Question 5 Percy Bazaar did not keep proper accounting records. She asked you to
ID: 2331760 • Letter: Q
Question
Question 5
Percy Bazaar did not keep proper accounting records. She asked you to review this informatio from her records.
ASSETS AND LIABILITIES:
31 Dec. 2018
31 Dec. 2019
Property, Plant & Equipment
40 000.00
40 000. o
Accounts receivable
10 000.00
30 000.00
Accounts payable
30 000.00
36 000.00
Accrued expense ( Telephone & internet)
0.00
6 000.00
Bank
30 000.00
30 000.00
Cash
4 000.00
2 000.00
Inventory
40 000.00
20 000.00
Capital
0.00
17 ooo.op
Long term loan ( Deutsche Bank)
60 000.00
60 000.00
The following expenses were paid during the year:
Telephone & internet N$ 8 000.00 paid by cheque.
Sundry expenses N$ 18 000.00 paid by cheque.
Telephone & internet paid by cash N$ 2 000.00.
Drawings N$ 10 000.00 by cash.
The bank statement from First National Bank Namibia indicated that:
There was N$ 50 000.00 paid b receivables and banked immediately.
Percy Bazaar received N$ 10 000 cash from one of the receivables. Payables were paid N$ 24 000.00 by cheque during the year.
You are required to:
5.1 Prepare the following General ledger accounts ( T- accounts) and balance them off properly:
Accounts receivable
[6 Marks]
Accounts Payable
[5 Marks]
5.2 Mention any two features of incomplete records.
[2 Marks]
31 Dec. 2018
31 Dec. 2019
Property, Plant & Equipment
40 000.00
40 000. o
Accounts receivable
10 000.00
30 000.00
Accounts payable
30 000.00
36 000.00
Accrued expense ( Telephone & internet)
0.00
6 000.00
Bank
30 000.00
30 000.00
Cash
4 000.00
2 000.00
Inventory
40 000.00
20 000.00
Capital
0.00
17 ooo.op
Long term loan ( Deutsche Bank)
60 000.00
60 000.00
Explanation / Answer
End of content.
Total Liabilities at 31 dec 2019 Salaries payable 34000 Accounts payable 52000 Notes Payables 94000 180000 Total Equity at 31 dec 2019 = 70% of Total Liabilities at dec 31 ,2019 =70% *180,000 =$126000 Retained earnings at dec 31 ,2019 = Total Equity - Common stock =$126000 - 70,000 =$56000 Income Earned During the year Sales 97000 Less: Cost of goods Sold -40000 Gross profit 57000 Add: Interest Revenue 12000 Less: Other Expenses Salaries expense -32000 Suplies Expenses -10000 net Incomre 27000 Income tax Expense -10000 Income after Tax 17000 Dividend Paid During the year = Opening retained earings + Income after tax - Closing retained Earnings Dividend Paid During the year = $40,000 +$17000 -56000 =$1000Related Questions
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