Karl Ward imports and sells furniture. The following balances were extracted from his bookson 30 September 2005.SalesStock at 1 October 2004137 9006.90041 200PurchasesCarriage inwardsCarriage outwardsWages and salariesInsurance9 4001.30034 7001.800Rent and rates paid10 800Motor vehicle expenses4 200General expenses22 850Discounts receivedBank overdraft800700Motor vehicles at costProvision for depreciation ofmotor vehicles at 1 October 2004Trade creditorsDrawingsCapital at 1 October 2004Additional information32 00016 0003 14017.69024 300182 840182 8401. Stock at 30 September 2005 was valued at $7500.2. During the year Karl Ward took goods costing $4300 for his own use. No entries havebeen made in the books.3.Depreciation is to be charged on the motor vehicles using the diminishing (reducing)balance method at 50% per annum.4. Wages and salaries, $6800, were owing at 30 September 2005.5.The amount for insurance represents insurance cover for the 18 month period from1 October 2004 to 31 March 2006.REQUIREDa) Prepare the Income Statement for the year ended 30 September 2005b) Prepare a balance sheet as 30 September 2005, clearly showing theworking capital.

Summary of Financial Statements Preparation and Analysis for Karl Ward's Furniture BusinessIncome…

Answered: Karl Ward imports and sells furniture.…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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. Bryan is a retailer whose Trial Balance at 2020 December 31 is given below:DR CR$ $Purchases and Sales 72 000 119 400Returns 750Carriage Inwards 930Wages and Salaries 27 670General Expenses 4 750Cash at Bank 4 210Cash in Hand 150Premises 62 520Fixtures and Fittings 9 000Inventory at 2020 January 01 5 550Accounts Receivable and Payable 7 200 4 850Motor Vehicle at cost 13 150Provision for Depreciation onMotor Vehicle at 2020 January 01 2 630Capital at 2020 January 01 82 500Drawings 3 000---------- ----------210 130 210 130====== ======The following additional information is available:1. Inventory at 2020 December 31 was valued at $5 200.2. General Expenses of $400 paid for the year 2021.3. A debt of $200 is to be written off as bad.4. Provision is to be made for doubtful debts of 5% on Accounts Receivables (after writing offthe Bad Debt of $200) at 2020 December 31.5. Depreciation is to be provided for 2020 as follows:Fixtures and Fittings at 10% using the straight -line method; Motor…
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