Gce Model Questions Vol1 2020 Financial Accounting Question 5

The following excerpt from a trial balance (all figures in \(\text{₦}\)) is given for XYZ Ltd.\n\nCash \(12{,}000\)\nDebtors \(18{,}000\)\nInventory \(25{,}000\)\nPrepaid Insurance \(3{,}600\)\nEquipment (cost) \(40{,}000\)\nAccumulated Depreciation - Equipment \(8{,}000\) (credit)\nCreditors \(15{,}000\)\nBank Loan (long term) \(20{,}000\)\nShare Capital \(30{,}000\)\nRetained Earnings (b/f) \(10{,}000\)\nSales Revenue \(80{,}000\)\nCost of Goods Sold \(45{,}000\)\nSalaries Expense \(12{,}000\)\nRent Expense \(6{,}000\)\nInsurance Expense \(2{,}400\)\n\nAdditional information:\n- Equipment has a useful life of 8 years, no residual value; it was purchased at the start of the year.\n- An insurance policy of \(\text{₦}3{,}600\) was paid on 1 July for 12 months.\n- Utilities of \(\text{₦}1{,}200\) have been incurred but not yet recorded.\n\nPrepare the adjusted trial balance for the items above, calculate the gross profit and net profit for the year, and state the current ratio (Current Assets ÷ Current Liabilities) rounded to two decimal places.