Question

You are presented with the trial balance of Oz Souvenirs', a company that sells souvenirs of Australia in Hahndorff, a small town just outside of Adelaide. You are required to use the information provided by Henry Hamilton, the owner of oz Souvenirs, to prepare a classified Income Statement for the year ended 30 June 2020 by using the unadjusted trial balance provided below, together with the additional information provided to you. Mr Hamilton mentioned that the order of the general ledger accounts in the trial balance may not be corred but that the amounts are correct. Oz Souvenirs Trial balance as at 30 June 2020 + Purchases Freight Outwards Computer Equipment Inventory (1 July 2019) Insurance expense Depreciation expense - Delivery vehicles Salaries and Wages expense -Sales staff Freight Inwards Doubtful Debts Expense Electricity expense Depreciation expense - Computer equipment Sales Returns and Allowances Delivery vehicles Rent expense - Shop Cash at Bank Accounts Receivable Drawings - H Hamilton Salaries and Wages expense-Administrative staff Discount allowed Allowance for Doubtful Debts Accumulated Depreciation - Delivery vehicles Discount received Sale Income Interest Income Accumulated Depreciation - Computer Equipment Purchase Returns and allowances Capital - H Hamilton (1 July 2019) Total Debit Credit ($) ($) 302,000 8,200 35,000 22,000 12,000 2,500 80,000 6,700 2,700 18,000 3,700 7,100 60,000 25,000 50,000 46,000 3.200 60,000 7,100 4.800 10,000 3,800 621,300 3,400 12,800 5,100 90,000 751,200 751,200 +

Answer 1

Income $645,500

1. Sale (Less Returns) = $6,14,200 ($6,21,300-$7,100)
2. Discount Received = $3,800
3. Interest Received = $3,400
4. Inventory (30th June 2020) = $17,000

Less: Expenses $544,800

1. Purchases (Less Returns)= $296,900 ($302,000-$5,100)
2. Freight outwards = $8,200
3. Inventory (1st July 2019) = $22,000
4. Insurance Ex[pense = $8,400 ($1200*70%)
5. Depreciation (Delivery Vehicle) = $2,500
6. Salaries and wages = $80,000
7. Freight Inwards = $6,700
8. Doubtful debts = $2,700
9. Electricity Expense = $12,000
10. Depreciation (Computer) = $3,700
11. Rent expense = $25,000
12. Discount allowed = $7,100
13. Administrative Expense = $69,600 ($12,000*30%+($18,000-$12,000)+$60,000)

Profit = $100,700