1
A Bloggs, a building contractor, had a wooden store shed and a brick-built office which
have balances b/d in the books of £850 and £179,500 respectively. During the year, the wooden
shed was pulled down at a cost of £265, and replaced by a brick building. Some of the timber from
the old store shed was sold for £180 and the remainder, valued at £100, was used in making door
frames, etc., for the new store. The new brick-built store was constructed by the builder’s own
employees, the expenditure thereon being materials (excluding timber from the old store shed)
£4,750; wages £3,510; and direct expenses of £85.
At about the same time, certain repairs and alterations were carried out to the office, again
using the builder’s own materials, the cost of which was: wages £290 and materials £460. It
was estimated that £218 of this expenditure, being mainly that incurred on providing additional
windows, represented improvements, 50% of this was wages, 50% materials.
Required:
Prepare the following four ledger accounts as they would appear after giving effect to all the
above matters:
(a) Wooden store shed account
(b) Office buildings account
(c) New store account
(d) Office buildings repairs account