Incomplete Records

Task One
James Smith who does not maintain double-entry records supplied the following information:
£ £
Creditors at 29 February 2004 16,500 Creditors at 28 February 2005 17,530
Debtors at 29 February 2004 31,810 Debtors at 28 February 2005 39,237
Year ended 28 February 2005
£
Cash received from debtors 219,000
Cash sales 41,900
Cash paid to creditors 108,470
Discounts allowed 1,900
Discounts received 745
Cash purchases 26,100
Sales ledger/Purchase ledger contra 2,500
Goods taken by the owner without payment 1,100
REQUIRED
(a) Calculate the value of both total sales and total purchases for the year ended 28 February 2005.

Task Two
On 1 September 2002, a motor vehicle (AB1) was purchased by Seacamp Ltd and an inspection of the
invoice for the transaction revealed the following information:
£
List price of vehicle (before deduction of trade discount of 20%) 20,000
Sign-writing the vehicle 3,600
Cost of delivering vehicle to firm's warehouse 200
Annual road fund licence 250
Fitting of internal racks 1,200
Full tank of petrol 75

On 1 July 2004, AB1 was sold and Seacamp Ltd received a cheque for £10,800. The depreciation policy
of the firm is to provide full years' depreciation in the year of purchase and to provide on a monthly
basis in the year of sale. All vehicles are depreciated straight line at 25% per annum and AB1 was
assumed to have a residual value of £6,600. Seacamp's year-end is 30 September.

REQUIRED
(b) Prepare a schedule showing the value of the delivery vehicle, which should have been capitalized
by the firm on 1 September 2002.
(c) Prepare the Asset Disposals account of Seacamp Ltd for the year ended 30 September 2004. No
other asset sales took place during the year.

Answer Guide: (a) Sales RM272,727; Purchases RM137,745 (b) RM21,000 (c) RM9,900