Final Accounts with Adjustments HL only R. Delaney and Edco Chapter 43 Final Accounts with Adjustments HL only

R. Delaney and Edco Demonstration Q4 Paper 2, 2003 is used to demonstrate the final accounts with adjustments. This is featured in the next two slides This is followed by the solutions to Qs 1 and 2 Textbook page 398

Closing Stock, €12,000 Trial Balance @ 31/5/03 R. Delaney and Edco Trial Balance @ 31/5/03 TRADING A/C & PROFIT AND LOSS A/Cs @ 31/5/03 DR € CR € 250,000 Sales 250,000 Cost of Sales Sales 250,000 Purchase 110,000 Purchase and Sales 110,000 250,000 Opening Stock 14,000 L e s Purchases Returns 5,000 Purchase Returns 5,000 Purchases 110,000 Òpening Stock 14,000 Less Purchase Returns 5,000 105,000 Opening Stock 1/6/02 14,000 Import Duty 1,000 Import Duty 1,000 Import Duty 1,000 Cost of Goods Avl. for Sale 120,000 Debtors and Creditors 18,000 13,000 Less Closing Stock 12,000 Insurance 5,000, Insurance 5,000 Cost of Goods Sold 108,000, 108,000 Wages 40,000, Wages 40,000 Gross Profit 142,000 Delivery Vans 68,000 Plus Gains Machinery 90,000 Commission Receivable 2,000 Plus Commission Due 500 2,500 Cash 2,000 144,500 Commission Receivable 2,000 144,500 Commission Receivable 2,000 Less Expenses Profit and Loss reserve 16,000 Reserves (P& L Bal.) 16,000 Insurance 5,000 L e s Bank Overdraft 4,000 Wages 40,000 Bad debts 2,000 Bad Debts 2,000 Plus Wages due 3,000 43,000 Buildings 190,000 Bad Debts 2,000 Depreciation Issued Share Capital 250,000 Machinery 10% 9,000 540,000 540,000 Delivery Vans 12% 8,160 17,160 67,160 67,160 Closing Stock, €12,000 Closing Stock €12,000 Net Profit 77,340 Less dividends declared 37,500 Commission Receivable due €500 Commission Receivable due €500 39,840 Dividends Declared 15% Dividends declared 15% Plus opening P &L Reserve 16,000 Depreciation : Machinery 10% Closing P & L Reserve 55,840 Depreciation : Delivery Vans 12% Wages Due €3,000 Wages Due €3,000

Closing Stock, €12,000 Trial Balance @ 31/5/03 R. Delaney and Edco Trial Balance @ 31/5/03 BALANCE SHEET AS AT 31/5/03 DR € CR € Fixed Assets Cost Dep Net Val. Purchase and Sales 110,000 250,000 Delivery Vans 68,000 8,160 59,840 Purchase Returns 5,000 Machinery 90,000 9,000 81,000 Opening Stock 1/6/02 14,000 Import Duty 1,000 Buildings 190,000 190,000 Debtors 18,000 Creditors 13,000 Debtors and Creditors 18,000 13,000 348,000 17,160 330,840 Insurance 5,000 Current Assets Wages 40,000 Debtors 18,000 Delivery Vans 68,000 Delivery Vans 68,000 Cash 2,000 Machinery 90,000 Machinery 90,000 Closing stock 1 2,000 Cash 2,000 Cash 2,000 Commission receivable 500 32,500 Commission Receivable 2,000 Current Liabilities Reserves (P& L Bal.) 16,000 Creditors 13,000 Bank overdraft 4,000 Bank Overdraft 4,000 Bank overdraft 4,000 Bad Debts 2,000 Wages due 3,000 Buildings 190,000 Buildings 190,000 Dividends declared 12% 37,500 57,500 Issued share capital 250,000 Issued Share Capital 250,000 Working capital - 25,000 540,000 540,000 Net Assets 305,840 Closing Stock, €12,000 Closing stock €12,000 Financed by: Commission Receivable due €500 Commission receivable due €500 Authorised Share Capital 300,000 Dividends Declared 15% Issued Share Capital 250,000 Dividends declared 15% Closing P & L Reserve 55,840 Depreciation : Machinery 10% Depreciation Machinery 10% Depreciation Delivery Van 12% Capital Employed 305,840 Depreciation : Delivery Vans 12% Wages due €3,000 Wages Due €3,000

Q1: Textbook: Page 398 Trading, Profit and Loss A/Cs at 31/3/09 € € € R. Delaney and Edco Q1: Textbook: Page 398 Trading, Profit and Loss A/Cs at 31/3/09 € € € Sales 340,000 Less sales returns 10,000 330,000 Cost of Sales Opening stock 12,000 Purchases 120,000 Carriage inwards 3000 Cost of goods available for sale 135,000 Less closing stock 25,000 Cost of goods sold 110,000 Gross Profit 220,000 Plus gains Rent receivable 23,000 Plus amount due 2,000 25,000 245,000 Less expenses Advertising 4,000 Plus amount due 3,000 7,000 Wages 40,000 Bad debts 2,000 Depreciation Motor vehicles 5% 9,000 Machinery 10% 13,500 22,500 71,500 Net profit 173,500

Q1: Textbook: Page 398 (cont) R. Delaney and Edco Q1: Textbook: Page 398 (cont) Profit and Loss Appropriation A/C at 31/3/09 € € € Net profit 173,500 Less dividends declared 43,300 130,200 Plus opening P & L balance 55,000 Closing profit and loss reserve 185,200

Q1: Textbook: Page 398 (cont) R. Delaney and Edco Q1: Textbook: Page 398 (cont) Balance Sheet as at 31/3/09 Cost Depr Net Value Fixed assets € € € Buildings 420,000 420,000 Motor vehicles 180,000 9,000 171,000 Machinery 135,000 13,500 121,500 735,000 22,500 712,500 Current assets Debtors 12,000 Closing stock 25,000 Rent receivable due 2,000 39,000 Less current liabilities Creditors 18,000 Bank overdraft 11,000 Advertising due 3,000 Dividends declared 10% 43,300 75,300 Working capital -36,300 Net Assets 676,200 Financed by: Authorised share capital 500,000 Issued share capital 433,000 Closing profit and loss reserve 185,200 10 Year loan 58,000 Capital Employed 676,200

Q2: Textbook: Page 398 Trading and Profit and Loss A/Cs at 31/5/09 € € R. Delaney and Edco Q2: Textbook: Page 398 Trading and Profit and Loss A/Cs at 31/5/09 € € € Sales 420,000 Cost of Sales Opening stock 30,000 Purchases 150,000 Less purchases returns 12,000 138,000 Import duty 11,000 Plus amount due 3,000 14,000 Cost of goods available for sale 182,000 Less closing stock 20,000 Cost of goods sold 162,000 Gross Profit 258,000 Plus gains Commission receivable 20,000 278,000 Less expenses Rates 15,000 Telephone 3,000 Wages 30,000 Less amount prepaid 4,000 26,000 Interest on overdraft 1,000 Depreciation Computer equipment 10% 9,000 54,000 Net profit 224,000

Q2: Textbook: Page 398 (cont) R. Delaney and Edco Q2: Textbook: Page 398 (cont) Profit and Loss Appropriation A/C at 31/5/09 € € € Net profit 224,000 Less dividends declared 5,500 218,500 Plus opening P & L balance 30,000 Closing profit and loss reserve 248,500

Q2: Textbook: Page 398 (cont) R. Delaney and Edco Q2: Textbook: Page 398 (cont) Balance Sheet as at 31/5/09 Cost Depr Net Value Fixed assets € € € Land 300,000 300,000 Computer equipment 90,000 9,000 81,000 390,000 9,000 381,000 Current assets Debtors 70,000 Cash 10,000 Closing stock 20,000 Wages prepaid 4,000 104,000 Less current liabilities Creditors 40,000 Bank overdraft 10,000 Import duty due 3,000 Dividends declared 5% 5,500 58,500 Working capital 45,500 Net Assets 426,500 Financed by: Authorised share capital 200,000 Issued share capital 110,000 Closing profit and loss reserve 248,500 15 Year loan 68,000 Capital Employed 426,500