Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FA – FIA FFA › can you help pls
- This topic has 1 reply, 2 voices, and was last updated 4 years ago by John Moffat.
- AuthorPosts
- March 23, 2020 at 10:36 am #565564AnonymousInactive
- Topics: 3
- Replies: 0
- ☆
Jordan Ltd. is a new business that started trading on 1 January 2018. You have recently been appointed as an accountant and have been presented with the following summary of transactions that have occurred during the first year of trading:
1) The owners introduced £500,000 of equity, which was paid into a bank account opened in the name of the business.
2) Premises were rented from 1 January 2018 at an annual rate of £80,000. During the year, rent of £120,000 was paid to the owner of the premises.
3) A delivery van was bought on 1 January 2018 for £60,000. This is expected to be used in the business for five years and then to be sold for £8,500.
4) Rates (a tax on business premises) were paid during the year as follows:
For the period 1 January 2018 to 31 March 2018 £1,500
For the period 1 April 2018 to 31 March 2019 £6,000
5) Electricity bills for the first three quarters of the year were paid totalling £3,800. After 31 December 2018, but before the financial statements had been finalised for the year, the bill for the last quarter arrived showing a charge of £1,200.
6) Wages totalling £115,000 were paid during the year. At the end of the year, the business owed £12,400 of wages for the last week of the year.
7) Sales revenue on credit totalled £526,000 (cost of sales £181,000).
8) Cash sales revenue totalled £88,000 (cost of sales £32,000).
9) Inventories totalling £380,000 were bought on credit.
10) Inventories totalling £75,000 were bought for cash.
11) Receipts from trade receivables totalled £325,000.
12) Payments to trade payables totalled £206,000.
13) The delivery van travelling expenses paid totalled £68,000.
At the end of the year it was clear that a credit customer (trade receivables) who owed £5,100 would not be able to pay any part of the debt. All of the other trade receivables were expected to settle in full.
The business uses straight-line depreciation for non-current assets.March 23, 2020 at 12:06 pm #565569Unless you have been set this as a test question (and we are not here to provide answers to test questions) then you must have an answer in the same book in which you found the question.
If you ask about whatever it is in the answer that you are not clear about, then I will explain.Everything needed to be able to answer this question is explained in detail in my free Paper FA lectures – they are a complete free course and cover everything needed to be able to pass the exam well.
- AuthorPosts
- The topic ‘can you help pls’ is closed to new replies.