Question 1 The following trial balance was extracted from the books of Jaya Enterprise at 31 December 2020

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Question 1

The following trial balance was extracted from the books of Jaya Enterprise at 31 December 2020.

 

	RM	RM
Bank	135,000
Drawings	10,000
Inventory as at 1 January 2020	800,000
Sales		2,100,000
Purchases	1,170,000
Accounts receivable	468,000
Allowance for doubtful debts		45,000
Accounts payable		890,000
Rent and rates	128,000
Heating and lighting	65,000
Insurance	350,000
Commission received		42,000
Bad debts	72,000
Motor vehicles	600,000
Returns inwards	30,000
Returns outwards		20,000
Furniture and fittings	400,000
Accumulated depreciation: Motor vehicles Furniture and fittings		180,000 76,000
Capitals		875,000

4,228,000

4,228,000

 

Additional information:

 

1. Inventory at the cost of business has been valued at RM550,000 at market price.
2. The allowance for doubtful debts is to be adjusted to 5% of accounts receivable.
3. Rent is due but unpaid RM42,000.
4. The amount shown for insurance on the trial balance includes a premium paid of RM4,200, which represents the annual insurance premium to 31^st March 2021.

 

5. Depreciation is written off non-current assets as follows: Motor vehicles at 10% per annum using straight line basis

Furniture and fittings at 10% per annum using reducing balance

 

 

Required:

 

1. Prepare the income statement for Jaya Enterprise for the year ended 31 December 2020

(15 marks)

 

2. Prepare the balance sheet for Jaya Enterprise as at 31 December 2020. (10 marks)