Sam Brown’s accounting period is from January 1 to December 31. The following provides information for three periods.
Year Debtor Balances Provision for Doubtful Debts
2000 20,000 5%
2001 30,000 6%
2002 25,000 4%
Write up the Provision for Doubtful Debts Account for each of the three years ending December 31 2000 to 2002.
Novelty Chemicals bought a Motor Vehicle for $110,000 on January 5, 2002. The estimated useful life of the vehicle is ten years. The disposal value is estimated at $10,000. Annual depreciation is on the straight line method.
Required for years 2002, 2003 and 2004:
(a)The accumulated Depreciation account- Motor Vehicle
(b)The Balance Sheet extracts for motor vehicle and its related depreciation.
(c)The Profit and Loss accounts extracts for annual depreciation
The Trial balance of Wholesome Groceries as at December 31, 2005 is shown below.
Closing Stock $18,000
Rent paid in advance $4,000
Wages and Salaries owing $3,400
Insurance owing $600
Provision for doubtful debt to be created $600
Depreciation on machinery and equipment for the period $3,000
Prepare the Following for Wholesome Groceries:
1. The Trading and Profit and Loss account for the period ending December 32, 2005
2. The Balance Sheet as at December 31, 2005.