Question

0.000 The the queens of Ladidown Kingdom Queen Command Queen Cad.came together to form The Lockdows Enterprise, to better the economistance of be kingdom In this business, they agreed to share profits and losses in the ratio of the opening capital Trial Balance as at 31 March, 2020 Particulars Dub) Credit (GHC) LA E60000 12.000 Levent 04.19 Wapes of contract workers 46000 Selain of staff MO Camare for goods faced 5200 170 Deco 24000 Paches 1905.200 Real 13,000 மாாபனா 122100 Busca 101 1296 Tretmen 17010 136,000 Donation to al Pand Additional Information: Due to the economic recession at the moment, the partners estimated that more of their receivables may not be able to settle their debts. Hence, they wrote off additional debts of GH¢15,000 and agreed to maintain provisions for doubtful debts at 5%. ii. They agreed to provide for discount on receivables at 5% iii. All property, plant and equipment are to be depreciated at 10% iv. The business claimed insurance of GH€21,000 for goods that were lost due to fire. The insurance claim, though admitted, had not been paid as at the year end. Queen Corona took goods amounting to GH€ 17.400 for personal use. vi. Goods worth GH 24,000 bought on 24/04/19 on credit were not recorded in the books. vii. Outstanding salaries were GH 32,000 whereas wages of GH¢24,600 were paid in advance. viii. The partners agreed to charge interest on capital at 6% and on drawings at 7% Bills receivable of GH€ 12,600 was dishonored. The inventory count at the year-end revealed goods worth GH€300,000 Calculate the working capital for Lockdown Entreprise Recenabend Pea 6600 922.000 0.000 728.000 6000 20.000 1700 Provision for doubtfuldete Rates and Tones Brokerage Capital Accounts Que Corea Queen.com Carrot Accounts Den er Queen 500 000 128.000 13.20

Answer 1

		GHC
I & II	Receivables	920,000
	Less: bad Debts	15,000
		905,000
	Less:Discount provision	45,250
		859,750
	Less:Provision for doubtful debts	42,988
		816,763
III	Depreciation on plant and equipment is not the part of working capital
IV	Insurance Receivable	Dr	21,000	Current Asset
	Inventory	Cr	21,000	Current Asset
V	Current Account-Queen Corona	Dr	17,400	Capital
	Inventory	Cr	17,400	Current Asset
VI	Inventory	Dr	24,000	Current Asset
	Payables	Cr	24,000	Current Liability
VI	Salaries and wages of staff	Dr	32,000	Expenses
	Outstanding Salaries	Cr	32,000	Current Liability
	Advance Salary	Dr	24,600	Current Asset
	Cash	Cr	24,600	Current Asset
VII	Interest on capital and drawings---Its not part of working capital
IX	Receivables	Dr	12,600	Current Asset
	Bills receivable	Cr	12,600	Current Asset
X	Closing Stock GHC 300,000
Additional Entry
1	Interest receivable	Dr	4,080	Current Asset
	Interest on Investment	Cr	4,080	Income
2	Interest on loan	Dr	11,200	Expense
	Interest Payable	Cr	11,200	Current Liability
	Working Capital
	Current Asset
	Receivables	829,363	(816763+12600)
	Insurance receivable	21,000
	Inventory	285,600	(300000-21000-17400+24000)
	Bills Receivable	95,400	(108000-12600)
	Interest receivable	4,080
	Bank	703,400	(728000-24600)
	Advance Salary	24,600
	Total	1,963,443
	Current Liability
	Payables	264,000	(240000+24000)
	Outstanding Salaries	32,000
	Interest Payable	11,200
	Provision for doubtful debts	42,988
	Total	350,188
	Working Capital	1,613,255