Description
Legal Practice Management
- Mr. Muchai has been trading for some years as a soft drink merchant. The following list of balances has been extracted from his ledger as of 30th April 2010
Sh.
| Capital | 83,887 |
| Sales | 259,870 |
| Trade Accounts payable | 19,840 |
| Returns Outwards | 13,407 |
| Allowance for doubtful debts | 512 |
| Discounts allowed | 2,306 |
| Discounts Received | 1,750 |
| Purchases | 135,680 |
| Returns Inwards | 5,624 |
| Carriage Outwards | 4,562 |
| Drawings | 18,440 |
| Carriage Inwards | 11,830 |
| Rent, Rates, and Incurrence | 25,973 |
| Heating and Lighting | 11,010 |
| Postage, Stationery, and Telephone | 2,410 |
| Advertising | 5,980 |
| Salaries and Wages | 38,521 |
| Bad Debts | 2,008 |
| Cash in Hand | 534 |
| Cash at Bank | 4,440 |
| Inventory as of 1 st May 2009 | 15,564 |
| Trade Accounts receivable | 24,500 |
| Fixtures and Fittings | 120,740 |
| Provision for depreciation — as of 30th April 2010 | 63,020 |
| Depreciation | 12,074 |
The following additional information as of 30th April 2010 is available:
- i) Inventory at the close of business was valued at Sh.17,750 Insurances have been prepaid by Sh.1,120 iii) Heating and lighting is accrued by Sh.1,360 iv) Rates have been prepaid by Sh.5,435
- v) The allowance for doubtful debts is to be adjusted so that it is 3% of trade accounts receivable.
Required:
Prepare Mr. Muchai’s income statement for the year ending 30th April 2010 and a balance sheet as of that date.
(15 marks)
ATP 106 Legal Practice Management (r) 2012-1 ATP 106 Legal Practice Management (r) 2012-2
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