Part 2 l The financial statements of sole traders
Review questions
9.1 From the following information, draw up the trading account of J Bell for the year ended
31 December 20X7, which was his first year in business:
£
Carriage inwards 980
Returns outwards 840
Returns inwards 1,290
Sales 162,918
Purchases 121,437
Stocks of goods: 31 December 20X7 11,320
9.2A The following information is available for the year ended 31 March 20X8. Draw up the
trading account of P Frank for that year.
£
Stocks: 31 March 20X8 52,400
Returns inwards 16,220
Returns outwards 19,480
Purchases 394,170
Carriage inwards 2,490
Sales 469,320
9.3 From the following trial balance of G Still, draw up a trading and profit and loss account for
the year ended 30 September 20X9, and a balance sheet as at that date.
Dr Cr
£ £
Stock 1 October 20X8 41,600
Carriage outwards 2,100
Carriage inwards 3,700
Returns inwards 1,540
Returns outwards 3,410
Purchases 188,430
Sales 380,400
Salaries and wages 61,400
Warehouse rent 3,700
Insurance 1,356
Motor expenses 1,910
Office expenses 412
Lighting and heating expenses 894
General expenses 245
Premises 92,000
Motor vehicles 13,400
Fixtures and fittings 1,900
Debtors 42,560
Creditors 31,600
Cash at bank 5,106
Drawings 22,000
Capital 68,843
484,253 484,253
Stock at 30 September 20X9 was £44,780.
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Chapter 9 l Trading and profit and loss accounts and balance sheets: further considerations
9.4 The following trial balance was extracted from the books of F Sorley on 30 April 20X7. From
it, and the note about stock, prepare his trading and profit and loss account for the year ended
30 April 20X7, and a balance sheet as at that date.
Dr Cr
£ £
Sales 210,420
Purchases 108,680
Stock 1 May 20X6 9,410
Carriage outwards 1,115
Carriage inwards 840
Returns inwards 4,900
Returns outwards 3,720
Salaries and wages 41,800
Motor expenses 912
Rent 6,800
Sundry expenses 318
Motor vehicles 14,400
Fixtures and fittings 912
Debtors 23,200
Creditors 14,100
Cash at bank 4,100
Cash in hand 240
Drawings 29,440
Capital 18,827
247,067 247,067
Stock at 30 April 20X7 was £11,290.
9.5A The following is the trial balance of T Owen as at 31 March 20X9. Draw up a set of financial
statements for the year ended 31 March 20X9.
Dr Cr
£ £
Stock 1 April 20X8 52,800
Sales 276,400
Purchases 141,300
Carriage inwards 1,350
Carriage outwards 5,840
Returns outwards 2,408
Wages and salaries 63,400
Business rates 3,800
Communication expenses 714
Commissions paid 1,930
Insurance 1,830
Sundry expenses 208
Buildings 125,000
Debtors 45,900
Creditors 24,870
Fixtures 1,106
Cash at bank 31,420
Cash in hand 276
Drawings 37,320
Capital 210,516
514,194 514,194
Stock at 31 March 20X9 was £58,440. ‘
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Part 2 l The financial statements of sole traders
‘ 9.6A F Brown drew up the following trial balance as at 30 September 20X8. You are to draft the
trading and profit and loss account for the year ended 30 September 20X8 and a balance sheet as
at that date.
Dr Cr
£ £
Capital 49,675
Drawings 28,600
Cash at bank 4,420
Cash in hand 112
Debtors 38,100
Creditors 26,300
Stock 30 September 20X7 72,410
Van 5,650
Office equipment 7,470
Sales 391,400
Purchases 254,810
Returns inwards 2,110
Carriage inwards 760
Returns outwards 1,240
Carriage outwards 2,850
Motor expenses 1,490
Rent 8,200
Telephone charges 680
Wages and salaries 39,600
Insurance 745
Office expenses 392
Sundry expenses 216
468,615 468,615
Stock at 30 September 20X8 was £89,404.
9.7 Enter the following transactions in the ledger of A Baker and prepare a trial balance at
31 May, together with a calculation of the profit for the month and a balance sheet at 31 May.
May 1 Started in business with £1,500 in the bank and £500 cash
May 2 Purchased goods to the value of £1,750 from C Dunn, agreeing credit terms of 60 days
May 3 Bought fixtures and fittings for the bakery for £150, paying by cheque
May 6 Bought goods on credit from E Farnham for £115
May 10 Paid rent of £300 paying cash
May 12 Bought stationery – cash book and invoices – for £75 – paying by cash
May 14 Sold goods on credit, value £125, to G Harlem
May 20 Bought an old van for deliveries for £2,000 on credit from I Jumpstart
May 30 Paid wages of £450 net for the month by cheque, Inland Revenue deductions of £75 to
be paid in the following month
May 31 Summarised cash sales for the month and found them to be £2,500. Took a cheque for
£500 as own wages for the month. Banked £2,000 out of the cash sales over the month
May 31 Closing stock was £500
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