Preparethe income statement of hyper star

Question

Mr. Ali is running "Hyper StarTraders" a sole proprietorship business located at the Mall Road,Lahore. At the year end the business has:

Furniture Rs.40,000

Plant 200,000

Capital 280,000

On 30^{th November 2009 Mr.Ali submitted a tender for sale of goods of Rs. 20,000 which islikely to be confirmed shortly. Bank debited service charges Rs.150 and interest on loan Rs. 500 and credited dividend for Rs.2,000 in the month of December (intimation from bank was receivedon 7th January 2010). Mr. Ali also estimates that 5% of the amountwill not be collectable from sundry debtors. House rent allowanceRs. 5,000 has been paid on 31st December from his personal account,on the same date stock was valued at Rs. 200,000 and plant Rs.160,000 because of its wear and tear.}

^{The following balances (inthe books of Hyper Star Traders) are also given along with aboveinformation as on 31st December 2009:}

Particulars Rs. Particulars Rs.

Opening stock 120,000 Bankbalance 36,000

Sundry Debtors 100,000 Billspayable 20,000

Long term Investments 60,000Returns outwards 4,800

Returns inwards 8,000 Commission2,000

Purchases 680,000 Sales924,000

Cash in hand 4,000 Interestreceived 800

Bills receivable 44,000 SundryCreditors 160,000

Carriage out 3,600 Salaries48,000

Insurance paid 2,800 Wages45,200
Required:

A. Passnecessary adjusting entries. (15 marks)

B. Preparethe Income statement of Hyper Star Traders for the year ending on31st December, 2009. (15 marks)

C. Preparethe Balance sheet of Hyper Star Traders as on 31st December, 2009.