SHORT QUESTIONS
Q001eng
The following are the account balances of Betty Lam’s business as at 31 December 2008. Draw up a statement of
financial position as at that date. (9 marks)
Capital as at 1 January 2008 $78,070
Furniture $46,500
Accounts receivable $20,900
Accounts payable $7,830
Bank $39,300
Drawings $14,200
Inventory at 31 December 2008 $24,000
Net profit for the year $59,000
1
Answer:
(Vertical style)
Betty Lam
Statement of financial position as at 31 December 2008 0.5
$ $
Non-current assets
Furniture 46,500 1
Current assets
Inventory 24,000 1
Accounts receivable 20,900 1
Ban 1
39,300
k
84,200
Less Current liabilities
Accounts payable 7,830 1
0.
Net current assets 76,370
5
122,870
Financed by:
Capital
Balance as at 1 January 2008 78,070 1
Add Net profit for the year 59,000 1
137,070
Less Drawings 14,200 1
2
122,870
Q002eng
The following are the account balances of Thomas Man’s business as at 31 July 2009. Draw up a statement of
financial position as at that date. (9 marks)
Accounts payable $4,240
Accounts receivable $11,350
Bank $21,314
Capital as at 1 August 2008 $72,843
Drawings $7,680
Inventory as at 31 July 2009 $12,975
Net profit for the year $3,206
Office equipment $26,970
3
Answer:
(Vertical style)
Thomas Man
Statement of financial position as at 31 July 2009 0.5
$ $
Non-current assets
Office equipment 26,970 1
Current assets
Inventory 12,975 1
Accounts receivable 11,350 1
Bank 21,314 1
45,639
Less Current liabilities
Accounts payable 4,240 1
Net current assets 41,399 0.5
68,369
Financed by:
Capital
Balance as at 1 August 2008 72,843 1
Add Net profit for the year 3,206 1
76,049
Less Drawings 7,680 1
68,369
4
Q003eng
The following are the account balances of Alex Chan’s business as at 31 October 2009. Draw up a statement of
financial position as at that date. (10 marks)
Capital as at 1 November 2008 ?
Motor vehicle $30,255
Accounts receivable $12,730
Accounts payable $7,460
Bank $23,900
Drawings $8,614
Inventory as at 31 October 2009 $14,555
Net profit for the year $35,990
Office equipment $62,430
5
Answer:
(Vertical style)
Alex Chan
Statement of financial position as at 31 October 2009 0.5
$ $
Non-current assets
Office equipment 62,430 1
Motor vehicle 30,255 92,685 1
Current assets
Inventory 14,555 1
Accounts receivable 12,730 1
Bank 23,900 1
51,185
Less Current liabilities
Accounts payable 7,460 1
Net current assets 43,725 0.5
136,410
Financed by:
Capital
Balance as at 1 November 2008 109,034 1
Add Net profit for the year 35,990 1
145,024
Less Drawings 8,614 1
136,410
6
Q004eng
Paul Lau trades as a stationery wholesaler. The following trial balance was extracted from his ledgers on 31
March 2010:
Dr Cr
$ $
Rent and rates 68,800
Purchases and sales 936,600 1,794,000
Office furniture 119,700
Inventory as at 1 April 2009 213,900
Carriage inwards 14,000
Accounts receivable and accounts payable 547,600 203,400
Bank 155,600
Capital as at 1 April 2009 891,800
Delivery van 134,600
Discounts 43,300 10,900
Returns 31,400 10,000
Sundry expenses 16,400
Wages and salaries 320,200
Van running expenses 55,300
Drawings 248,300
Cash 4,400
2,910,100 2,910,100
7
Inventory as at 31 March 2010 was valued at $185,000.
Required:
Draw up an income statement for the year ended 31 March 2010 and a statement of financial position as at that
date. (25 marks)
8
Answer:
(Vertical style)
Paul Lau
Income Statement for the year ended 31 March 2010 0.5
$ $ $
1,794,00 1
Sales
0
Less Returns inwards 31,400 1
1,762,60
Less Cost of goods sold:
Opening inventory 213,900 1
Add Purchases 936,600 1
Carriage inwards 14,000 1
950,600
Less Returns outwards 10,000 940,600 1
1,154,50
Less Closing inventory 185,000 969,500 1
Gross profit 793,100 1
Add Other revenues:
Discounts received 10,900 1
804,000
Less Expenses:
Rent and rates 68,800 1
Discounts allowed 43,300 1
Sundry expenses 16,400 1
Wages and salaries 320,200 1
Van running expenses 55,300 504,000 1
9
Net profit 300,000 0.5
10
Paul Lau
Statement of financial position as at 31 March 2010 0.5
$ $
Non-current assets
Office furniture 119,700 1
Delivery van 134,600 254,300 1
Current assets
Inventory 185,000 1
Accounts receivable 547,600 1
Bank 155,600 1
Cash 4,400 1
892,600
Less Current liabilities
Accounts payable 203,400 1
Net current assets 689,200 0.5
943,500
Financed by:
Capital
Balance as at 1 April 2009 891,800 1
Add Net profit for the year 300,000 0.5
1,191,800
Less Drawings 248,300 0.5
943,500
11
Q005eng
Candy Cho is a sole trader. The following trial balance was extracted from her books on 31 March 2009:
Dr Cr
$ $
Accounts receivable and accounts payable 575,020 294,090
Capital 374,370
Carriage inwards 3,000
Carriage outwards 3,420
Cash at bank 100,950
Cash in hand 17,300
Discounts allowed 28,530
Discounts received 37,310
Drawings 52,670
Electricity 8,770
Fixtures and fittings 10,970
Inventory as at 1 April 2008 256,780
Loan: Bill Chan (repayable in 2011) 131,680
Purchases 862,530
Rates 13,160
Rent 24,140
Repairs and maintenance 6,580
Returns outwards 13,160
12
Salaries 32,920
Sales 1,146,130
1,996,740 1,996,740
Inventory as at 31 March 2009 was valued at $10,000.
Required:
Draw up an income statement for the year ended 31 March 2009 and a statement of financial position as at that
date . (26 marks)
13
Answer:
Candy Cho
Income Statement for the year ended 31 March 2009 0.5
$ $ $
256,780 Sales 1,146,130 1, 1
Opening inventory
Add Purchases 862,530 1
Carriage 3,000 1
inwards
865,530
Less Returns 1
13,160 852,370
outwards
1,109,150
Less Closing 1
10,000
inventory
Cost of goods sold 1,099,150
Gross profit c/d 46,980 0.5
1,146,130
1,146,130
Gross profit b/d 1,
Carriage outwards 3,420 46,980
0.5
Discounts allowed 28,530 Discounts received 37,310 1, 1
Net loss 33,230 1,
Electricity 8,770
0.5
Rates 13,160 1
Rent 24,140 1
Repairs and 6,580 1
14
maintenance
Salaries 32,920 1
117,520 117,520
Candy Cho
Statement of financial position as at 31 March 2009 0.5
$ $ $ $
Non-current assets Capital
Balance as at 1 April 374,37 1, 1
Fixtures and fittings 10,970
2008 0
Less Net loss for the
33,230 0.5
year
Current assets Drawings 52,670 85,900 1
288,47
Inventory 10,000 1
0
Accounts receivable 575,020 1
Bank 100,950 Non-current liabilities 1
703,27 131,68 1, 1
Cash 17,300 Loan: Bill Chan
0 0
Current liabilities
294,09 1
Accounts payable
0
714,24 714,24
0 0
15
16
Q006eng Michael Lee, a sole proprietor, extracted the following trial balance from his books on
30 April 2010:
Dr Cr
$ $
Accounts payable 17,280
Accounts receivable 12,820
Advertising 9,840
Bank overdraft 6,200
Capital 475,470
Carriage inwards 2,820
Carriage outwards 2,090
Motor car 35,700
Drawings 102,960
Water and electricity 10,690
Insurance 7,850
Overdraft interest 280
Inventory as at 1 May 2009 39,790
Premises 318,760
Purchases 435,170
Rent revenue 20,660
Motor expenses 11,850
Returns outwards 9,970
17
Sales 565,950
Telephone and internet expenses 3,410
Returns inwards 1,500
Office equipment 100,000
1,095,530 1,095,530
Inventory as at 30 April 2010 was valued at $37,190.
Required:
Draw up an income statement for the year ended 30 April 2010 and a statement of financial position as at that
date (27 marks)
18
Answer:
Michael Lee
Income Statement for the year ended 30 April 2010 0.5
$ $ $
Sales 565,950 1
Less Returns inwards 1,500 1
564,450
Less Cost of goods sold:
Opening inventory 39,790 1
Add Purchases 435,170 1
Carriage inwards 2,820 1
437,990
Less Returns outwards 9,970 428,020 1
467,810
Less Closing inventory 37,190 430,620 1
Gross profit 133,830 1
Add Other revenues:
Rent revenue 20,660 1
154,490
Less Expenses:
Advertising 9,840 1
Carriage outwards 2,090 1
Water and electricity 10,690 1
Insurance 7,850 1
Overdraft interest 280 1
Motor expenses 11,850 1
Telephone and internet expenses 3,410 46,010 1
Net profit 108,480 0.5
19
Michael Lee
Statement of financial position as at 30 April 2010 0.5
$ $ $
Non-current assets
318,76 1
Premises
0
100,00 1
Office equipment
0
Motor car 35,700 454,460 1
Current assets
Inventory 37,190 1
Accounts receivable 12,820 1
50,010
Less Current liabilities
17,28
Accounts payable 1
0
Bank overdraft 6,200 23,480 1
Net current assets 26,530 0.5
480,990
Financed by:
Capital
Balance as at 1 May 2009 475,470 1
Add Net profit for the year 108,480 0.5
583,950
Less Drawings 102,960 0.5
480,990
20
21
Q007eng The following is a summary of Helen Wong’s bank account for the year ended
30 April 2008.
Bank
$ $
Balance b/f 311,911 Accounts payable 499,352
Accounts receivable 530,417 Salaries 67,168
Rent revenue 30,785 Telephone expenses 2,693
Bank interest revenue 7,696 Rent 9,235
Carriage outwards 19,240
Lighting and water charges 12,908
Drawings 17,071
Balance c/f 253,142
880,809 880,809
Additional information was available on 30 April 2008:
Sales $855,619
Purchases $463,249
Returns inwards $6,436
Office equipment $9,725
Accounts receivable $741,646
Accounts payable $32,744
Cash $37,082
22
Capital as at 1 May 2007 $734,650
Inventory as at 1 May 2007 $21,899
Inventory as at 30 April 2008 $31,974
Required:
Prepare for Helen Wong an income statement for the year ended 30 April 2008 and a statement of financial
position as at that date. (23 marks)
23
Answer:
(Vertical style)
Helen Wong
Income Statement for the year ended 30 April 2008 0.5
$ $ $
Sales 855,619 1
Less Returns inwards 6,436 1
849,183
Less Cost of goods sold:
Opening inventory 21,899 1
Add Purchases 463,249 1
431,27
Less Closing inventory 31,974 453,174 1
5
Gross profit 396,009 1
Add Other revenues:
Rent revenue 30,785 1
Bank interest revenue 7,696 38,481 1
434,490
Less Expenses:
Salaries 67,168 1
Telephone expenses 2,693 1
Rent 9,235 1
Carriage outwards 19,240 1
Lighting and water charges 12,908 111,244 1
Net profit 323,246 0.5
24
Helen Wong
Statement of financial position as at 30 April 2008 0.5
$ $
Non-current assets
Office equipment 9,725 1
Current assets
Inventory 31,974 1
Accounts receivable 741,646 1
Bank 253,142 1
Cash 37,082 1
1,063,844
Less Current liabilities
Accounts payable 32,744 1
Net current assets 1,031,100 0.5
1,040,825
Financed by:
Capital
Balance as at 1 May 2007 734,650 1
Add Net profit for the year 323,246 0.5
1,057,896
Less Drawings 17,071 0.5
1,040,825
25
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