Reference no: EM132709289

Question - Tricia owns a retail store. Her business's financial year end is 31st December. The following trial balance was extracted from the business's books of account on 31st December 2018.

Trial balance at 31 December 2018

Dr Cr

Accounts payable 11,850

Accounts Receivable 27,000

Bad Debts 850

Capital 61,210

Cash at bank 3,890

Drawings 31,300

Equipment:

Cost 35,000

Provision for depreciation at 1 January 2018 14,000

Gross Profit 151,270

Inventory at 31 December 2018 29,480

Operating expenses 57,610

Rent 25,400

Vehicles:

Cost 45,000

Provision for depreciation at 1 January 2018 16,200

255,530 255,530

Additional information at 31 December 2018:

i. Rent, $1320, prepaid

ii. Operating expenses, $2,080, due but unpaid

iii. Tricia decided to make a provision for doubtful debts of 5% of the accounts receivable at the year end.

iv. Depreciation charged on non-current assets are as follows:

Equipment is depreciated by 20% per annum using the straight-line method Vehicles are depreciated by 20% per annum using the reducing balance method.

Required - Prepare end of year financial statements.