Luthuli Electronics Ltd. commenced business on 1 April 1999, selling television sets both on a cash basis and by instalments. Hire purchase sales require a deposit of one-third of the cash selling price with the balance payable in 18 equal monthly instalments. No additional charge is made for this service. At the end of each financial year the firm takes credit for the profit instalment sales only in respect of the proportion represented by deposit and instalments actually reserved.
The following transactions took place during the two yeas ended 31 March 2000 and 2001:
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|
2000
Shs.
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2001
Shs.
|
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Cash sales
Instalment sales
New TV sets purchased
Cash collections or instalment contracts:
Initial deposit
Monthly instalments 2000 sales
2001 sales
Stocks at 31 March:
New TV sets at cost
|
9,606,600
84,893,400
69,300,000
Shs.
28,297,800
19,323,900
16,380,000
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13,131,000
119,394,000
75,119,700
Shs.
39,798,000
27,623,700
25,182,000
21,604,500
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Required:
(i) Trading accounts in respect of cash sales for each of the years ended 31 March 2000 and 31 March 2001 respectively.
(ii) Show the gross profit on hire purchase sales for each of the years ended 31 March 2000 and 31 March 2001.