S Limited is a private limited company. The directors have extracted the following information at 30 September 2019.
6% debentures (2021 – 2022)
|
$
|
$
68 000
|
Accrued expenses Administrative expenses Bank overdraft
Carriage inwards
|
63 810
3 600
|
2 480
12 770
|
Distribution costs
|
49 330
|
|
Interest paid
|
8 160
|
|
Inventory at 1 October 2018
|
62 500
|
|
Freehold property Motor vehicles
Cost
|
220 000
84 600
|
|
Provision for depreciation at 1 October 2018
|
|
38 760
|
Office equipment Cost
Provision for depreciation at 1 October 2018 Prepaid expenses
|
68 700
4 400
|
32 300
|
Purchases Retained earnings Returns inwards Revenue
|
392 340
3 470
|
69 700
764 570
|
Share capital (ordinary shares of $1 each)
|
|
50 000
|
Share premium
|
|
15 000
|
Trade payables Trade receivables
|
86 500
|
48 730
|
Wages and salaries
|
54 900
|
|
The following information is also available:
1 The value of inventory at 30 September 2019 was $73 100 at cost. The directors now wish to write off $2000 in respect of damaged items.
2 Purchase of new office equipment of $6000 had been posted to distribution costs in error.
3 Motor vehicles are to be depreciated at 20% per annum using the straight-line method. The estimated residual value of the motor vehicles is $20 000. Depreciation is to be charged to distribution costs.
4 Office equipment is to be depreciated at 15% per annum using the reducing balance method. Depreciation is to be charged to administrative expenses.
5 At 30 September 2019 there was an additional accrual for wages and salaries of $1700. Wages and salaries are to be charged as 70% to administrative expenses and 30% to distribution costs.
6 Interest paid included debenture interest paid to 30 June 2019.
7 At 30 September 2019 there was an additional prepayment of $4800 for administrative expenses.
8 The directors wish to create a provision for doubtful debts equal to 2% of trade receivables at 30 September 2019 and include it in administrative expenses.
REQUIRED