Trial Balance of Mr. Tang on 31st December 2021

	RM		RM
Sales revenue			590,000
Purchases	355,000
Inventory at 01/01/2021	35,000
Salaries	82,000
Postage and stationery	2,000
Telephone	1,500
Directors fees	35,000
Rent and rates	21,000
Insurance	13,000
Office heat and light	5,000
Legal fees	12,000
Buildings (cost)	200,000
Plant and Machinery (cost)	60,000
Motor Vehicles (cost)	68,000
Provision for depreciation of buildings			32,000
Provision for depreciation of plant and machinery			34,000
Provision for depreciation of motor vehicles			15,000
Trade receivables	29,000
Trade payables			14,000
Provision for doubtful debts Capital			3,000 10,500
6% Loan account 1			50,000
Loan account 2			160,000
Bank overdraft			10,000
	918,500		918,500

You are given the following information

a) Inventory at 31/12/2021 was valued at RM40,000

b) Provide for depreciation as follows:

Buildings, 2% of book value(reducing balance)

Plant and machinery, 10% of cost

Motor vehicles, 20% of cost

c) Provide for legal fees outstanding of RM4,000

d) Telephone accrued is RM500

e) It is agreed that provision for doubtful debt should increase by RM1,000.

Required:

Task 1: Prepare the journal entries for adjustments (b) to (e) mentioned in the additional information

Task 2: Prepare the adjusted trial balance on 31st December 2021

Task 3:Prepare the Statement of Profit and Loss for the year ending 31stDecember 2021(after adjustments)

Task 4:Prepare the Statement of Financial Position as at 31st December (after adjustments)

Task 5: Provide TWO (2) explanations on the importance of the Statement of Profit and Loss and Statement of Financial Position to the users of the accounting information. Your answer should include the explanation on how these TWO (2) statements help the users in making decision.