At the adjustments: end of the month, you are also required to take into consideration the following (a) Non-current assets are to be depreciated at the rate of 0.5% per month. (b) Allowance for doubtful debt is set at a rate of 1% on accounts receivable balance. (c) Electricity and water bill for the month of January 2020 is still accrued. (d) Insurance for the month of February 2020 is paid in advance. (e) Closing inventory of fuel saving oil amounted to 10% of purchases account balance. On 31 January 2020, you are required to balance all the accounts and prepare the following: (a) Trial Balance as at 31 January 2020 (b) Statement of Profit or Loss for the month ended 31 January 2020 (c) Statement of Financial Position as at 31 January 2020
At the adjustments: end of the month, you are also required to take into consideration the following (a) Non-current assets are to be depreciated at the rate of 0.5% per month. (b) Allowance for doubtful debt is set at a rate of 1% on accounts receivable balance. (c) Electricity and water bill for the month of January 2020 is still accrued. (d) Insurance for the month of February 2020 is paid in advance. (e) Closing inventory of fuel saving oil amounted to 10% of purchases account balance. On 31 January 2020, you are required to balance all the accounts and prepare the following: (a) Trial Balance as at 31 January 2020 (b) Statement of Profit or Loss for the month ended 31 January 2020 (c) Statement of Financial Position as at 31 January 2020
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter6: Cash And Receivables
Section: Chapter Questions
Problem 13GI
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At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
Question
At the adjustments:
end of the month, you are also required to take into consideration the following
(a) Non-current assets are to be depreciated at the rate of 0.5% per month.
(b) Allowance for doubtful debt is set at a rate of 1% on accounts receivable
balance.
(c) Electricity and water bill for the month of January 2020 is still accrued.
(d) Insurance for the month of February 2020 is paid in advance.
(e) Closing inventory of fuel saving oil amounted to 10% of purchases account
balance.
On 31 January 2020, you are required to balance all the accounts and prepare the
following:
(a) Trial Balance as at 31 January 2020
(b) Statement of Profit or Loss for the month ended 31 January 2020
(c) Statement of Financial Position as at 31 January 2020
Transcribed Image Text:Adjusted Trial
Statement of Profit
Statement of
Account Titles
Trial Balance
Adjustment
Balance
or
Financial
Los
Position
Dr
Cr
Dr
Cr
Dr
Cr
Dr
Cr
Dr
Cr
Purchase
15,000
Sales
9,900
Bank
Capital
CIB Bank
|ВB Bank
Cash
Drawings
SSB Bank
26,032
4,600
20,000
5,000
6,222
400
1,372
Carriage Outwards
Salary
200
800
200
Insurance
Electricity Bill
Water Bill
Discount Allowed
Discount Received
Account Payable
Account Receivable
Return Inwards
Return Outwards
100
50
28
60
10,500
3,360
140
300
Total
52,132
52,132
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