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    Trading and Profit and loss Account and Balance Sheet

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    The following is the summarised Balance Sheet of Bracket and Racket Ltd a company wholly owned by its two shareholders,Bracket and Racket.
    Balansheet as at 31 March 2002

    $ $ $

    Fixed Assets at Net book Value
    Buildings 250000
    Fixtures 100000
    350000
    Current Assets
    Stock 1540000
    Debtors 820000
    cash 3000
    2363000
    Current Liabilites
    Creditors for supplies 1210000
    Accruals 192000
    Bank 203000 1605000
    758000
    1108000

    Financed By
    Share capital-Ordinary shares 25000
    Retained profits 910000
    Loan Accounts-Bracket 104000
    Loan Accounts-Racket 69000 173000
    1108000

    The company accountant resigned at the beginning of April 2002 and proper records were not kept for the six month period 1 April to 30 September 2002.

    The following information is available for that six month period
    0
    Payment by cheque for purchases 1996000
    Payment by cheque for expenses 823000
    Interest charged on overdraft 20000
    Cash and cheques banked 2784000

    Included in the amount banked was $53000 for the sale of an unused building book value $70000.

    Prior to banking the takings
    -1 $205000 was used to pay wages for the six months
    -2 Bracket and Racket each reduced their loans to the firm by $ 45000

    Deptreciation on all fixed assets which remain in the companys books at the end of an accounting periods is calculated at 25% per annum on the net book value.

    At 30 September 2002 the following figures were available.
    Creditors for Supplies 510000
    Accruals 103000
    Debtors 420000
    Stock 704000
    Cash 8000
    Bank over draft 195000
    Unpresented Cheques 63000

    Doubtful debts are estimated at 5% at 30 September 2002 and a provision for doubtful debts at that date is to be created.
    Required
    (a) Trading and Profit and loss Account for Bracket and Racket Ltd for the six months ended 30 September 2002.
    (b) A Balance sheet for Bracket and Racket Ltd at 30 September 2002

    © BrainMass Inc. brainmass.com March 4, 2021, 5:43 pm ad1c9bdddf
    https://brainmass.com/business/financial-statements/trading-profit-loss-account-balance-sheet-7781

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    Solution Summary

    Prepares Trading and Profit and loss Account and Balance Sheet for Bracket and Racket Ltd.

    $2.49

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