Exercise 1

The following trial balance was extracted from the books of ZEBRA Enterprise on 31/12/2019:
Debit (000) Credit (000)
Details
FCFA FCFA
Capital - 100,000
Drawings 6,000 -
Inventory (stock) on 01/01/2019 49,600 -
Purchases 290,000 -
Sales - 360,000
Transport equipment 10,000 -
Sundry debtors 40,000 -
Trade expenses 500 -
Salaries 5,500 -
Rents 2,400 -
Advertising expenses 5,000 -
Commission - 1,300
Discount 200 -
Bad debts 1,600 -
Provision for bad debts - 900
Creditors - 20,000
Cash in hand 15,200 -
Insurance premium 400 -
Cash at bank 15,800 -
Returns 50,000 30,000
Goodwill at cost 20,000 -
Total 512,200 512,200
Additional Information:
- Value of Inventory (stock) as at 31/12/2019 amounted to 53,000,000 FCFA.
- Salaries have been paid only for 11 months. One month salary of 500,000 FCFA is still
owed.
- Prepaid insurance as at 31/12/2019 sum up to 100,000 FCFA.
- Accrued commission is valued at 122,000 FCFA.
- Provision for bad debts is to be brought up to 3% of sundry debtors.
- The manager is to be allowed a commission of 3,752,000 FCFA.
- Transport equipment is depreciated at a constant rate of 10%.
- 3,750,000 FCFA of advertisement expenses have been paid in advance.
Required:
Using the vertical method:
a) Prepare the business statement of comprehensive income for the year ended 31/12/2019.
b) Prepare a statement of financial position of the business as at 31/12/2019.
Exercise 2

The following trial balance was extracted from the books of ZEBRA Enterprise on 31/12/2019:
Debit (000) Credit (000)
Details
CFAF CFAF
Capital - 100,000
Drawings 6,000 -
Inventory (stock) on 01/01/2019 49,600 -
Purchases 290,000 -
Sales - 360,000
Transport equipment 10,000 -
Sundry debtors 40,000 -
Trade expenses 500 -
Salaries 5,500 -
Rents 2,400 -
Advertising expenses 5,000 -
Commission - 1,300
Discount 200 -
Bad debts 1,600 -
Provision for bad debts - 900
Creditors - 20,000
Cash in hand 15,200 -
Insurance premium 400 -
Cash at bank 15,800 -
Returns 50,000 30,000
Goodwill at cost 20,000 -
Total 512,200 512,200
Additional Information:
- Value of Inventory (stock) as at 31/12/2019 amounted to 53,000,000 CFAF.
- Salaries have been paid only for 11 months. One month salary of 500,000 CFAF is still owed.
- Prepaid insurance as at 31/12/2019 sum up to 100,000 CFAF.
- Accrued commission is valued at 122,000 CFAF.
- Provision for bad debts is to be brought up to 3% of sundry debtors.
- The manager is to be allowed a commission of 3,752,000 CFAF.
- Transport equipment is depreciated at a constant rate of 10%.
- 3,750,000 CFAF of advertisement expenses have been paid in advance.
Required:
Using the vertical method:
c) Prepare the business statement of comprehensive income for the year ended 31/12/2019.
d) Prepare a statement of financial position of the business as at 31/12/2019.
 Exercise 3
The following balances were extracted from the books of NEAKOR Enterprise as at 31st December
2019:
Elements Debit CFAF Credit CFAF
Purchases and sales 3,500,000 4,000,000
Sales / purchases returns 50,000 62,000
st
Opening stock at 1 January 2019 1,000,000
Provision for bad debts 8,000
Wages and salaries 300,000
Rates 70,000
Debtors and creditors 98,000 70,000
Capital 1,790,000
Bank balance 30,000
Drawings 180,000
Fittings at cost 400,000
Van at cost 300,000
Bad debts 2,000
Additional information:
- Closing stock at 31st December 2019 amounted to 1,200,000 CFAF
- Accrued wages amounted to 50,000 CFAF
- Prepaid rates amounted to 5,000 CFAF and outstanding rates amounted to 2,200 CFAF
- The provision for bad debts was to be increased to 10 % of debtors
- Depreciate fittings at 10 % per annum and van at 20 % per annum on cost.
Required:
a) Prepare a statement of comprehensive income for the ended 31st December 2019.
Prepare a statement of financial position as at 31st December 2019 .