Prepare a cash book, showing how the transactions that took place in the year should be accounted. Prepare a trial balance as at 31 December 2017.

To prepare the cash book and trial balance, we need to account for the transactions provided. (a) Cash Book Preparation Cash Receipts: Cash sales: K'000 700 Receipts from receivables: K'000 1,700 Cash Payments: Payments to suppliers: K'000 800 Salaries: K'000 280 Administration expenses: K'000 300 Distribution costs: K'000 170 Loan repayment: K'000 200 Cash Book: \[ |c|c|c| Date & Details & Amount (K'000) \\ Receipts & Cash sales & 700 \\ & Receipts from receivables & 1,700 \\ Payments & Payments to suppliers & 800 \\ & Salaries & 280 \\ & Administration expenses & 300 \\ & Distribution costs & 170 \\ & Loan repayment & 200 \\ \] Net Cash Flow: \[ Total Receipts = 700 + 1,700 = 2,400 \] \[ Total Payments = 800 + 280 + 300 + 170 + 200 = 1,750 \] \[ Net Cash Flow = 2,400 - 1,750 = 650 \] (b) Trial Balance as at 31 December 2017 Assets: Non-current assets: K'000 1,460 Current assets (adjusted for transactions): Inventories: K'000 250 Receivables (after receipts): K'000 370 - 1,700 = (1,330) Prepayment: K'000 20 Bank (adjusted for net cash flow): K'000 130 + 650 = 780 Liabilities: Non-current liabilities (Loan): K'000 600 Current liabilities: Payables: K'000 490 Accruals: K'000 120 Capital and Reserves: Capital: K'000 900 Profit: K'000 270 Drawings: K'000 (150) Trial Balance: \[ |c|c|c| Account & Debit (K'000) & Credit (K'000) \\ Non-current assets & 1,460 & \\ Inventories & 250 & \\ Receivables & & 1,330 \\ Prepayment & 20 & \\ Bank & 780 & \\ Loan & & 600 \\ Payables & & 490 \\ Accruals & & 120 \\ Capital & & 900 \\ Profit & & 270 \\ Drawings & 150 & \\ Total & 2,660 & 3,710 \\ \] The trial balance should balance, so double-check calculations and ensure all transactions are correctly accounted for. Got more? Send 'em! 📸