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Here is the Statement of Comprehensive Income for CR Traders: Step 1: Calculate Adjusted Sales and Cost of Sales. Sales are adjusted for sales returns. Adjusted Sales = Sales (Trial Balance) - Sales Returns (Adjustment ii) Adjusted Sales = R340\,230 - R1\,200 = R339\,030 Cost of sales is adjusted for the cost of goods returned. Adjusted Cost of Sales = Cost of Sales (Trial Balance) - Cost of Sales for Returns (Adjustment ii) Adjusted Cost of Sales = R165\,200 - R800 = R164\,400 Step 2: Calculate Adjusted Other Income. • Rent income (Adjustment x): The rent increased by 10% on 1 May. Rent for July 2019 was received in advance. Let x be the monthly rent before May. Total rent received = (10 months × x) + (2 months × 1.1x) + (1 month × 1.1x) R99\,750 = 10x + 2.2x + 1.1x = 13.3x x = R99\,75013.3 = R7\,500 Rent income for the year (12 months) = 10 × R7\,500 + 2 × (R7\,500 × 1.10) = R75\,000 + R16\,500 = R91\,500. • Interest on fixed deposit: R6 000 (from Trial Balance). • Commission income: R28 593 (from Trial Balance). • Bad debts recovered (Adjustment viii): R1 720. Total Other Income = R91\,500 + R6\,000 + R28\,593 + R1\,720 = R127\,813 Step 3: Calculate Adjusted Operating Expenses. • Salaries (Adjustment v): R82 500 (TB) + R8 700 (June salaries) = R91 200. • Employers contribution (Adjustment v): R4 700 (TB) + R300 (June contribution) = R5 000. • Water and electricity (Adjustment i): R6 900 (TB) + R334 (accrued) = R7 234. • Telephone (Adjustment i): R3 420 (TB) + R478 (accrued) = R3 898. • Insurance (Adjustment iv): Expense for 10 months (Jul-Apr): 10 × R400 = R4\,000. Expense for 2 months (May-Jun): 2 × (R400 + R40) = 2 × R440 = R880. Total insurance expense for the year: R4\,000 + R880 = R4\,880. • Bad debts expense (Adjustment vii): Bad Debts (TB): R11 400. Bad debts written off (D. Danel): R1 300 - (R1\,300 × 0.30) = R1 300 - R390 = R910. Debtors allowance (TB, treated as expense): R6 600. Total bad debts expense: R11\,400 + R910 + R6\,600 = R18\,910. • Depreciation (Adjustment vi): Vehicles: (R484\,000 - R260\,000) × 15\% = R224\,000 × 15\% = R33\,600. Equipment: (R291\,000 - R5\,000) × 10\% + R5\,000 × 10\% × (6)/(12) = R28\,600 + R250 = R28\,850. Total depreciation: R33\,600 + R28\,850 = R62\,450. Total Operating Expenses = R91\,200 + R5\,000 + R7\,234 + R3\,898 + R4\,880 + R18\,910 + R62\,450 = R193\,572 Step 4: Calculate Adjusted Finance Costs. • Interest on loan (Adjustment ix): Loan amount: R30 000. Rate: 12%. Period: 10 months (1 Sept 2018 to 30 June 2019). Interest expense = R30\,000 × 12\% × (10)/(12) = R3\,000 • Interest on overdraft (Adjustment xi): R700. Total Finance Costs = R3\,000 + R700 = R3\,700 Step 5: Prepare the Statement of Comprehensive Income. |l|r| CR Traders & \\ Statement of Comprehensive Income & \\ for the year ended 30 June 2019 & \\ Sales & R339\,030 \\ Less: Cost of Sales & (R164\,400) \\ Gross Profit & R174\,630 \\ Other Income & \\ Rent income & R91\,500 \\ Interest on fixed deposit & R6\,000 \\ Commission income & R28\,593 \\ Bad debts recovered & R1\,720 \\ Total Other Income & R127\,813 \\ Operating Expenses & \\ Salaries & R91\,200 \\ Employers contribution & R5\,000 \\ Water and electricity & R7\,234 \\ Telephone & R3\,898 \\ Insurance & R4\,880 \\ Bad debts expense & R18\,910 \\ Depreciation & R62\,450 \\ Total Operating Expenses & (R193\,572) \\ Operating Profit & R108\,871 \\ Finance Costs & \\ Interest on loan & (R3\,000) \\ Interest on overdraft & (R700) \\ Total Finance Costs & (R3\,700) \\ Profit for the year & R105\,171 \\ What's next? 📸