Trial balance exercise 1
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Trial Balance Exercise 1 James Darmody is the owner of Bootlegger Trader, a business that sells alcoholic beverages. The following is his business’ trial balance at 31 st December 2014: Trial Balance for the 12 months ended on 31 st December 2014 Accounts Mortgage loan Sales Carriage inwards Bad Debt Capital Inventory Drawings Office expense Debtors Utility expense Office Building Cost of Goods Sold Sales wages Sales return Creditor Advertising expense Cash Office equipment Interest expense Prepaid rent revenue Accrued Interest Revenue $ 1100 900 6950 2400 3000 4760 560 59200 44650 6460 1030 2900 16600 1750 800 $ 20050 64000 55800 8400 1810 3000 Additional information occuring on 31 st December 1) The business earned service revenue $1800 but has not received it.
Transcript of Trial balance exercise 1
Trial Balance Exercise 1
James Darmody is the owner of Bootlegger Trader, a business that sells alcoholic beverages. The following is his business’ trial balance at 31st December 2014:
Trial Balance for the 12 months ended on 31st December 2014AccountsMortgage loanSalesCarriage inwardsBad DebtCapitalInventoryDrawingsOffice expenseDebtorsUtility expenseOffice BuildingCost of Goods SoldSales wagesSales returnCreditor Advertising expenseCashOffice equipmentInterest expensePrepaid rent revenueAccrued Interest Revenue
$
1100900
6950240030004760560
592004465064601030
2900
166001750
800
$2005064000
55800
8400
1810
3000
Additional information occuring on 31 st December 1) The business earned service revenue $1800 but has not received it.2) It also received $4000 of consultation revenue, although it has not provided any services so far.3) It has earned $500 of rent (per month) for the last 6 months.4) It received $800 of the interest revenue owed from a borrower.
Requirements1) Adjust the trial balance based on the additional information.2) Prepare a P&L statement and Balance Sheet based on the adjusted trial balance.
Sample Balance Sheet (Vertical Format)
McGarrigle’s Shop of HorrorBalance Sheet as at 31 st December 2013
Owner’s EquityCapital Add: Net ProfitLess: DrawingsTotal O/E
Represented by:Current Assets Cash at BankDebtorsPrepaid Rent ExpenseAccrued Service RevenueInventory
Non – Current Assets Delivery VehiclesLess: Acc DepreciationFurnitureLess: Acc Depreciation
Total Assets
Current LiabilitiesCreditorsAccrued Sales Staff Salaries
Non-Current Liabilities Mortgage Loan
Total Liabilities
Net Assets
$
1714018400
1003800
41810
62000(29375)37000
(13200)
168001750
$
81250
56425
18550
32000
$
7495024575
(12400)87125
137675
50550
87125
