Adjustment on Profit or loss, closing inventory and receivables

The draft financial statements of Rampion for the year ended 31 December 20X6 included the following: $ Profit 684,000 Closing inventory. 116,800 Trade receivables. 248,000 Loss allowance for receivables. 10,000 No adjustments have yet been made for the following matters: (1) The company’s inventory count was carried out on 3 January 20X7 leading to the figure shown above. Sales between the close of business on 31 December 20X6 and the inventory count totaled $36,000. There were no deliveries from suppliers in that period. The company fixes selling prices to produce a 40% gross profit on sales. The $36,000 sales were included in the sales records in January 20X7. (2) In December 20X6 a customer ordered $10,000 of goods. These goods cost $6,000. Due to a clerical error the order was duplicated and goods were delivered and accounted for twice in December. On 10 January 20X7 the customer returned the goods in the second delivery in good condition. (3) Goods included in inventory at cost $18,000 were sold in January 20X7 for $13,500. Selling expenses were $500. (4) $8,000 of trade receivables are to be written off as irrecoverable. (5) The loss allowance for receivables is to be adjusted to the equivalent of 5% of the trade receivables after allowing for the above matters. Required: (a) Prepare a statement showing the effect of the adjustments on the company’s profit for the year ended 31 December 20X6. (b) Show how the adjustments affect: (i) Closing inventory; (ii) Receivables, showing separately the deduction of the loss allowance.