Waec Model Questions Vol1 2022 Financial Accounting Question 22

The following ledger balances are recorded at year‑end before adjustments (all figures in naira): Debit balances: Cash 150,000; Accounts Receivable 80,000; Inventory 120,000; Prepaid Expenses 20,000; Equipment 200,000; Drawings 30,000. Credit balances: Accumulated Depreciation - Equipment 50,000; Accounts Payable 70,000; Salaries Payable 15,000; Capital 300,000. During the year the following adjustments are required: (i) Depreciation on equipment for the year - ₦25,000. (ii) One month of prepaid insurance (₦20,000 prepaid for 12 months) has expired. (iii) Physical inventory count shows ₦110,000. (iv) Bad debts written off - ₦5,000. (v) Salaries accrued at year‑end - ₦10,000. Prepare the trial balance after these adjustments and state the net profit for the year (assume the only revenue is Sales of ₦250,000, which is a credit entry).