Martha Crooks runs a second-hand furniture store from a shop which she rents. She does not
keep complete accounting records but is able to provide you with the following information
about her financial position at January 1 2016: inventory of furniture $3,210; Trade accounts
receivable $2,643; Trade accounts payable $1,598; Truck $5,100; Fixtures and Fittings $4,200,
Truck expenses owing $432.

She also provided a summary of her bank account for the year ended December 2016.
$ $
Balance b/d at Jan 1 2015 2,420 Payments of trade payables 22,177

Cheques received from trade receivables $44,846
Cash sales $3,921

Electricity $1.090
Telephone $360
Rent $ 2000
Advertising & Promotion $1430
Fixtures and Fittings $2550
Insurance $946
Truck expenses $ 2116
Drawings $16,743
Balance at Dec 31 2016 $1775

All cash and cheques received were paid into the bank account immediately.
Additional information:
1. Depreciation is to be written-off the trucks at 20% and off the Fixtures and Fitting at
10 %, calculated on the book values at Jan 1, 2016 plus additions during the year.
2. At Dec 31 2016, truck expenses owing were $291, and insurance paid in advance was
$177

3. Included in the amount paid for Fixtures and fittings were:
A table bought for $300, which Crooks resold during the year at cost, some wooden
shelving (cost $250), which Crooks used in building an extension to her house,
Other balances at 31 December 31 2016 were:

$
Trade accounts receivable 4,021
Trade accounts payable 2,445
Inventory of furniture 4,063

Required:
A. Prepare the following for the year ended 31 December 2016
i. Statement of Affairs (8 marks)
ii. Accounts payable and Accounts receivable accounts (14 marks)
iii. Income Statement (21 marks)
iv. Balance sheet