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EX 2 - Financial statements for Naomi's Frames Naomi's Frames Trial balance as at 5 April 20X5 £ Trading account: Sales 295,000 Opening inventory 19,200 199,000 1,850 Purchases Carriage inwards Other revenue and expenses: Subscrip tion income Rent 1,200 15,500 4,000 Heating and lighting Advertising expense 2,500 4,450 1,600 Motor expenses Discounts allowed Carria ge outwards 1,100 Balance sheet accounts: Equipme nt Equipment - accumulated deprec iation 12,000 3,600 Motor vehicle 50,000 Motor vehic le - accumulated depreciation 12,250 Receivables 25,500 Allowance for receivab les 1,000 Bank 9,700 VAT liability Payables 17,350 16,800 10,000 17,500 Bank loan Capital Drawings 28,300 374.700 374,700 The following information is relevant. The closing inventory at 5 April 20X5 is valued at £18,200. 2 The subscription income of £1,200 received relates to the period from 6 August 20X4 to 5 August 20X5. 3 Depreciation on the equipment is provided at 10% per annum on the straight line basis. 4 Depreciation on the mot 1 vehicle is provided at 25% per annum on the reducing balance method. Naomi estimates that £1,100 due from customers will be irrecoverable and must be written off. 6 The allowance for receivables is to be set at 5% of net receivables at 5 April 20X5. Rent includes a prepayment of £3,000. 8 Advertising expense includes a prepayment of £500. The heating bill will arrive on 10 April and about £200 is expected to relate to the period 7 6 until 5 April. 10 The bank loan is repayable in 8 years' time. Interest payable on the loan is 9% and will be paid once per year. Required: 1. Prepare the income statement for Naomi's Frames for the period ended 5 April 20X5. 2. Prepare the balance sheet for Naomi's Frames as at 5 April 20X5 3. Present all your workings

EX 2 - Financial statements for Naomi's Frames Naomi's Frames Trial balance as at 5 April 20X5 £ Trading account: Sales 295,000 Opening inventory 19,200 199,000 1,850 Purchases Carriage inwards Other revenue and expenses: Subscrip tion income Rent 1,200 15,500 4,000 Heating and lighting Advertising expense 2,500 4,450 1,600 Motor expenses Discounts allowed Carria ge outwards 1,100 Balance sheet accounts: Equipme nt Equipment - accumulated deprec iation 12,000 3,600 Motor vehicle 50,000 Motor vehic le - accumulated depreciation 12,250 Receivables 25,500 Allowance for receivab les 1,000 Bank 9,700 VAT liability Payables 17,350 16,800 10,000 17,500 Bank loan Capital Drawings 28,300 374.700 374,700 The following information is relevant. The closing inventory at 5 April 20X5 is valued at £18,200. 2 The subscription income of £1,200 received relates to the period from 6 August 20X4 to 5 August 20X5. 3 Depreciation on the equipment is provided at 10% per annum on the straight line basis. 4 Depreciation on the mot 1 vehicle is provided at 25% per annum on the reducing balance method. Naomi estimates that £1,100 due from customers will be irrecoverable and must be written off. 6 The allowance for receivables is to be set at 5% of net receivables at 5 April 20X5. Rent includes a prepayment of £3,000. 8 Advertising expense includes a prepayment of £500. The heating bill will arrive on 10 April and about £200 is expected to relate to the period 7 6 until 5 April. 10 The bank loan is repayable in 8 years' time. Interest payable on the loan is 9% and will be paid once per year. Required: 1. Prepare the income statement for Naomi's Frames for the period ended 5 April 20X5. 2. Prepare the balance sheet for Naomi's Frames as at 5 April 20X5 3. Present all your workings

Corporate Financial Accounting
Corporate Financial Accounting
14th Edition
ISBN:9781305653535
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter5: Accounting For Merchandising Businesses
Section: Chapter Questions
Problem 5.6APR: Single-step income statement and balance sheet Selected accounts and related amounts for Clairemont...
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EX 2 - Financial statements for Naomi's Frames Naomi's Frames Trial balance as at 5 April 20X5 Trading account: Sales 295,000 Opening inventory 19,200 Purchases 199,000 Carria ge inwards Other revenue and expenses: 1,850 Subscrip tion income 1,200 Rent 15,500 4,000 Heating and lighting Advertising expense Motor expenses 2,500 4,450 Discounts allowed 1,600 Carriage outwards 1,100 Balance sheet accounts: Equipme nt Equipment - accumulated deprec iation 12,000 3,600 Motor vehicle 50,000 Motor vehic le - accumulated depreciation 12,250 Receivables 25,500 Allowance for receivab les 1,000 Bank 9,700 VAT liability Payables 17,350 16,800 10,000 Bank loan Capital Drawings 17,500 28,300 374,700 374,700 The following information is relevant. The closing inventory at 5 April 20X5 is valued at £18,200. The subscription income of £1,200 received relates to the period from 6 August 20X4 to 5 August 20X5. 3 Depreciation on the equipment is provided at 10% per annum on the straight line basis. 4 Depreciation on the motor vehicle is provided at 25% per annum on the reducing balance method. 1 2 Naomi estimates that £1,100 due from customers will be irrecoverable and must be written off. The allowance for receivables is to be set at 5% of net receivables at 5 April 20X5. Rent includes a prepayment of £3,000. 8 Advertis ing expense includes a prepayment of £500. The heating bill will arrive on 10 April and about £200 is expected to relate to the period 7 9 6 until 5 April. 10 The bank loan is repayable in 8 years' time. Interest payable on the loan is 9% and will be paid once per year. Required: 1. Prepare the income statement for Naomi's Frames for the period ended 5 April 20X5. 2. Prepare the balance sheet foòr Naomi's Frames as at 5 April 20X5 3. Present all your workings
Transcribed Image Text:EX 2 - Financial statements for Naomi's Frames Naomi's Frames Trial balance as at 5 April 20X5 Trading account: Sales 295,000 Opening inventory 19,200 Purchases 199,000 Carria ge inwards Other revenue and expenses: 1,850 Subscrip tion income 1,200 Rent 15,500 4,000 Heating and lighting Advertising expense Motor expenses 2,500 4,450 Discounts allowed 1,600 Carriage outwards 1,100 Balance sheet accounts: Equipme nt Equipment - accumulated deprec iation 12,000 3,600 Motor vehicle 50,000 Motor vehic le - accumulated depreciation 12,250 Receivables 25,500 Allowance for receivab les 1,000 Bank 9,700 VAT liability Payables 17,350 16,800 10,000 Bank loan Capital Drawings 17,500 28,300 374,700 374,700 The following information is relevant. The closing inventory at 5 April 20X5 is valued at £18,200. The subscription income of £1,200 received relates to the period from 6 August 20X4 to 5 August 20X5. 3 Depreciation on the equipment is provided at 10% per annum on the straight line basis. 4 Depreciation on the motor vehicle is provided at 25% per annum on the reducing balance method. 1 2 Naomi estimates that £1,100 due from customers will be irrecoverable and must be written off. The allowance for receivables is to be set at 5% of net receivables at 5 April 20X5. Rent includes a prepayment of £3,000. 8 Advertis ing expense includes a prepayment of £500. The heating bill will arrive on 10 April and about £200 is expected to relate to the period 7 9 6 until 5 April. 10 The bank loan is repayable in 8 years' time. Interest payable on the loan is 9% and will be paid once per year. Required: 1. Prepare the income statement for Naomi's Frames for the period ended 5 April 20X5. 2. Prepare the balance sheet foòr Naomi's Frames as at 5 April 20X5 3. Present all your workings
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