Reference no: EM132554212
Question - Andrew Joel is a market trader, he opened a business named Joel Co. The company's Trial balance as at 1 December 20X8, appears below:
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$
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Inventory
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5,000
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Equipment
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3,700
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Payables
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500
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Receivables
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300
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Cash at Bank
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1,200
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Capital
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?
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During December, Andrew Joel:
1. Transferred $300 of his savings into a business bank account.
2. Received loan from D. Watson, $100 cheque, repayable in 5 years.
3. Bought goods for resale on time, $320 from S. Holmes.
4. Bought a motor van by cheque, $500.
5. Goods returned to S. Holmes, $20.
6. Sold goods to AB Ltd valued $1,000, customer paid by cheque $400.
7. A Joel took goods from inventory for his own use, cost $220.
8. Sold motor van no longer required for $500 on credit to K. Lamb.
9. Purchased goods from C. Swiff $500, less 10% trade discount, pays by cheque.
10. Paid $120 to hire a van for December, using debit card.
11. Paid staff wages for December, $210 cheque.
Requires -
a. Calculating the balance of Capital account as at 1 December, 20X8.
b. Record all the transactions using double entries and ledger accounts (T-accounts).
c. Prepare Trial Balance as at 31 December 20X8.
d. Assuming that Inventory on 31 December 20X8 is $5,130. Prepare Income Statement for the period.
e. Prepare Balance Sheet as at 31 December 20X8.