The following figures have been extracted from the books of Bank of America. for the year ended 31.12.2020
Share capital authorized and issued
$.’000’
1,000,000 shares of $.100, $.50 paid
50,000
Reserve Fund
2,500
Fixed deposit account
9,500
Saving bank deposits
30,000
Current account
80,000
Money at call and short notice
3,000
Investment (cost
30,000
Interest accrued and paid
2,000
Salaries (including directors fee $.50,000)
800
Rent
200
General expenses including auditors fee $.20,000
100
Profit and loss (1.1.2017)
60,600
Dividend for 2,000
500
Premises (after depreciation to 1.12.000 $.10M)
120,000
Cash in hand
600
Cash with Federal reserves
15,000
Cash with other banks
13,000
Borrowed from other banks
7,000
Interest and discounts
11,500
Bills discounted and purchased
6,000
Bills payable
8,000
Loan overdraft and cash credits
70,000
Unclaimed dividends
300
Bills for collection
1,400
Acceptance and endorsements
2,000
Sundry creditors
300
Notes:
(i) Rebate on bills discounted and purchased for unexpired term amounts to $.50,000.
(ii) Depreciation on premises is on straight line, 5% on cost while the provision for
doubtful debts $.300,000 is required.
(iii) The bank has no business in outside America, a provision for taxation $.1,000,000 is to
be credited.
Required:
Prepare:
(a) Profit & Loss A/c for the year ended 31.12.2000
(b) Balance sheet as at that date. (Total 20 Marks)
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