Balance Sheet example question -indirect accounting approach

 Hyperlink Co. ltd carried out the following transactions in the year 2018.

(a.) Paid insurance in cash for its properties for eight months amounting to $160,000. The    monthly rate was $20,000

 (b.) Paid rent expenses for one year amounting to $150,000 by check

 (c.) Paid advertisement expense of $540,000 to cover one and half year’s period by check.

 (d.) Received commission income of $100,000 by check for ten month’s period

Required;

For each case;

Record the above transactions in the respective ledger accounts

Prepare profit and loss accounts for the year ended 31/12/2018

Extract balance sheet as at 31/12/2018

 

NB: Hint; use the indirect accounting approach

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