Select Ltd is registered with an authorised share capital of 300,000 ordinary shares of Ksh.1. The following trial balance was extracted from the books of the company on 31 March 2020, after the preparation of the trading account: Dr Cr Kshs Kshs Ordinary share capital, fully paid 200,000 Land and buildings at cost 170,000 Sundry debtors 38,300 Furniture and fittings at cost 80,000 General expenses 3,800 Sundry Creditors 25,000 Stock at 31 March 2020 42,000 Bank 12,000 Trading account: gross profit 98,050 Office salaries and expenses 25,000 Accumulated provision for depreciation on furniture and fittings 32,000 Share premium account 20,000 Advertising and selling expenses 5,000 Bad debts 250 Provision for doubtful debts 600 Profit and loss account 12,000 Directors’ fees 11,300 387,650 387,650 ‘The following information is given: i. The provision for doubtful debtors is to be adjusted to Kshs 700. ii. Depreciation is to be provided in respect of furniture and fittings at 10% per annum on cost. iii. Kshs 15,000 is to be transferred from profit and loss to general reserve. iv. Provision for corporation tax was Kshs. 5,000 v. Provide for a proposed dividend on share capital at 10%. Required to Prepare: ii. Balance Sheet (Statement of Financial position) as at that date. (10 Marks)
Select Ltd is registered with an authorised share capital of 300,000 ordinary shares of Ksh.1. The following
Dr Cr
Kshs Kshs
Ordinary share capital, fully paid 200,000
Land and buildings at cost 170,000
Sundry debtors 38,300
Furniture and fittings at cost 80,000
General expenses 3,800
Sundry Creditors 25,000
Stock at 31 March 2020 42,000
Bank 12,000
Trading account: gross profit 98,050
Office salaries and expenses 25,000
Accumulated provision for
Share premium account 20,000
Advertising and selling expenses 5,000
Provision for doubtful debts 600
Directors’ fees 11,300
387,650 387,650
‘The following information is given:
i. The provision for doubtful debtors is to be adjusted to Kshs 700.
ii. Depreciation is to be provided in respect of furniture and fittings at 10% per annum on cost.
iii. Kshs 15,000 is to be transferred from profit and loss to general reserve.
iv. Provision for corporation tax was Kshs. 5,000
v. Provide for a proposed dividend on share capital at 10%.
Required to Prepare:
ii. Balance Sheet (
Step by step
Solved in 2 steps with 1 images
