December, 2022
Dr
Cr
Issued and fully paid 30,000 Ordinary shares of N1 each
30,000
Share premium
5,000
Revenue reserve
4,000
General reserve
Salaries and wages
Discounts
Carriage inwards
7,000
6,000
200
400
1,160
Purchases and sales
45,000
78,740
Inventory as at 1st January
8,000
8
Carriage outwards
560
5% Debenture
12,000
Debenture Interest
600
Allowance for doubtful debts
2,400
Motor vehicle expenses
3,100
Directors remuneration
4,000
Repairs
1,250
Rates
1,600
Land and Building at cost
20,000
Motor vehicle at cost
13,000
Plant and machinery at cost
25,000
Provision for depreciation: Plant and machinery
2,500
Receivables & Payables
9,290
7,600
Sundry expenses
1,500
Cash in hand
2,500
Cash at bank
7,000
Returns
240
150,000
360
150,000
Additional Information
i. Inventory at 31st December 2022, N412, 500
ii. Accrued Expenses: Motor expenses N400
Insurance N450
Sundry expenses N200
iii. Prepaid expenses:
Rates N320
Sundry expenses N250
iv. Allowance for doubtful debts to be increased to N2, 800.
v. Irrecoverable debts as at 31st December N600
vi. Provide for depreciation using straight line basis:
Land and Building 20% on cost
Plant and machinery 25% on cost
Motor vehicles 10% on cost
vii. Transfer N7,000 to general reserves and N3,000 to revenue reserve.
Required: Prepare
a) Income Statement for the year ended 31st December, 2022.
b) Statement of changes in Equity
c) Statement of Financial Position as at that date
9