DETAILS DR CR Management Fees 50,000 Wages and Salaries 124,000 Insurance 18,000 Premises 600,000 Motor Vehicle 650,000 Provision for Depn on Motor Vehicle 70,000 Creditors 54,000 Interim Ordinary Shares Dividend 5,000 Cost of Sales 810,000 Closing Stock 230,000 6 % Debenture 200,000 Debenture Interest 7,000 General Reserves 65,000 Retained Earnings 20,000 Goodwill 200,000 Ordinary Share Capital @ $1 600,000 5 % Preference Share Capital @ 0.5 300,000 Sales Turnover 1,440,000 Debtors 55,000 Bank 40,000 2,769,000 2,769,000 End Notes Insurance is prepaid by 3,000. Wages and salaries is owing by 6,000 The goodwill should be written down by 30 % Provide for depreciation on motor vehicle at 10 % on the straight line The following items of expense should be apportioned ITEM OF EXPENSE Admin Sell & Dist. Insurance 70% 30% Wages & Salaries 60% 40% Management Fees 50% 50% Depreciation Charges 50% 50% Transfer $45,.000 from profits to the general reserves Corporation tax is estimated at $35,000 Prior to the end of the year the directors approved the payment of final ordinary shares dividends of 0.10 per share as well as the preference shares dividends Question Prepare (a) The Statement of Profit and Loss (b) The Statement of Change in Owners’ Equity

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter21: The Statement Of Cash Flows

Section: Chapter Questions

Problem 13P: Comprehensive The following are Farrell Corporations balance sheets as of December 31, 2019, and...

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Question

The Wind Jammers plc has provided the following data as at December 31, 2017

DETAILS	DR	CR
Management Fees	50,000
Wages and Salaries	124,000
Insurance	18,000
Premises	600,000
Motor Vehicle	650,000
Provision for Depn on Motor Vehicle		70,000
Creditors		54,000
Interim Ordinary Shares Dividend	5,000
Cost of Sales	810,000
Closing Stock	230,000
6 % Debenture		200,000
Debenture Interest	7,000
General Reserves		65,000
Retained Earnings	20,000
Goodwill	200,000
Ordinary Share Capital @ $1		600,000
5 % Preference Share Capital @ 0.5		300,000
Sales Turnover		1,440,000
Debtors	55,000
Bank		40,000
	2,769,000	2,769,000

End Notes

Insurance is prepaid by 3,000. Wages and salaries is owing by 6,000
The goodwill should be written down by 30 %
Provide for depreciation on motor vehicle at 10 % on the straight line
The following items of expense should be apportioned

ITEM OF EXPENSE	Admin	Sell & Dist.
Insurance	70%	30%
Wages & Salaries	60%	40%
Management Fees	50%	50%
Depreciation Charges	50%	50%

Transfer $45,.000 from profits to the general reserves
Corporation tax is estimated at $35,000
Prior to the end of the year the directors approved the payment of final ordinary shares

dividends of 0.10 per share as well as the preference shares dividends

Question

Prepare (a) The Statement of Profit and Loss

(b) The Statement of Change in Owners’ Equity

NOTE : The Statement of Financial Position is NOT Required

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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