Using the balances extracted from the books of John Enterprises (run by Mr. John), prepare the final accounts (i.e., manufacturing trading and profit and loss account) for the year ended 31 March 2020. Also, prepare a balance sheet as on 31 March 2020. Stock on 31 March 2020 is as follows: The following liabilities are to be provided: Provide depreciation @ 10% on plant and 5% on furniture. Increase bad debts provision by $1,000. Five-sixths of rent and rates, lighting and heating, and insurance are to be allocated to the factory and one-sixth to the office. In the Books of John Enterprises
Manufacturing, Trading and Profit and Loss Account
For the year ended 31 March 2020 Balance Sheet as on March 31, 2020 Do you want to further test your knowledge about final accounts? We have prepared more quizzes for you.Practical Problem
$
Raw materials
35,600
Work-in-pr0gress
17,400
Finished goods
96,500
Packing materials
1,250
(a) Factory power
5,620
(b) Rent and rates
3,860
(c) Lighting and heating
1,600
(d) General expenses:
Factory
250
Office
400
(e) Insurance prepaid
1,700
Solution
Final Accounts of Sole Proprietorship: Practical Problem and Solution FAQs
The final account of a sole trader is a financial report that shows the full details of their business's Cash Flows and stock during a particular period.
Final Accounts are prepared in sole proprietorship businesses.
The Final Accounts of sole traders are similar to those prepared for Partnership firms except for the sale of goods.
Sole traders are required to prepare financial accounts, but not in detail. These will be bare figures showing the total of assets, liabilities, and capital introduced by the owner. Sole traders are also required to prepare a balance sheet.
In order to prepare a final account, you will need to gather the following information: - The balance sheet as of the end of the accounting period - The income statement for the accounting period - Any other relevant notes or disclosures
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