Cambridge IGCSE Accounting(0452)/O Level Principles of Accounts(7110) Notes: Simple Trading and Profit and Loss Account (Income Statement) Example 2
From the following trial balance of J Nhiwatiwa after his first year’s trading, you are required to
draw up a trading and profit and loss account for the year ended 30 June 20X8. A statement of financial position is not required.
| $ | $ | |
|---|---|---|
| DR | CR | |
| Sales | 265,900 | |
| Purchases | 154,870 | |
| Rent | 4,200 | |
| Lighting and heating expenses | 530 | |
| Salaries and wages | 51,400 | |
| Insurance | 2,100 | |
| Buildings | 85,000 | |
| Fixtures | 1,100 | |
| Debtors | 31,300 | |
| Sundry expenses | 412 | |
| Creditors | 15,910 | |
| Cash at bank | 14,590 | |
| Drawings | 30,000 | |
| Vans | 16,400 | |
| Motor running expenses | 4,110 | |
| Capital | 114,202 | |
396,012 | 396,012 |
Stock at 30 June 20X8 was $16,280.
Solution
J Nhiwatiwa
Trading and Profit and Loss Account for the year ended 30 June 2018
| $ | $ | |
|---|---|---|
| Sales | 265,900 | |
| Less Cost of Goods Sold: | ||
| Purchases | 154,870 | |
| Less closing stock | (16,280) | |
(138,590) |
||
127,310 |
||
Less expenses: | ||
| Rent | 4,200 | |
| Lighting and heating expenses | 530 | |
| Salaries and wages | 51,400 | |
| Insurance | 2,100 | |
| Sundry expenses | 412 | |
| Motor running expenses | 4,110 | |
(62,752) |
||
64,558 |
To access more topics go to the Cambridge IGCSE Accounting(0452)/O Level Principles of Accounts(7110) Notes.
