Reference no: EM133106608

Question - The following Trial Balance was extracted from the books of Max Enterprise as at 31 December 2020.

	Dr (RM)	Cr (RM)
Capital		260,248
Carriage inwards	2,900
Carriage outwards	8,200
Bad debts	12,500
Drawings	12,100
Motor Vehicle	110,100
Provision for Depreciation - Motor Vehicle		13,605
Truck	93,000
Provision for Depreciation - Truck		6,150
Debtors	80,000
Bank	30,700
Cash	26,000
Rent received		9,700
Purchases	125,000
Salary	72,060
Stock as at 31-12-2019	95,000
Creditors		78,000
Advertising expenses	22,200
Telephone charges	11,800
Commission Received		18,000
Sales		343,757
Returns	17,400	5,000
Stationeries	15,500
Total	734,460	734,460

The following adjustments are to be taken into account:

a) Stock as at 31 December 2020 was valued at RM 50,000.

b) Bad debt to be written off was RM 3,000.

c) The depreciation allocated for the current year were as follows: Motor Vehicle 20% per annum at cost. Truck 10% per annum at cost.

d) Rent received still outstanding of RM 700.

e) Salary paid in advanced was RM 1,600.

Required -

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

2) Prepare balance sheet as at 31 December 2020.