Roger’s business trades in water coolers for offices. At the end of his trading year to 31 December 2021 he has 212 coolers in inventory. 96 of them are the deluxe model which costs Roger £156 to purchase from the manufacturer. The remainder cost £128 each. The business is run from rented warehouse premises. Roger supplies you with the following trial balance: Trade payables 30 729 Sundry expenses 2 678 Warehouse rental 12 629 Sales representative’s car 15 900 Long-term loan 5 000 Capital at 1 January 2021 26 679 Business rates 1 920 Revenue 313 475 Accumulated depreciation- Sales Car 4,770 Accumulated depreciation-Warehouse fixtures 182 Cash at bank 1 826 Water rates 850 Drawings 18 214 Sales representative’s salary 26 241 Administration expenses 3 122 Purchases of water coolers 233 668 Trade receivables 32 635 Telephone 2 961 Travelling expenses 1 820 Loan interest 250 Insurance 1729 Inventory at 1 January 2021 25 620 Warehouse fixtures 1 820 a. Depreciation is calculated at 30% on the reducing balance basis for the Sales representative car. b. Depreciation is calculated on the straight-line basis at 10% of cost for the Warehouse fixture c. Accruals are also required for telephone charges -£686 d. Included in the administrative expense is £150 for professional fees and subscriptions total is to be treated as a prepayment. Also, £750 of the insurance relates to the next following accounting period. Prepare an income statement and statement of financial position for Roger for the year ended 31 December 2021
Roger’s business trades in water coolers for offices. At the end of his trading year to 31 December
2021 he has 212 coolers in inventory. 96 of them are the deluxe model which costs Roger £156 to
purchase from the manufacturer. The remainder cost £128 each.
The business is run from rented warehouse premises.
Roger supplies you with the following trial
Trade payables 30 729
Sundry expenses 2 678
Warehouse rental 12 629
Sales representative’s car 15 900
Long-term loan 5 000
Capital at 1 January 2021 26 679
Business rates 1 920
Revenue 313 475
Accumulated
Accumulated depreciation-Warehouse fixtures 182
Cash at bank 1 826
Water rates 850
Drawings 18 214
Sales representative’s salary 26 241
Administration expenses 3 122
Purchases of water coolers 233 668
Trade receivables 32 635
Telephone 2 961
Travelling expenses 1 820
Loan interest 250
Insurance 1729
Inventory at 1 January 2021 25 620
Warehouse fixtures 1 820
a. Depreciation is calculated at 30% on the reducing balance basis for the Sales representative
car.
b. Depreciation is calculated on the straight-line basis at 10% of cost for the Warehouse fixture
c. Accruals are also required for telephone charges -£686
d. Included in the administrative expense is £150 for professional fees and subscriptions total is
to be treated as a prepayment. Also, £750 of the insurance relates to the next following
accounting period.
Prepare an income statement and
year ended 31 December 2021
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