[Taykto]

28
GT Ltd provides you with the following information at 30.06.Y1 Amounts in MUR.
1. Property, Plant and Equipment 505,000. Other Financial Assets 120,000. Inventories 200,000. Trade and other Receivables 202,000. Prepayments 10,000. Cash and Cash Equivalents 803,000. Capital and Reserves 808,000. Interest Bearing Borrowings 250,000. Current Portion of IBB 150,000. Short-term Borrowings 30,000 Trade and Other Payables 602,000.
2. After enquiry, the Accounts Clerk gives you the following additional notes. Notes to Balance Sheet-




- Computer at cost 500,000. Fan at cost 16,000.
- Accumulated Depreciation: Computer 10,000. Fan 1,000.
- Depreciation on property, Plant and Equipment: 10% per annum on cost at start of period.
Inventories are valued at lower of cost and NRV.
- Trade and Other Receivables: S Smith 152,000. W White 50,000.
- Prepayments are for Rent. Cash and Cash Equivalents comprise: Cash Balance 287,000. Bank
Balances 496,000. Loan to Fish 20,000.
- Capital 500,000. Reserves 200,000. Retained Earnings 108,000. .
- Interest Bearing Borrowings 400,000 are from O. Orange at an annual rate of interest of 10%
repayable in 2 years. Short term Borrowings 30,000 interest free from V. Violet.
- Trade and Other Payables are made up of: Office Equipment Ltd 500,000 R. Red 82,000.
Salaries Due 20,000.
You are also given a "Summary of Transactions" not yet recorded for Y2 (3 to 14).








3. PURCHASES: Goods
Cash 100,000, cheque 400,000 plus 15% VAT in both cases Credit from R. Red: 150,000 Trade Discount 10%
230,000 15% VAT inclusive
100,000+ 15% VAT
400,000 Trade Discount 10% VAT 15%
207,000 Net of Trade Discount 10% + VAT inclusive 15%

4.SALES: Goods
Cash 500,000 cheque 800,000 plus 1 5% VAT in both Credit to S Smith: 180,000 Trade Discount 10%
368,000 including 15% VAT
140,000 + 15% VAT
600,000 Trade Discount 10% VAT 15%
828,000 Net of 10% Trade Discount including VAT 15%
To W. White: Fan at a loss of 2000 - Cheque.
Computer costing 50,000 for 52,000.
Another Computer costing 50,000 for 49,000
5. DEBIT NOTE: to R. Red. 10.000 out of 150.000 from 3 above





6. CREDIT NOTE: to S. Smith, 20,000 from 1 80,000 from above. From S. Smith 10,000. VAT FREE
7. PAYMENTS TO R. RED: Cash 280,000, Cheque 700,000 after 2% Discount. RECEIPTS FROM S. SMITH: Cash 1 00,000 Cheque l.lm, Discount Allowed 1%.
FROM BANK: Debit Advice - Interest on loan 40,000 Credit Advice - Interest 5,000.

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10. CASH RECEIPTS ISSUED

Loan Fish 20,000. W.White 30,000.
11. CASH RECEIPTS OBTAINED

Loan V. Violet 30,000.Postage 2,000. Repairs and Maintenance 4,000. Sundry Expenses Salaries paid in cash 500,000.

12. CHEQUES ISSUED - FROM CHEQUE BOOK
Office Equipment Ltd 500, Loan O. Orange 100,000. Electricity 10,000. Advert 50,000.
Salaries and Wages 100,000.


PAYE 10,0000 (Retained earlier).
NPS 3,000 (Deducted from Salaries)
VAT24,000 Dividends 500,000. Income Tax 500,000.

13. DEPOSITS MADE - FROM PAYING IN BOOK
^ Issue of shares 500,000.
14. OTHER MATTERS
Closing Inventories 100,000. Rent Due 50,000. Advert prepaid 30,000.
15. The Management of GT Ltd believes that after having followed the "Advanced Course for
Accounts Clerk" you are equipped to prepare, in the absence of the Accountant a set of Financial
Statements in compliance with International Accounting Standards.

Thank you
Taykto

[rehmanvohra]

I am afraid I can not solve the question for you, but I can guide you how to solve it.

1. Prepare a cash account recording the opening balance, receipts and payments. That will give you the ending balance
2. Prepare accounts for the accounts payable as well as accounts receivable and post the necessary debits and credits relating to them. You should get the ending balances of the receivables and payable. Do not forget to adjust discounts received and allowed.
3, Your question does not mention the treatment of VAT. I would assume that they are paid off or collected at the end of the period.
4. You should now have sufficient information to compile income statement and balance sheet.

I would like you to attempt as suggested and if there is any discrepancy, I will surely help you out.