Answer :
1. Telephone Expenses (February) 4,000 Accounts Payable 4,000
2. Bad Debts Expense 3,000 Provision for Bad Debts 3,000
3. Increase in Trading Inventory 2,000 Cost of Sales 2,000
4. Increase in Stationery 1,000 Stationery Expense 1,000
5. Increase in Provision for Bad Debts 700 Provision for Bad Debts 700
6. Directors' Fees Expense 14,000 Accrued Directors' Fees 14,000
7. Prepaid Insurance 6,000 Insurance Expense 6,000
8. Mortgage Loan Interest Expense 9,800 Interest Payable (Mortgage Loan) 9,800
9. Fixed Deposit Interest Receivable 10,000 Interest Revenue (Fixed Deposit) 10,000
10. Depreciation Expense - Equipment 72,000 Accumulated Depreciation - Equipment 72,000
11. Depreciation Expense - Vehicles 37,600 Accumulated Depreciation - Vehicles 37,60012. Income Tax Expense 39,860 Income Tax Payable 39,860
1. The telephone expenses for February of R4,000 are recorded as an accounts payable.2. The account of the insolvent debtor, P. Martin, is written off, resulting in a bad debts expense of R3,000.
3. The stocktaking reveals an increase in trading inventory by R2,000, which is recorded as an expense in the cost of sales.4. The stocktaking reveals an increase in stationery by R1,000, which is recorded as an expense.
5. The provision for bad debts is increased by R700 to account for potential future bad debts.6. Directors' fees of R14,000 that were unpaid are accrued as an expense.
7. The prepaid insurance amount of R6,000 is recorded as an insurance expense.8. The outstanding interest on the mortgage loan, R9,800, is recognized as an interest expense.
9. The interest receivable on the fixed deposit of R10,000 is recognized as interest revenue.10. Depreciation expense of R72,000 is recorded for the equipment.
11. Depreciation expense of R37,600 is recorded for the vehicles.12. The income tax expense of R39,860 is recorded for the financial year.
(Note: The remaining adjustment regarding the dividend amount is not mentioned in the provided information.)
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