PPE |
| 90,000 |
Short term notes payable |
| 20,000 |
Interest payable |
| 600 |
Unearned revenue |
| 20,800 |
Share capital |
| 1,000,000 |
Retained earnings |
| 231,000 |
Revenue |
| 563,800 |
Salaries expense | 110,000 |
|
Supplies expense | 5,700 |
|
Depreciation expense | 30,000 |
|
Transport expense | 44,000 |
|
Utilities expense | 4,030 |
|
Telephone expense | 5,320 |
|
Interest expense | 600 |
|
| 1,926,200 | 1,926,200 |
Other information at 31 December 20X1 included the following:
(i) In December 20X1, HT performed a service for a customer amounting to $5,690, but the transaction was not yet recorded.
(ii) The prepaid maintenance of $2,400 was paid in cash on 1 July 20X1 to cover the maintenance of the office for 12 months with effect from 1 July 20X1.
(iii) A customer walked into the store during December 20X1 and paid cash of $4,000 for a job to be performed in the next month. The account clerk recorded the transaction as Debit Cash and Credit Revenue.
(iv) During December 20X1, the company came to know that one of its customers was bankrupt and the amount of $2,000 owed to the company would not be collected. This fact has not been accounted for. The company adopted the direct write-off method.
(v) The account clerk had yet to accrue for current income tax liability amounting to $7,600.
(vi) HT adopted a periodic inventory system. A stock count was done and the inventory at year end was $33,000.
Required:
(a) For each of the points (i) to (vi) above, apply the accrual accounting concepts by passing the necessary adjusting or additional journal entries (journal narrative not required) for the year ended 31 December 20X1.
(b) Prepare the Statement of Financial Position for HT Pte Ltd as at 31 December 20X1, incorporating all the necessary adjustments as given in the additional information.
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