Insurance is paid on 1/7/2019 for 8,000 £. The policy covers the period until 31/6/2020
Rent for the year is 24,000 £. During the year, the company paid 23,000 £ to its landlord
ABC Ltd. employs 4 members of staff, each with a yearly salary of 45,500 £. At the end of
the year, ABC owes its staff one week of wages.
Inventories were bought for 35,000 £ in cash and 176,000 £ on credit.
Cash sales were 67,500 £ (cost of sales 32,000) and credit sales 383,400 (cost of sales
112,300).
A customer returned 5,700 £ worth of goods receiving a cash refund.
The company received payments of 343,500 £ from trade receivables. A customer paid
early and the company granted him a discount of 2,000 £.
ABC paid 134,600 £ towards trade payables.
Electricity expenses were 7,500 £ for the first three quarter of the year. The bill for Q4 will
be paid in January and the company expects electricity costs to be constant.
ABC paid 3% interest over its loan balance at the beginning of the year. Over the year, the
company paid back 20,000 £ to the bank.
ABC sold its vehicle in December for 15,000 £ in cash. Depreciation on the vehicle is
charged in full during the year.
Corporation tax is 20%. Taxes are paid 50% in arrears.
Vehicles are depreciated using the reducing balance method, with 30% yearly.
depreciation. Depreciation on machinery is 5,000 £ and on building 3,000 £.
ABC paid a dividend of 15,000 £ to shareholders.