Reference no: EM132591799

Mr. Evans Otabil has been in business for a number of years. In the past year, he has been busy Learning for the ICAG exams and has not kept proper records for his business. He has given you some information.

                                           1st June, 2017                     31st May, 2018

Inventory                                 1,019                         2,998

Trade Receivables                      3,605                           2,070

Trade Payables                          1,740                             970

Telephone prepaid                        200                              265

Cash at Bank                               1,696                          (1144)

The bank statements for the year to 31st May, 2018 are summarized as follows:

                                                   GH¢

Payments to suppliers         8,460

Receipt from Customers      6,690

Cash takings                    5,900

Drawing                          3,120

Rent                               2,700

Telephone                           1,150

Other balances as at 1st June, 2017 are as follows: GH¢

Motor vehicle (cost GH¢ 6,000) 4,750

Rent; Outstanding 165

Prepaid 100

You are given the following additional information:

i. Depreciation is to be charged at 20% on straight line method. Mr. Otabil took goods for his personal use worth GH¢375.

ii. A telephone bill was received on 7th July, 2018 for GH¢375, this related to the quarter ended 30th June, 2018.

iii. Rent includes GH¢960 paid on 1st January, 2018 for the year to 31st December, 2018.

iv. Motor vehicle was sold for GH¢ 4,411 on 1st February, 2018.

v. All expenses and incomes are assumed to accrue equally.

Required

Question 1: statement of profit or loss for Mr. Otabil for the year ended 31st May, 2018.