PRACTICE QUESTION/TUTORIAL QUESTION 11:

Following Trial Balance was extracted from the books of JOJO Trading, a sole trader business
as at 30th September 2020
Debit (P) Credit (P)
Purchases 20 000
Salaries and Wages 8 000
Sales 45 000
Cash in hand 500
Capital 26 000
Discounts allowed 800
Interest on overdraft 1 500
Returns outwards 1 000
Discounts received 450
Carriage Inwards 1 200
Returns inwards 300
Bank overdraft 4 000
Rent, rates and Insurance 6 000
Furniture at cost 30 000
Provision for Depreciation: Furniture 5 000
Bad Debts 700
Accounts Receivable 16 000
Rent received from sub-letting 800
Carriage Outwards 1 500
Commission received 750
Long Term Loan 20 000
Drawings 2 000
Accounts Payable 2 000
st
Opening Inventory : 1 October 2019 6 500
Fixtures and Fittings at cost 15 000
Provision for Depreciation: Fixtures and Fittings 5 000
110 000 110 000

Additional Information:

1. Stock of Inventory as at 30th September 2020 was 4 500.

2. Wages accrued was P500.
3. Rates prepaid was P700.
4. Carriage outwards prepaid was P500.
5. Write off additional bad debts P300.

6. Rent accrued but not yet received was P300.

1
 7. Commission received in advance was P250
8. Depreciate Furniture by 10% per annum on Straight Line Method and Fixtures and
Fittings by 5% per annum on Reducing Balance Method.

Required:

a) Income Statement of JOJO Trading for the year ended 30th September 2020
b) Statement of Financial Position as at 30th September 2020

PRACTICE QUESTION/TUTORIAL QUESTION 12:

Following balances were extracted from the books of Mr. Richardson as at 31 st March 2020

Debit (P) Credit (P)

Long Term Loan 10 000
Cash in hand 6 000
Returns Inwards 8 000
Returns Outwards 2 000
Stock of Inventory : 1st April 2019 8 000
Discount allowed 600
Discounts received 1 100
Commission received 2 000
Bad debts 6 000
Office expenses 10 000
Rent and rates 14 000
Capital 100 000
Carriage Inwards 4 000
Sales 130 000
Purchases 40 000
Drawings 2 000
Motor Van at cost 40 000
Provision for Depreciation: Motor Van 10 000
Rent received from sub-letting 8 000
Accounts Receivable 20 000
Accounts payable 10 000
Carriage outwards 5 000
Furniture at cost 100 000
Provision for Depreciation: Furniture 20 000
Advertisement charges 4 000
Interest received on cash at bank 500
Salaries and Wages 18 000
Cash at Bank 8 000
293 600 293 600

2
 Additional Information:

1. Stock of Inventory on 31st March 2020 was P10 000.

2. Salaries prepaid was P1 000.
3. Rates accrued was P2 000.
4. Carriage inwards accrued was P1 000.
5. Commission received in advance was P1 000.
6. Rent from sub-letting accrued but not yet received was P2 000.
7. Create Provision (Allowance) for doubtful debts at 5% of Accounts Receivable.
8. The proprietor had taken goods worth P 1 000 for his personal use, but the transaction
is not yet recorded in the business books.
9. Depreciate Motor Van at 5% on Straight Line Method and Furniture at 10% per annum
on Reducing Balance Method.

Required to Prepare:

1. Income Statement for the year ended 31st March 2020.

2. Statement of Financial Position as at 31st March 2020.