trial balance

John owns a small business selling coffee makers to other businesses. On 31st December 2019 he extracted the following trial balance.

Account Name	Debit $	Credit $
Sales Revenue		902,148
Sales returns	6,864
Opening inventory	122,742
Purchases	494,814
Purchase returns		4,428
Freehold property	304596
Equipment at cost	45,900
Accumulated depreciation on equipment		8,400
Motor vehicle	63,000
Accumulated depreciation on motor vehicle		14,100
Salaries and Wages	19,440
Insurance	4,200
Motor expenses	6,600
Advertising expenses	4,884
Loan interest	7,800
Receivables	94,560
Allowance for receivables		5,076
Payables		86,112
Cash at bank	162,864
Bank loan		74,400
Capital		243,600
Total	1,338,264	1,338,264

The following information is relevant.

1. Closing inventory was valued at $127,728.

2. Equipment is depreciated by 10% on Straight line basis.

3. Motor vehicles are depreciated by 20% on reducing balance basis.

4. Accrued wages at the end of 2019 amount to $4,020.

5. On 1 November 2019 Johns paid $1,800 for insurance which is valid until 31 October 2020.

6. Irrecoverable receivables of $3,000 need to be written off.

7. John decides to increase the allowance for receivable for $6,276.

8. John has taken goods worth $5,400 for his own use.

Required:

a. Prepare John’s income statement for the year ending 31st December 2019.

b. Prepare John’s balance sheet as at December 2019. EFFICIENTLY ORDER A 5 STAR COLLEGE TERM PAPER NOW Answer 2 Scenario Questions Accurately Now