Statement of Profit or Loss for the year ended 31 December 20.9
Sales R330 000
Less: Sales returns (R8 000)
Net Sales R322 000
Cost of Sales:
Opening Inventory R50 000
Purchases R157 500
Less: Closing Inventory (R47 500)
Cost of Goods Sold R160 000
Gross Profit R162 000
Other Income:
Rent Income R27 000
Interest Income R9 000
Total Other Income R36 000
Expenses:
Wages and Salaries R96 000
Sundry Expenses R18 000
Insurance Expense R4 500
Depreciation Expense (R40 000 x 10%) (R4 000)
Total Expenses R114 500
Net Profit R83 500
Statement of Changes in Equity for the year ended 31 December 20.9
Capital at 1 January 20.9 R434 000
Add: Net Profit R83 500
Less: Amount lent to employee (R2 000)
Capital at 31 December 20.9 R515 500
Statement of Financial Position as at 31 December 20.9
Assets
Land and Buildings R250 000
Investments R120 000
Furniture R40 000
Less: Depreciation (R40 000 x 10%) (R4 000)
Net Furniture R36 000
Cleaning Materials R10 000
Receivables R20 000
Bank R26 000
Inventories R47 500
Total Assets R513 500
Equity and Liabilities
Capital R515 500
Current Liability:
Insurance Premium R500
Total Equity and Liabilities R513 500
OP Distributors had the following balances in their records at the end of their reporting
period, 31 December 20.9:
Debit Credit
R R
Land and buildings 250 000
Investments 120 000
Furniture at carrying amount 40 000
Cleaning materials 10 000
Receivables 20 000
Bank 26 000
Capital 434 000
Sales 330 000
Purchases 157 500
Sales returns 8 000
Rent income 27 000
Wages and salaries 96 000
Sundry expenses 18 000
Interest income 9 000
Insurance expense 4 500
Inventories 01/01/20.9 50 000
R800 000 R800 000
Additional information
1 The investment was made for a full year, but interest was received for only nine
months.
2 No depreciation has yet been written off for the year. It is the entity’s policy to write
off depreciation on furniture at 10% per annum on the diminishing balance method.
3 Cleaning materials worth R3 000 were on hand on 31 December 20.9.
4 Rent income, R27 000, includes R5 400 for the first three months of 20.10.
5 Wages and salaries include an amount of R2 000 which was lent to an employee. The
amount will be repaid during January 20.10.
6 At the end of the period R500 was owed on insurance premiums.
7 Inventory on 31 December 20.9 amounted to R47 500.
Assignment
From the above-mentioned information prepare a statement of profit or loss and a statement
of changes in equity for the year ended 31 December 20.9, and a statement of financial
position as at 31 December 20.9.
1 answer
1 answer