Financial Accounting: Statement of Profit or Loss (Coursework Sample)

Problem 1.0
The following information was extracted from the books of James May, a sole trader as at 31st August 2020.
£
Buildings (Cost) 1,800,000
Salaries and Wages 1,000,600
Office furniture 264,500
Cash at Bank 840,000
Cash in hand 184,600
Accounts payable 1,320,000
Equipment 48,000
Telephone and postage 66,400
Stationery and postage 36,300
Office expenses 92,300
Carriage inwards 120,700
Transport and expenses 690,900
Rent received 240,000
Sales returns 245,800
Account Receivables 3,880,200
Discount received 40,400

Insurance premiums 72,600
Allowance for bad and doubtful debts (1st September 2019 180,000
Bad debts written off 80,200
Inventory (1st September 2019( 680,400
Return outwards 148,200
Sales 10,125,400
Purchases 6,100,000
Drawings 850,300
Capital 5000,000
Additional information:
1. Inventory remaining as at 31st August 2020 was valued at £880,600.
2. Insurance paid out in advance as at 31st August 2020 amounted to £16,600.
3. Depreciation is to be provided on cost as follows:
a. Buildings 2.5% per annum.
b. Equipment 20% on cost.
c. Office furniture 10% per annum.
4. Salaries outstanding as at 31st August 2020 amounted to £40,200.
5. Allowance for doubtful debts is to be maintained at 5% of the outstanding debts.
6. Rent receivable as at 31st August 2020 amounted to £22,500.
7. Mr. May discovered that one invoice for £80,000 received from a supplier in July 2020 has not been entered in the books.
Required- Statement of profit or loss for the year ended 31st August 2020