Q No.

1 FINANCE FOR MANAGERS

Q No.1 Following Trial balance and adjustment data is presented by Saleem , a sole-
trader at the end of its financial year Dec.31,2012.

TITLE OF ACCOUNT DEBIT CREDIT

CASH 105,000
A/C RECEIVABLE 20,000
EQUIPMENT 132,800
ADVERTISING EXPENSE 3,000
PREPAID RENT 6,000
MISCELLANEOUS EXPENSE 2,000
OFFICE SUPPLIES EXPENSE 1,000
INTEREST EXPENSE 500
MDS. INVENTORY 7,000
COST OF GOODS SOLD 25,100
CARRIAGE OUTWARD 200
SALES RETURN 900
SALARIES EXPENSE 8,000
SALES REVENUE 240,000
COMMISSION UNEARNED 800
INTEREST INOCME 400
COMMISSION INCOME 2,500
A/C PAYABLE 5,500
CAPITAL-SALEEM 39,800
NOTE PAYABEL 5,000
BANK OVERDRAFT 7,500
LONG-TERM LOAN 10,000
TOTAL 311,500 311,500

ADJUSTMENT DATA ON DEC.31,2002:

 Depreciation on equipment 2%
 Tax rate is applied 20%

INSTRUCTION
1. MULTIPLE STEP INCOME STATEMENT showing EBIT and EAT
2. BALANCE SHEET in classified form.
 Q No.2 Saleem provided following Trial Balance on December 31, 2012 and adjustment
data.

TITLE OF ACCOUNT DEBIT CREDIT

CASH 45,000
A/C RECEIVABLE 175,000
OFFICE EQUIPMENT 325,000
MARKETING EXPENSE 12,500
PREAPID ADVERTISING 8,500
OTHER EXPENSE 6,000
OFFICE SUPPLIES EXPENSE 3,500
INTEREST EXPENSE 16,000
MDS. INVENTORY-BEGINNING 27,800
PURCHASES 275,000
TRANSPORTATION-IN 22,000
SALES RETURN 12,000
SALARIES EXPENSE 65,000
SALES REVENUE 575,000
PURCHASES RETURN 1800
PURCHASES DISCOUNT 4500
INTEREST INCOME 27,000
A/C PAYABLE 35,000
CAPITAL-SALEEM 222,300
SHORT-TERM LOAN 55,000
BILL PAYABLE 22,700
LONG-TERM LOAN 50,000
TOTAL 993,300 993,300

ADJUSTMENT DATA:

1. Mds.inventory ending Rs.45,000

2. Depreciation on office equipment Rs.22,500
3. Bad debts expense 5% of A/c receivable
4. Tax rate is 2% applied

Required:
1. Multiple step Income Statement showing EBIT and EAT
2. Balance Sheet classified form

Q No.3
 AUSTIN SOUND SEREO CENTER, INC.
TRIAL BALANCE
DECEMBER 31,2012
TITLE OF ACCOUNT DEBIT CREDIT
Cash 110,350
Account receivable 54600
Note receivable 8000
Interest receivable - -
Inventory-opening 40,500
Supplies 650
Prepaid insurance 1200
Furniture and Fixture 183,200
Accumulated depreciation-furniture 2400
Account payable 47,000
Note payable (long-term) 12,600
Capital-Frank 100,000
Sales revenue 338,000
Sales discount 1400
Sales return and allowance 2000
Interest revenue 600
Purchases 89,300
Purchases discount 3000
Purchases return and allowances 1200
Freight in 5200
Rent expense 8400
TOTAL 504,800 504,800

ADJUSTMENT DATA:
1. Depreciation for the year $ 600
2. Inventory on hand at the end of the year $ 42,000
3. Tax rate is 40% applied

INSTRUCTIOS:
 Work sheet
 Multiple step Income Statement showing EBIT and EAT
 Classified Balance Sheet