Incomplete Records – Net Worth M - Leaving Cert Accounting - Question 4 - 2013

To create a statement of Profit or Loss for the year ended 31/12/2012, we start with total assets and deduct liabilities:

Assets:

• Estimated Total Assets: €960,000

Less: Depreciation

• Depreciation of Furniture and Equipment (15%): $ext{Depreciation} = 9000 imes 0.15 = €1,350$
• Depreciation of Motor Vehicles (10%): $ext{Depreciation} = 43500 imes 0.10 = €4,350$

Total Depreciation:

$ext{Total Depreciation} = 1350 + 4350 = €5,700$

Adjusted Total Assets:

$ext{Total Assets after Depreciation} = 960000 - 5700 = €943,300$

Liabilities:

• Liabilities: €80,000
• Expenses due: €2,700

Total Liabilities:

$ext{Total Liabilities} = 80000 + 2700 = €80,700$

Net Worth on 31/12/2012:

$ext{Net Worth on 31/12/2012} = 943300 - 80700 = €862,600$

Drawings:

• Drawings: €6,400
• Repairs: €3,500
• Stock: €2,510

Summation of Drawings:

$ext{Total Drawings} = 6400 + 3500 + 2510 = €12,410$

Net Profit for the Year:

$ext{Net Profit} = ext{Net Worth on 31/12/2012} - ext{Drawings}$ $ext{Net Profit = } 862600 - 12410 = €850,190$

Thus, the Net Profit for the year 2012 is €162,510.