Review questions 22.1 The Snencal year of S. Smith ended on 31 December 2016. Show the ledger accounts for the following items including the balance transferred to the necessary part of the financial statements, also the balances carried down to the next year: Motor expenses: Paid in 2016 £1,400; Owing at 31 December 2016 £200. (a) Insurance: Paid in 2016 £1,700; Prepaid as at 31 December 2016 £130. () (© Computer supplies: Paid during 2016 £900; Owing as at 31 December 2015 £300; Owing as at 31 December 2016 £400. (@) Business rates: Paid during 2016 £5,600; Prepaid as at 31 December 2015 £580; Prepaid as at 31 December 2016 £560. (e) Smith sublets part of the premises. He receives £3,800 during the year ended 31 December 2016. West, the tenant, owed Smith £380 on 31 December 2015 and £420 on 31 December 2016. 22.2A _W. Hope's year ended on 30 June 2020. Write up the ledger accounts, showing the transfers to the financial statements and the balances carried down to the next year for the following: stionery at 30 June 2019 £60; at (a) Stationery: Paid in the year to 30 June 2020 £240; Inventory of sta 30 June 2020 £95. (b) General expenses: Paid in the year to 30 June 2020 £470; Owing at 30 June 2019 £32; Owing at 30 June 2020 £60. Rent and business rates (combined account): Paid in the year to 30 June 2020 £5,410; Rent owing ance at 30 June 2020 £370; Business rates owing 30 June at 30 June 2019 £220; Rent paid in adv 5019 £191; Business rates owing 30 June 2020 £393. (a) Motor expenses: Paid in the year to 30 June 2020 £1,410; Owing as at 30 June 2019 £92; Owing as at 30 June 2020 £67. (e) Hope earns commission from the sales of one item. Received in the year to 30 June 2020 £1,100; Owing at 30 June 2019 £50; Owing at 30 June 2020 £82. © 22.3 On 1 January 2018 the following balances, among others, stood in the books of A. Cook, a sole proprietor: (a) Business rates, £600 (Dr); (b)_ Packing materials, £1,400 (D1). 353vara © nujoun During the year ended 31 December 2018 the information related to these two aceeyuny period 1 April 2018 to 31 March 2014 (Business rates of £6,200 were paid to cover the p (i) £4,000 was paid for packing materials bought; (ii) (900 was owing on 31 December 2018 in respec (iv) Old materials amounting to £300 were sold as scrap for £30 (Closing inventory of packing materials was valued at £7,400. 4 of packing materials bought on reds 10 cash, i. transferred ta th two accounts showing the appropriate amoun der You are required to write up the he end of the financial year of thet income statement at 31 December 2018, tI Note: Indivicual accounts are not opened for trade payables for packing materials bought an creas 22.4A On 1 January 2019 the following balances, among others, stood in the books of &. Barter (a) Lighting and heating, (Dr) £192. () Insurance, (Dr) £1,410. During the year ended 31 December 2019 the information related to these two accounts is (i) Fire insurance, £1,164 covering the year ended 31 May 2020 was paid. (i) General insurance, £1,464 covering the year ended 31 July 2020 was paid. (ii) An insurance rebate of £82 was received on 30 June 2019. (iv) Electricity bills of £1,300 were paid. (V)_ An electricity bill of £162 for December 2019 was unpaid as on 31 December 2015, (vi) Oil bills of £810 were paid. (vii) Inventory of oil as on 31 December 2019 was £205. for the year You are required to write up the accounts for lighting and heating, and for insurarice, to 31 December 2019. Carry forward necessary balances to 2020. 22.5 Three of the accounts in the ledger of Charlotte Williams indicated the following balance 1 January 2020: Insurance paid in advance £562; Wages outstanding £306; Rent receivable, received in advance £36. During 2020 Charlotte: Paid for insurance £1,019, by bank standing order; Paid £15,000 wages, in cash; Received £2,600 rent, by cheque, from the tenant. ‘At 31 December 2020, insurance prepaid was £245. On the same day rent receivable in a/r® £105 and wages accrued amounted to £419. e ‘are the insurance, wages and rent receivable accounts for the year ended 21 Decerr showing the year end transfers and the balances brought down. (b) Prepare the income statement extract showing clearly the amounts transferred from each of tH dbave accounts for the year ending 31 December 2020. e (o_ Explain the effects on the financial statements of accounting for (7 expenses accrued 24 Gi) income received in advance at year end. (a) What are the purposes of accounting for () expenses accrued and (if) income received in advan’ at year end? (a) Prep (Edexcel Foundation, London Examinations: GCSE)