workout retained profit and 1- Prepare a worksheet outlining the transactions of
ID: 2487209 • Letter: W
Question
workout retained profit and
1- Prepare a worksheet outlining the transactions of HIGH Energy Ltd in February and March 2016. Ignore tax.(Your worksheet should include the initial balances and the adjustments where necessary according to the additional information collected)
2.Prepare an income statement for the period from 1 February to 31 March 2016;
3.Prepare a classified balance sheet as at 31 March 2016;
4.Prepare a classified cash flow statementor the period from 1 February to 31 March 2016
Explanation / Answer
Account Title Debit Credit 01-Feb Insurance Expense 160000 Pre-paid Insurance 800000 Cash 960000 03-Feb Cash 18375500 Share Capital 18375500 09-Feb Cash 260600 Accounts Receivables 760600 Service Revenue 1021200 12-Feb Cash 42510325 Accounts Receivables 42510325 15-Feb Accounts Payables 877500 Salaries & Wages 877500 Cash 1755000 22-Feb Accounts Payables 789620 Cash 789620 26-Feb Advertising expense 330000 Accounts Payables 330000 28-Feb Salaries & Wages 877500 Accounts Payables 877500 01-Mar Equipment 8017200 Accounts Payables 8017200 04-Mar Accounts Receivables 509200 Sales 509200 04-Mar COGS 460800 Inventory 460800 09-Mar Cash 760600 Accounts Receivables 760600 15-Mar Accounts Payables 877500 Salaries & Wages 877500 Cash 1755000 19-Mar Accounts Receivables 9345600 Sales 9345600 22-Mar Accounts Payables 330000 Cash 330000 31-Mar Interest on Bank Loan 450500 Cash 450500 31-Mar Depreciation 202000 Accumulated Depn.PP&E 202000 31-Mar Depreciation 30000 Accumulated Depn.PP&E 30000 (8017200-817200)/20/12*1 31-Mar Salaries & Wages 877500 Accounts Payables 877500 Adjusted Trial Balance as on 31 st March Insurance Expense 160000 Salaries & Wages 2632500 Advertising expense 330000 COGS 460800 Interest on Bank Loan 450500 Depreciation 202000 Depreciation 30000 Service Revenue 1021200 Sales Revenue 9854800 Prepayments 86490000 Accounts Receivables 55399633 Cash 128166905 Pre-paid Insurance 800000 Equipment 982835200 Inventory 190539200 Share Capital 933925500 Accounts Payables 73250192 Bank loan 356800000 Retained Earnings 73645046 1448496738 1448496738 Income Statement for 2 mths. Ended 31st Mar Sales Revenue 9854800 Less:COGS 460800 Gross Profit 9394000 Service revenue 1021200 10415200 Less: Expenses: Insurance Expense 160000 Salaries & Wages 2632500 Advertising expense 330000 Interest on Bank Loan 450500 Depreciation 232000 3805000 Net Income 6610200 Balance Sheet as on 31st March Assets Current Assets Cash 128166905 Prepayments 87290000 Accounts Receivables 55399633 Inventory 190539200 Fixed Asset(Net) Equipment 982835200 Total Assets 1444230938 Liabilities & Equity Liabilities Accounts Payables 73250192 Bank loan 356800000 Equity Share Capital 933925500 Retained Earnings 80255246 Total Liabilities& Equity 1444230938 Cash Flow Statement Operating Activities Net Income as per Income Statement 6610200 Add: Non-cash exp.-Depn. 232000 6842200 Add: Decrease in AccRec. 32655525 Add: Decrease in Inv.. 460800 Add: Inc.in Acc. Pay. 6350080 Less: Increase in Prepaid Ins. -800000 Cash generated by Operating activities 45508605 Investing Activities Cash Used- Purchase of Equipment -8017200 Finacing Activities Cash Generated-Sh. Cap. 18375500 Net cash generated 55866905 Add: Opening Balance 72300000 Ending Balance 128166905
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