(25 Marks) Question 2 Mr Tisha-Nyama has been trading for some years. The follow
ID: 2558413 • Letter: #
Question
(25 Marks) Question 2 Mr Tisha-Nyama has been trading for some years. The following list of balances has been extracted from his ledger as at 28 February 2018, the end of his recent financial year N$ Sales 62 330 Bank Account 25 900 ary Expense Stationery Expense Rent Expense 10 390 4 500 380 rovision for doubtful debts Telephone Creditors Bad Debts 86 5 000 1280 12 500 otor Vehicle The following additional information as at 28 February 2018 is available a) Monthly rent expense of N$ 500; b) Salary is in arrears with N$ 520 c) Telephone was paid in advance with N$ 710 d) Depreciation on motor vehicle is provided at 20% per annum, straight line method and no scrap value; e) Provision for doubtful debts has been increased to NS 500 REQUIRED i) Journalise the above transactions, NARRATION IS NOT REQUIRED. i) Prepare a post-adjusted trial balance as at 28 February 2018Explanation / Answer
1-
adjustment Journal Entries
T- Account
date
explanation
debit
credit
rent expense
balance
4500
balance
5000
rent expense
500
bank
500
bank
500
bank
salary expense
520
balance
25900
rent expense
500
salary payable
520
prepaid telephone
710
balance
24690
prepaid telephone
710
bank
710
salary expense
balance
15580
balance
16100
depreciation expense
2500
salary payable
520
accumlated depreciation
2500
salary payable
bad debt
500
balance
520
salary expense
520
allowance for doubtful debts
500
prepaid telephone
Adjusted trial balance
bank
710
balance
710
Explanantion
debit
credit
sales
62330
depreciation expense
bank account
24690
allowance for doubtful debts
2500
balance
2500
salary expense
16100
stationary expense
10390
accumlated depreciation
rent expense
5000
balance
2500
depreciation expense
2500
allowance for doubtful debts
500
telephone expense
3860
bad debt
prepaid telephone expense
710
balance
1280
balance
1400
salary payable
520
allowance for doubtful debts
120
depreciation expense
2500
allowance for doubtful debts
accumlated depreciation
2500
balance
500
balance
380
bad debt
1400
bad debt
120
motor vehicle
12500
creditors
5000
total
77150
70850
Total of trial balance is not matching because unadjusted trial balance is not matched
adjustment Journal Entries
Adjusted trial balance
2-
T- Account
Explanantion
debit
credit
date
explanation
debit
credit
accounts receivables
accounts receivables
18600
sales
44100
cash
17500
sales
44100
accounts receivables
25600
cash
8000
purchase
10000
accounts receivables
18500
balance
18600
water expense
5200
sales
44100
cash
15500
sales
49300
44100
purchase
10000
balance
44100
accounts receivables
25600
Total of trial balance is not matching because unadjusted trial balance is not matched
cash
10000
accounts receivables
18500
purchase
water expense
5200
cash
10000
balance
10000
cash
5200
water expense
cash
17500
cash
5200
balance
5200
accounts receivables
17500
cash
cash
8000
accounts receivables
17500
purchase
10000
accounts receivables
8000
accounts receivables
8000
balance
15500
1-
adjustment Journal Entries
T- Account
date
explanation
debit
credit
rent expense
balance
4500
balance
5000
rent expense
500
bank
500
bank
500
bank
salary expense
520
balance
25900
rent expense
500
salary payable
520
prepaid telephone
710
balance
24690
prepaid telephone
710
bank
710
salary expense
balance
15580
balance
16100
depreciation expense
2500
salary payable
520
accumlated depreciation
2500
salary payable
bad debt
500
balance
520
salary expense
520
allowance for doubtful debts
500
prepaid telephone
Adjusted trial balance
bank
710
balance
710
Explanantion
debit
credit
sales
62330
depreciation expense
bank account
24690
allowance for doubtful debts
2500
balance
2500
salary expense
16100
stationary expense
10390
accumlated depreciation
rent expense
5000
balance
2500
depreciation expense
2500
allowance for doubtful debts
500
telephone expense
3860
bad debt
prepaid telephone expense
710
balance
1280
balance
1400
salary payable
520
allowance for doubtful debts
120
depreciation expense
2500
allowance for doubtful debts
accumlated depreciation
2500
balance
500
balance
380
bad debt
1400
bad debt
120
motor vehicle
12500
creditors
5000
total
77150
70850
Total of trial balance is not matching because unadjusted trial balance is not matched
adjustment Journal Entries
Adjusted trial balance
2-
T- Account
Explanantion
debit
credit
date
explanation
debit
credit
accounts receivables
accounts receivables
18600
sales
44100
cash
17500
sales
44100
accounts receivables
25600
cash
8000
purchase
10000
accounts receivables
18500
balance
18600
water expense
5200
sales
44100
cash
15500
sales
49300
44100
purchase
10000
balance
44100
accounts receivables
25600
Total of trial balance is not matching because unadjusted trial balance is not matched
cash
10000
accounts receivables
18500
purchase
water expense
5200
cash
10000
balance
10000
cash
5200
water expense
cash
17500
cash
5200
balance
5200
accounts receivables
17500
cash
cash
8000
accounts receivables
17500
purchase
10000
accounts receivables
8000
accounts receivables
8000
balance
15500
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