Neco Model Questions Vol1 2024 Financial Accounting Question 9

Company XYZ's trial balance at 31 December 2024 includes the following items (all figures in ₦): - Sales Revenue - Credit (1,200,000) - Purchases - Debit (720,000) - Opening Stock - Debit (150,000) - Closing Stock - Credit (180,000) - Salaries Expense - Debit (200,000) - Rent Expense - Debit (80,000) - Machinery (cost) - Debit (500,000) - Accumulated Depreciation - Machinery - Credit (120,000) - Loan Payable - Credit (300,000) - Interest Expense (accrued) - Debit (15,000) - Accounts Receivable - Debit (250,000) - Bad Debts Expense - (to be estimated at 2 % of Accounts Receivable) - Dividend Paid - Debit (50,000) - Capital - Credit (600,000) - Drawings - Debit (40,000) Additional information: - Machinery is depreciated straight‑line over 10 years with a residual value of ₦(50,000); the current year's depreciation has not yet been recorded. - Bad debts are to be provided at 2 % of Accounts Receivable. - The loan bears interest at 5 % per annum, payable at year‑end; the accrued amount shown ((15,000)) is only a partial estimate. Prepare the statement of profit or loss for the year and compute the closing retained earnings, assuming there were no retained earnings carried forward.