Final Accounts 4: the Balance Sheet

Chapter 44

Final Accounts 4: The Balance Sheet

Textbook

Please refer to the information in the textbook for text-based answers.

4.(c)€16,000, positive

5.Brock Ltd

Balance Sheet on 31/12/11

Fixed assets / Cost
Premises / 145,000
Machinery / 36,000
Motor vehicles / 21,000 / 202,000
Current assets
Bank deposit account / 7,370
Less current liabilities
Bank overdraft / 4,600
Working capital / 2,770
Capital employed / 204,770
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 200,000 / 130,000
Retained profit / 4,770 / 134,770
10-year loan / 70,000
Capital employed / 204,770

6.Cartuir Ltd

Balance Sheet on 31/12/11

Fixed assets / Cost
Buildings / 165,000
Equipment / 41,500
Furniture / 11,000 / 217,500
Current assets
Closing stock / 23,890
Bank deposit account / 4,800 / 28,690
Less current liabilities
Bank overdraft / 13,100
Working capital / 15,590
Capital employed / 233,090
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 220,000 / 180,000
Retained profit / 18,090 / 198,090
5-year loan / 35,000
Capital employed / 233,090

7.Doohan Ltd

Balance Sheet on 31/12/11

Fixed assets / Cost
Land and buildings / 200,000
Motor vehicles / 24,000
Computers / 15,500 / 239,500
Current assets
Bank current account / 4,880
Cash / 1,400
Stock / 44,260
Bank deposit account / 17,320 / 67,860
Less current liabilities
0
Working capital / 67,860
Capital employed / 307,360
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 225,000 / 175,000
Retained profit / 32,360 / 207,360
8-year loan / 100,000
Capital employed / 307,360

8.Gray Ltd

Correction: Change machinery to €20,500

Balance Sheet on 31/12/11

Fixed assets / Cost
Premises / 79,000
Machinery / 20,500
Furniture and equipment / 24,000 / 123,500
Current assets
Bank deposit account / 2,450
Closing stock / 6,000 / 8,450
Less current liabilities
Bank overdraft / 11,200
Working capital / (2,750)
Capital employed / 120,750
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 150,000 / 110,000
Retained profit / 10,750 / 120,750
Capital employed / 120,750

9.Davis Ltd

Correction: Change authorised share capital to €550,000

Balance Sheet on 31/12/11

Fixed assets / Cost
Premises / 345,000
Machinery / 156,000
Motor vehicles / 45,000 / 546,000
Current assets
Bank deposit account / 8,900
Closing stock / 21,000 / 29,900
Less current liabilities
Bank overdraft / 2,400
Working capital / 27,500
Capital employed / 573,500
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 550,000 / 450,000
Retained profit / 33,500 / 483,500
8-year loan / 90,000
Capital employed / 573,500

10.Cambridge Ltd

Correction: Change authorised share capital to €420,000

Balance Sheet on 31/12/11

Fixed assets / Cost
Buildings / 247,000
Equipment / 56,500
Furniture / 40,000 / 343,500
Current assets
Stock / 31,750
Bank deposit account / 27,900 / 59,650
Less current liabilities
Bank overdraft / 24,500
Working capital / 35,150
Capital employed / 378,650
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 420,000 / 280,000
Retained profit / 18,650 / 298,650
9-year loan / 80,000
Capital employed / 378,650

11.Kilkenny Ltd

Balance Sheet on 31/12/11

Fixed assets / Cost
Land and buildings / 140,000
Motor vehicles / 100,000
Fixtures and fittings / 9,000 / 249,000
Current assets
Debtors / 12,000
Cash in hand / 3,000
Cash at bank / 9,900
Stock / 20,000 / 44,900
Less current liabilities
Creditors / 12,000
Working capital / 32,900
Capital employed / 281,900
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 250,000 / 190,000
Retained profit / 51,900 / 241,900
10-year loan / 40,000
Capital employed / 281,900

12.Mason Ltd

Balance Sheet on 31/12/11

Fixed assets / Cost
Plant and equipment / 96,000
Furniture and fittings / 46,700
Motor vehicles / 23,000 / 165,700
Current assets
Debtors / 16,780
Cash in hand / 1,500
Stock / 8,900 / 27,180
Less current liabilities
Creditors / 16,780
Bank overdraft / 12,900 / 29,680
Working capital / (2,500)
Capital employed / 163,200
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 180,000 / 150,000
Retained profit / 13,200 / 163,200
Capital employed / 163,200

13.O’Keefe Ltd

Balance Sheet on 31/12/11

Fixed assets / Cost
Buildings / 250,000
Furniture and equipment / 120,000
Motor vehicles / 45,000 / 415,000
Current assets
Debtors / 24,670
Stock / 34,500
Bank deposit account / 12,000
Cash on hand / 2,300 / 73,470
Less current liabilities
Creditors / 24,670
Working capital / 48,800
Capital employed / 463,800
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 500,000 / 440,000
Retained profit / 23,800 / 463,800
Capital employed / 463,800

14.Troy Ltd

Balance Sheet on 31/12/11

Fixed assets
Premises / 146,000
Furniture and equipment / 34,500
Motor vehicles / 24,000 / 204,500
Current assets
Debtors / 27,200
Cash in hand / 2,900
Stock / 18,400 / 48,500
Less current liabilities
Creditors / 27,200
Bank overdraft / 22,400 / 49,600
Working capital / (1,100)
Capital employed / 203,400
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 200,000 / 128,000
Retained profit / 10,400 / 138,400
15-year loan / 65,000
Capital employed / 203,400

15.O’Donnell Ltd

Balance Sheet on 31/12/11

Fixed assets
Buildings / 347,000
Furniture and equipment / 210,000
Motor vehicles / 51,000 / 608,000
Current assets
Debtors / 25,000
Stock / 26,700
Bank deposit account / 23,600
Cash on hand / 1,800 / 77,100
Less current liabilities
Creditors / 25,000
Working capital / 52,100
Capital employed / 660,100
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 700,000 / 550,000
Retained profit / 110,100 / 660,100
Capital employed / 660,100

16.June Ltd

Balance Sheet on 31/12/11

Fixed assets
Premises / 330,000
Furniture and equipment / 55,600
Motor vehicles / 35,000 / 420,600
Current assets
Debtors / 27,200
Cash in hand / 3,700
Stock / 27,900 / 58,800
Less current liabilities
Creditors / 27,200
Bank overdraft / 32,100 / 59,300
Working capital / (500)
Capital employed / 420,100
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 350,000 / 280,000
Retained profit / 55,100 / 335,100
15-year loan / 85,000
Capital employed / 420,100

17.Gallagher Ltd

Trading, P&L and Appropriation Account for Y/E 31/12/11

Sales / 51,600
Less cost of sales
Opening stock / 7,600
Purchases / 29,500
Carriage inwards / 520
37,620
Less closing stock / 8,400 / 29,220
Gross profit / 22,380
Less expenses and losses
Light and heat / 1,700
Wages and salaries / 6,100
Telephone expenses / 1,700
Carriage outwards / 780
Advertising / 3,400
General expenses / 6,400 / 20,080
Retained profit / 2,300

Balance Sheet on 31/12/11

Fixed assets
Buildings / 48,000
Equipment / 22,800
Motor vehicles / 28,000 / 98,800
Current assets
Cash on hand / 600
Closing stock / 8,400 / 9,000
Less current liabilities
Bank overdraft / 5,500
Working capital / 3,500
Capital employed / 102,300
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 150,000 / 90,000
Retained profit / 2,300 / 92,300
Long-term loan / 10,000
Capital employed / 102,300

18.McGoldrick Ltd

Trading, P&L and Appropriation Account for Y/E 31/12/11

Sales / 103,400
Less cost of sales
Opening stock / 11,400
Purchases / 68,700
Import duties / 1,300
81,400
Less closing stock / 15,000 / 66,400
Gross profit / 37,000
Less expenses and losses
Light and heat / 3,900
Insurance / 6,450
Carriage out / 1,100
Repairs / 3,200
Office expenses / 6,300 / 20,950
Net profit / 16,050
Less dividends / 12,000
Retained profit / 4,050

Balance Sheet on 31/12/11

Fixed assets
Motor vehicles / 27,000
Premises / 126,000 / 153,000
Current assets
Cash on hand / 1,400
Closing stock / 15,000 / 16,400
Less current liabilities
Bank overdraft / 6,350
Working capital / 10,050
Capital employed / 163,050
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 200,000 / 159,000
Retained profit / 4,050 / 163,050
Capital employed / 163,050

19.Redmond Ltd

Trading, P&L and Appropriation Account for Y/E 31/12/11

Sales / 87,950
Less cost of sales
Opening stock / 8,600
Purchases / 47,600
Carriage inwards / 350
56,550
Less closing stock / 16,000 / 40,550
Gross profit / 47,400
Less expenses and losses
Wages / 3,000
Administration expenses / 7,400
Rent and rates / 5,500
Marketing and advertising / 8,400
Office expenses / 2,700 / 27,000
Net profit / 20,400
Less dividends / 10,000
Retained profit / 10,400

Balance Sheet on 31/12/11

Fixed assets
Buildings / 150,000
Equipment / 66,800 / 216,800
Current assets
Bank / 24,000
Cash in hand / 1,600
Closing stock / 16,000 / 41,600
Less current liabilities / 0
Working capital / 41,600
Capital employed / 258,400
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 300,000 / 230,000
Retained profit / 10,400 / 240,400
Long-term loan / 18,000
Capital employed / 258,400

20.Cool Interiors

Trading, P&L and Appropriation Account for Y/E 31/12/11

Sales / 101,800
Less cost of sales
Opening stock / 5,800
Purchases / 41,500
Carriage inwards / 500
47,800
Less closing stock / 9,200 / 38,600
Gross profit / 63,200
Less expenses and losses
Bank interest / 1,800
Carriage outwards / 750
Light and heat / 3,750
Sundry expenses / 4,400
Audit fees / 1,700
Wages and salaries / 7,200
Insurance / 4,800 / 24,400
Net profit / 38,800
Less dividends / 8,000
Retained profit / 30,800

Balance Sheet on 31/12/11

Fixed assets
Buildings / 88,000
Furniture and fittings / 24,000
Equipment / 18,000 / 130,000
Current assets
Cash / 400
Closing stock / 9,200 / 9,600
Less current liabilities
Bank overdraft / 14,800
Working capital / (5,200)
Capital employed / 124,800
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 120,000 / 94,000
Retained profit / 30,800 / 124,800
Capital employed / 124,800

21.Glynn Gardiner Ltd

Trading, P&L and Appropriation Account for Y/E 31/12/11

Sales / 284,800
Less cost of sales
Opening stock / 21,400
Purchases / 170,500
Custom duties / 1,750
193,650
Less closing stock / 24,000 / 169,650
Gross profit / 115,150
Add rent received / 1,850
117,000
Less expenses and losses
Wages and salaries / 24,800
Insurance / 16,750
Rent and rates / 11,950
Administration expenses / 16,400
Office expenses / 2,700 / 72,600
Net profit / 44,400

Balance Sheet on 31/12/11

Fixed assets
Buildings and land / 84,000
Machinery / 48,000
Equipment / 22,000
Motor vehicles / 16,500 / 170,500
Current assets
Cash in hand / 400
Closing stock / 24,000 / 24,400
Less current liabilities
Bank overdraft / 6,500
Working capital / 17,900
Capital employed / 188,400
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 300,000 / 144,000
Retained profit / 44,400 / 188,400
Capital employed / 188,400

22.Russell Morgan Ltd

Trading, P&L and Appropriation Account for Y/E 31/12/11

Sales / 192,500
Less cost of sales
Opening stock / 12,500
Purchases / 76,000
Carriage inwards / 2,500
91,000
Less closing stock / 15,000 / 76,000
Gross profit / 116,500
Add rent received / 3,500
120,000
Less expenses and losses
Insurance / 2,450
Sundry expenses / 11,100
Telephone / 450
Rent and rates / 4,700
Wages / 20,000
Advertising / 3,300
Postage and stationery / 1,700 / 43,700
Net profit / 76,300

Balance Sheet on 31/12/11

Fixed assets
Buildings / 160,000
Machinery / 42,000
Equipment / 12,000 / 214,000
Current assets
Closing stock / 15,000
Less current liabilities
Bank overdraft / 2,700
Working capital / 12,300
Capital employed / 226,300
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 250,000 / 150,000
Retained profit / 76,300 / 226,300
Capital employed / 226,300

Workbook

1.Dandrillow Ltd

Trading, P&L and Appropriation Account for Y/E 31/12/11

Sales / 236,580
Less cost of sales
Opening stock / 23,500
Purchases / 76,500
Import duties / 2,700
102,700
Less closing stock / 24,000 / 78,700
Gross profit / 157,880
Less expenses and losses
Insurance / 9,780
Light and heat / 8,400
Carriage outwards / 5,500
Repairs / 8,100
Office expenses / 26,300 / 58,080
Net profit / 99,800
Less dividends paid / 16,000
Retained profit / 83,800

Balance Sheet on 31/12/11

Fixed assets / Cost
Premises / 216,000
Motor vehicles / 56,000 / 272,000
Current assets
Closing stock / 24,000
Cash / 2,300 / 26,300
Less current liabilities
Bank overdraft / 14,500
Working capital / 11,800
Capital employed / 283,800
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 400,000 / 200,000
Retained profit / 83,800
Capital employed / 283,800

2.Patrick Ltd

Trading, P&L and Appropriation Account for Y/E 31/12/11

Sales / 194,550
Less cost of sales
Opening stock / 12,500
Purchases / 55,400
Carriage inwards / 1,250
69,150
Less closing stock / 25,000 / 44,150
Gross profit / 150,400
Less expenses and losses
Wages / 34,000
Administration expenses / 39,500
Rent and rates / 26,600
Marketing and advertising / 18,600
Office expenses / 6,300 / 125,000
Net profit / 25,400
Less dividends paid / 12,000
Retained profit / 13,400

Balance Sheet on 31/12/11

Fixed assets / Cost
Buildings / 195,000
Equipment / 82,000 / 277,000
Current assets
Closing stock / 25,000
Bank / 32,000
Cash / 4,400 / 61,400
Less current liabilities / 0
Working capital / 61,400
Capital employed / 338,400
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 400,000 / 260,000
Retained profit / 13,400 / 273,400
Long-term loan / 65,000
Capital employed / 338,400

3.Reddy Ltd

Trading, P&L and Appropriation Account for Y/E 31/12/11

Sales / 196,000
Less sales returns / 2,600 / 193,400
Less cost of sales
Opening stock / 8,900
Purchases / 54,000
Import duties / 3,700
66,600
Less closing stock / 21,300 / 45,300
Gross profit / 148,100
Add rent received / 6,600
154,700
Less expenses and losses
Salaries andwWages / 18,300
Selling expenses / 7,100
Advertising / 2,600
Insurance / 3,900
Bad debts / 2,400
Motor van repairs / 1,700 / 36,000
Net profit / 118,700
Less dividends paid / 10,000
Retained profit / 108,700

Balance Sheet on 31/12/11

Fixed assets / Cost
Land and buildings / 270,000
Equipment / 45,000
Furniture and fittings / 18,000 / 333,000
Current assets
Closing stock / 21,300
Bank deposit account / 9,600
Debtors / 17,650 / 48,550
Less current liabilities
Bank overdraft / 13,950
Creditors / 13,900 / 27,850
Working capital / 20,700
Capital employed / 353,700
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 400,000 / 220,000
Retained profit / 108,700 / 328,700
Long-term loan / 25,000
Capital employed / 353,700

4.Corinna Ltd

Trading, P&L and Appropriation Account for Y/E 31/12/11

Sales / 230,000
Less sales returns / 4,000 / 226,000
Less cost of sales
Opening stock / 12,850
Purchases / 85,000
Less purchases returns / 2,500 / 82,500
Carriage inwards / 2,000
97,350
Less closing stock / 31,500 / 65,850
Gross profit / 160,150
Less expenses and losses
Carriage outwards / 3,000
Telephone and postage / 1,700
Marketing and advertising / 5,850
Salaries / 33,000
Distribution expenses / 6,900
Electricity / 2,700 / 53,150
Net profit / 107,000
Less dividends paid / 27,000
Retained profit / 80,000

Balance Sheet on 31/12/11

Fixed assets / Cost
Premises / 190,000
Motor vehicles / 35,000
Equipment / 24,000 / 249,000
Current assets
Closing stock / 31,500
Bank deposit account / 8,700
Cash / 1,000
Debtors / 22,500 / 63,700
Less current liabilities
Bank overdraft / 3,400
Creditors / 14,800 / 18,200
Working capital / 45,500
Capital employed / 294,500
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 400,000 / 140,000
Retained profit / 80,000 / 220,000
Long-term loan / 74,500
Capital employed / 294,500

5.Dodder Ltd

Trading, P&L and Appropriation Account for Y/E 31/12/11

Sales / 454,000
Less sales returns / 11,500 / 442,500
Less cost of sales
Opening stock / 37,000
Purchases / 224,000
Less purchases returns / 9,000 / 215,000
Import duties / 2,700
254,700
Less closing stock / 41,000 / 213,700
Gross profit / 228,800
Add interest received / 500
229,300
Less expenses and losses
Postage and telephone / 5,040
Electricity / 10,600
Insurance / 4,950
Salaries and wages / 38,900 / 59,490
Net profit / 169,810
Less dividends paid / 30,000
Retained profit / 139,810

Balance Sheet on 31/12/11

Fixed assets / Cost
Premises / 208,000
Motor vehicles / 44,000
Equipment / 27,000 / 279,000
Current assets
Closing stock / 41,000
Bank deposit account / 8,900
Cash / 250
Debtors / 42,500 / 92,650
Less current liabilities
Creditors / 51,840
Working capital / 40,810
Capital employed / 319,810
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 500,000 / 150,000
Retained profit / 139,810 / 289,810
Long-term loan / 30,000
Capital employed / 319,810

6.Elder Ltd

Trading, P&L and Appropriation Account for Y/E 31/12/11

Sales / 295,450
Less sales returns / 6,400 / 289,050
Less cost of sales
Opening stock / 16,900
Purchases / 98,000
Import duties / 5,900
120,800
Less closing stock / 43,500 / 77,300
Gross profit / 211,750
Add interest received / 12,500
224,250
Less expenses and losses
Salaries and wages / 35,800
Selling expenses / 9,200
Advertising / 14,600
Insurance / 8,400
Bad debts / 1,500
Motor van repairs / 4,900 / 74,400
Net profit / 149,850
Less dividends paid / 20,000
Retained profit / 129,850

Balance Sheet on 31/12/11

Fixed assets / Cost
Land and buildings / 315,000
Equipment / 56,000
Furniture and fittings / 45,000 / 416,000
Current assets
Closing stock / 43,500
Bank deposit account / 23,800
Debtors / 24,550 / 91,850
Less current liabilities
Bank overdraft / 24,500
Creditors / 18,500 / 43,000
Working capital / 48,850
Capital employed / 464,850
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 500,000 / 270,000
Retained profit / 129,850 / 399,850
Long-term loan / 65,000
Capital employed / 464,850

7.Edfu Ltd

Trading, P&L and Appropriation Account for Y/E 31/12/11

Sales / 340,000
Less sales returns / 6,000 / 334,000
Less cost of sales
Opening stock / 18,500
Purchases / 165,000
Less purchases returns / 10,240 / 154,760
Carriage inwards / 3,200
176,460
Less closing stock / 22,500 / 153,960
Gross profit / 180,040
Less expenses and losses
Carriage outwards / 4,800
Telephone and postage / 4,500
Marketing and advertising / 15,700
Salaries / 53,000
Electricity / 13,540
Distribution expenses / 37,800 / 129,340
Net profit / 50,700
Less dividends paid / 25,000
Retained profit / 25,700

Balance Sheet on 31/12/11

Fixed assets / Cost
Premises / 250,000
Motor vehicles / 55,000
Equipment / 54,000 / 359,000
Current assets
Closing stock / 22,500
Debtors / 41,400
Bank deposit account / 15,000
Cash / 4,000 / 82,900
Less current liabilities
Creditors / 36,800
Bank overdraft / 9,400 / 46,200
Working capital / 36,700
Capital employed / 395,700
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 500,000 / 280,000
Retained profit / 25,700 / 305,700
Long-term loan / 90,000
Capital employed / 395,700

8.Murphy Ltd

Trading, P&L and Appropriation Account for Y/E 31/12/11

Sales / 606,770
Less sales returns / 18,900 / 587,870
Less cost of sales
Opening stock / 33,000
Purchases / 288,000
Less purchases returns / 23,000 / 265,000
Import duties / 5,600
303,600
Less closing stock / 54,000 / 249,600
Gross profit / 338,270
Add interest received / 3,340
341,610
Less expenses and losses
Postage and telephone / 6,500
Electricity / 18,900
Insurance / 23,880
Salaries and wages / 78,600 / 127,880
Net profit / 213,730
Less dividends paid / 40,000
Retained profit / 173,730

Balance Sheet on 31/12/11

Fixed assets / Cost
Premises / 350,000
Motor vehicles / 65,000
Equipment / 65,000 / 480,000
Current assets
Closing stock / 54,000
Debtors / 56,780
Bank deposit account / 15,900
Cash on hand / 950 / 127,630
Less current liabilities
Creditors / 75,900
Working capital / 51,730
Capital employed / 531,730
Financed by
Share capital / Authorised / Issued
€1 ordinary shares / 500,000 / 260,000
Retained profit / 173,730 / 433,730
Long-term loan / 98,000
Capital employed / 531,730

9.(a)Trading a/c

(b)P&L a/c and balance sheet

(c)Balance sheet

(d)Trading a/c

(e)Trading a/c and balance sheet

(f)P&L a/c

10.(b)Plant and machinery

11.€49,400

12.See textbook

1