Account Debit Credit
Bank charges 1 300  
Cleaning 1 500  
Computer equipment 12 500  
Cost of sales 32 000  
Credit losses 420  
Depreciation 2 300  
Fuel and oil 56 000  
Garden maintenance 1 300  
Goods sold   125 000
Interest on loan 2 600  
Interest received   5 800
Municipal services 6 850  
Printing and stationery 16 715  
Repairs and maintenance: Building 5 200  
Repairs and maintenance: Vehicles 6 850  
Salaries and wages 35 850  
Services rendered   560 000
Staff welfare 650  
Telephone 18 600  
Capital: Mr Richard   450 000
Capital: Mr Lionel   375 000
Drawings: Mr Richard 35 000  
Drawings: Mr Lionel 27 000  
Current account: Mr Richard 2 500  
Current account: Mr Lionel   6 400
Retained income   42 500
Land 400 000  
Buildings 850 000  
Accumulated depreciation on buildings   21 000
Vehicles 130 000  
Accumulated depreciation on vehicles   65 000
Equipment and electronics 52 000  
Accumulated depreciation on equipment and electronics   2 200
11% Long-term loan   156 000
Bank: FNB 2 500  
Bank: ABSA 125 665  
Debtors control account 60 000  
Allowance for credit losses   7 400
Creditors control account   90 000
Petty cash 5 600  
Inventory: Stationery 4 000  
Inventory: Materials 25 000  
SARS: Provisional Tax paid 15 000  
SARS: VAT   5 600
SARS: Tax payable                                            23 000  
  1 934 900 1 934 900

Additional information
The partnership agreement stipulates that:
1. Interest of 3,5% is paid to the partners on the current account balances as at the first day of the financial year.
2. The interest on the capital accounts is calculated at 13%. Mr Richard contributed an additional R150 000 on his capital account on 1 July 2022, while Mr Lionel reduced his capital with R25 000 on the same date.
3. Mr Richard is entitled to a bonus of R75 000 before any profit shares are calculated. He opted to have it set-off against his drawings account annually. The bonus has not been awarded yet.
4. The partners share profits equally. Due to the set-off in the drawings accounts the agreement stipulate that partners can roll their drawings balances for a maximum of 6 months into the new financial year. You can assume that the profits before appropriations amounted to R425 000.

The following transactions have not been accounted for:
1. The computer equipment purchased during the year was debited to the computer equipment expense account. The items were purchased on the last day of the financial year and should be depreciated at 33%.
2. The final income tax assessment was received and recorded at R23 000. Provisional tax payments have been recorded for the year.
3. Defective materials inclusive of VAT at 15% to the value of R1 500 was returned to a supplier. A debit note was received but the transaction has not been recorded yet.
4. A customer returned goods sold for R5 300 for a credit on her account. The company has a 15% markup policy.
5. Mr. Richard’s bank card has been stolen and he needed to settle the school account on/before the examinations could be finalised. The partners agreed that the payment could

be affected by the accountant. The debit of R 5 000 was passed to the salaries and wages account.
6. The loan is repayable in 3 equal instalments with the first instalment due on 30 June 2023.

Record the additional information transactions in the general journal for the year ended 31 December 2022. (30)

Prepare the statement of changes in equity of XYZ Traders as at 31 December 2022. (20)

Get answers on above questions on Accounting

Answer 1: 

The statement of changes in equity of XYZ Traders as at 31 December 2022 is prepared as follows:


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