1. It has been decided to revalue the land and buildings (carrying value $480,000 )to $720,000 at year end.
2. Trade receivables totalling $150,000 are to be written off.
3. During the year there was a contra settlement of $500 in which an amount due to a supplier was set off against the amount due from the same company for goods sold to it. No entry has yet been made to record the set-off.
4. Closing inventory $1,000,000. Some inventory items included in the draft statement of financial poistion at cost $70,400 were sold after the reporting date for $35,200, with selling expenses of $5,000.
Suggested solutions:
| DEBIT | CREDIT | AMOUNT | |
| 1. | Land and Buildings | Surplus in revaluation | 240,000 |
| 2. | Irrecoverable debt expenses | Trade receivable control | 150,000 |
| 3. | Trade payables control | Trade receivables control | 500 |
| 4. | Financial position Inventory | Income statement Inventory | 969,800 |