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The following balances were taken from a sole trader’s accounts for the year ended 30 June 2018:
Current liabilities £20,000
Profit on sale of motor vehicle £4,000
Profit for the year £19,000
Capital account at 1 July 2017 £92,000
Non-current liabilities £10,000
Non-current assets £80,000No capital was introduced into the business or withdrawn during the year ended 30 June 2018.
Current assets at 30 June 2018 amounted to:
a) £50,000
b) £65,000
c) £42,000
d) £61,000The opening capital is 92,000, the profit is 19,000, and therefore the closing capital and the net assets at the end of the year are 111,000.
The total liabilities at the end of the year are 30,000, therefore the total assets at the end of the year are 141,000.
The non-current assets at the end of the year are 80,000 and therefore the current assets are 61,000.
(This is assuming that the profit for the year of 19,000 includes the profit on sale of 4,000. If the 19,000 is just the trading profit, then the total profit is 23,000 and the current assets are 65,000. The question as you have typed it does not make this clear.)
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