FA2 Sole Trader

The following additional information as at 30 Aug 2016 is available:

(a) Inventory as at the close of business has been valued at cost at 69,200.This inventory valuation includes some inventory costing of $8,000 and NRV $6,000.

(d) A credit controller advised you to create specific allowance by 10% for Mrs. Jane owed
$15,000 to Mr.Bill Steven. Then, the general allowance for receivable is to be adjusted so that 1% of the remaining trade receivables.

(f) Mr.Bill Steven has sold goods by $1,000 on sale and return basis on credit term. These goods have cost of $800. The customer has not sold these goods to third parties yet.

Required:
1. Do all necessary workings and adjustments?

BILL STEVEN
TRIAL BALANCE AS AT 30 AUGUST 2016
Property, at cost DR-150,000
Equipment, at cost DR- 90,000
Accumulated depreciation (as at 1 October 2015)
-on property CR-22,500
-on equipment CR-18,000
Purchases. DR-252,000
Revenue. CR-457,000
Inventory, as at 1 October 2015. DR-58,000
Discounts received. CR-3,900
Return out. CR-10,000
Wages & salaries. DR-62,000
Loan interest. DR-5,000
Other operating expenses. DR-19,880
Trade payables CR-63,000
Trade receivables DR-49,000
Cash in hand. DR-2,200
Bank. DR-49,000
Drawings. DR-25,000
Allowance for receivables. CR-750
10% long-term loan. CR-50,000
Capital as at 1 October 2015 CR-136,930
DR-762,080. CR-762,080.