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Question 8 - Preparation of FS

The document is a trial balance for Sipho Suppliers as at 28 February 2016. 1. It provides a statement of comprehensive income for the year ended 28 February 2016 showing sales of R360,050, cost of sales of R81,550, gross profit of R278,500, other income of R15,600 and operating expenses of R57,120 resulting in a net profit of R236,980. 2. It provides a statement of financial position as at 28 February 2016 showing total assets of R585,869 consisting of non-current assets of R495,000 and current assets of R90,869, total equity and liabilities of R585,

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620 views4 pages

Question 8 - Preparation of FS

The document is a trial balance for Sipho Suppliers as at 28 February 2016. 1. It provides a statement of comprehensive income for the year ended 28 February 2016 showing sales of R360,050, cost of sales of R81,550, gross profit of R278,500, other income of R15,600 and operating expenses of R57,120 resulting in a net profit of R236,980. 2. It provides a statement of financial position as at 28 February 2016 showing total assets of R585,869 consisting of non-current assets of R495,000 and current assets of R90,869, total equity and liabilities of R585,

Uploaded by

Rax-Nguajandja Kapuire
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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QUESTION 8

TRIAL BALANCE OF SIPHO SUPPLIERS AS AT 28 FEBRUARY 2016


Debit Credit
Capital 295 189
Land and buildings 250 000
Accounts receivable 58 200
Accounts payable 49 200
Bank overdraft 17 500
Vehicles 145 000
Furniture at cost 100 000
Purchases 71 900
Railage on purchases 7 150
Railage on sales 2 750
Inventory (1/03/2015) 37 000
Sales returns 4 950
Purchase returns 6 000
Discount received 3 600
Rent received 12 000
Telephone 6 820
Sales 365 000
Wages 40 000
Insurance 3 500
Advertising 4 050
Drawings 13 000
Petty cash 4 169
R748 489 R748 489

Inventory as at 28 February 2016 was valued at R28 500.

REQUIRED

a. Prepare the Statement of Comprehensive Income for the year ended 28


February 2016.
b. Prepare the Statement of Financial Position as at 28 February 2016.
c. Prepare the Statement of Changes in Equity.

a.

SIPHO SUPPLIERS

Chapter 4 1
STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 28
FEBRUARY 2016

Sales (365 000 – 4 950) 360 050

Less: Cost of sales 81 550

Opening inventory 37 000

Purchases (71 900 – 6 000) 65 900

Railage-in 7 150

Less: Closing inventory (28 500)

Gross profit 278 500

Add: Other income 15 600

Discount received 3 600

Rent received 12 000

Less: Operating expenses 57 120

Railage on sales 2 750

Telephone 6 820

Wages 40 000

Insurance 3 500

Advertising 4 050

Net profit 236 980

b.

STATEMENT OF FINANCIAL POSITION AS AT 28 FEBRUARY

Chapter 4 2
Notes:

Assets: R

Non-current assets 495 000

Land and buildings 250 000

Vehicles 145 000

Furniture 100 000

Current assets 90 869

Inventory 28 500

Accounts receivable 58 200

Petty cash 4 169

TOTAL ASSETS 585 869

Equity and liabilities:

Owner’s equity 1. 519 169

Current liabilities 66 700

Accounts payable 49 200

Bank overdraft 17 500

TOTAL EQUITY AND LIABILITIES 585 869

NOTE 1: see answer c. below

c.

STATEMENT OF CHANGES IN EQUITY

Chapter 4 3
Capital 295 189

Profit 236 980

Drawings (13 000)

519 169

Chapter 4 4

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