Clement Started Joy Co.a Business Dealing in Computer Accessories in 2018: Financial Accounting Assignment, SIM, Singapore

Question

Clement started Joy Co., a business dealing in computer accessories in 2018. The following trial balance has been extracted from the ledger of the business as of 31 July 2020:

Unadjusted Trial Balance as of 31 July 2020

The following additional information was made available before the year-end closing.

1.A physical count on 31 July 2020 revealed stocks on hand to be $81,330.

2. The commission income for April to August 2020 received is shown in the trial balance.

3. Rental payment of $24,000 relates to the period from June to August 2020.

4. Salaries for the accounting year were paid up to June 2020 only. Monthly salaries remained constant during the accounting year.

5. Payment of $3,700 for shipping goods to customers in July 2020 was not recorded.

6. Clement used his personal cheque to pay a credit supplier $19,000 and was given a 5% cash discount. The transaction was not recorded.

7.The 8% bank loan was taken on 1 August 2019. The interest expense has been paid to 31 January 2020.

8. Clement deposited a cheque of $9,500 which was received from a credit customer into his personal bank account. This transaction has been recorded in the correct accounts but on the opposite sides.

9.Annual depreciation on fixed assets was as follows:

Required:

a. Prepare the necessary general journal entries to record transactions (2) to (9). Narrations are not required.

(Hint: For some transactions, you will need to create new accounts which are not shown on the trial balance.)

b. Prepare the following financial statements for Joy Co.:

(i)  Statement of Comprehensive Income for the year ended 31 July 2020

(ii) Statement of Financial Position as of 31 July 2020