1. Ryder Sdn Bhd The following is the trial balance of Ryder Sdn Bhd at 31 December 2022. Dr Revenue Purchases Administration expenses Distribution expenses Motor vehicle Motor vehicle - Accumulated depreciation Inventory-1 January 2022 Trade receivables Allowance for receivables-1 January 2022 Bank Equity share capital Retained earnings-1 January 2022 Trade payables 9% Loan-repayable 1 January 2026 RM 144,000 112.000 44,800 120,000 26,400 28.800 4,000 480,000 Additional information: i) The current year tax charge has been estimated at RM2,000 i) It has been determined that trade receivable of RM500 are irrecoverable. Cr Required: For Ryder Sdn Bhd, prepare the followings: (1) Statement of profit or loss for the year ended 31 December 2022. Statement of Enancial portion se December 2022 RM 360.000 24.000 2,000 8.000 20.400 25.600 40,000 480.000 i) It was decided that the allowance for receivables should be increased by RM300 iv) The loan was taken out on 1 September 2022 and no interest has been accrued v) The closing inventory is RM18,000. vi) Prepaid administration expenses amount to RM3.000 and accrued administration expenses amount to RM5.000 vii) Motor vehicle is to be depreciated at 20% per annum
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
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