Question

D.Day Enterprise is a merchant dealing in imported goods. The following balances were extracted from the books of the business on 31 December 2014.

Accounts details $

Purchases 74,400

Sales 141,600

Return inwards 4,900

Sundry expenses 370

Freight charges 6,240

Motor vehicle expenses 7,250

Rent and Rates 5,720

Wages 19,600

Bank Loan interest 300

Bank Loan 6,000

Accounts receivable 15,000

Accounts payable 6,050

Inventory as at 1 January 2014 8,540

Equipment 5,800

Motor Vehicle 26,400

Drawings 12,000

Capital 35,700

Cash at Bank 2,830


i. Closing inventory at 31 December 2014 was valued at $10,750.

ii. A provision for doubtful debts of 3% of accounts receivable is to be made.

iii. The rent and rates amount given above includes rent of $900 prepaid till 31 March 2015.

iv. Interest on the loan is at the rate of 10% per annum.

v. Motor vehicles are to be depreciated by 20% per annum.
Prepare the Trial Balance based on the information given in the above table (Ignore the additional information when creating the Trial balance

Answer 1

Answer:Account Title Debit ($) Credit ($)

Purchases 74,400

Sales 141,600

Return inwards 4,900

Sundry expenses 370

Freight charges 6,240

Motor vehicle expenses 7,250

Rent and Rates 5,720

Wages 19,600

Bank Loan interest 300

Bank Loan 6,000

Accounts receivable 15,000

Accounts payable 6,050

Inventory 8,540

Equipment 5,800

Motor Vehicle 26,400

Drawings 12,000

Capital 35,700

Cash at Bank 2,830

Total 189,950 189,950

Note: The Trial Balance is a statement that lists all the accounts in the ledger along with their debit or credit balances. The total of the debit balances should be equal to the total of the credit balances.

Explanation:: The Trial Balance is a statement that lists all the accounts in the ledger along with their debit or credit balances. The total of the debit balances should be equal to the total of the credit balances.