Balance Sheet Preparation

1. Authorized share capital of the company is 100 000 ordinary shares of $ 1 each, of which 75,000 were issued and fully paid at $ 1.15 per share.

2. All fixed assets were bought on 1 June 2002,the date the company was incorporated.
Depreciation is applied as follows.

(i) Motor vehicles– 40 % reducing balance.
(ii) Equipment– 20 % straight line,after taking into account a 10 % residual balance.

3. A dividend of $ 0.12 per share has been proposed for the year ended 31 May 2005.

4. A provision for doubtful debts of 5% of debtors at 31 May 2005 is to be created.

5. Stock costing $ 2500 had been sent to a customer on a sale or return basis on 25
May 2005.It had been neither returned nor sold by the year end and no entries regarding it had been made in the accounts.

Required:
(a) James De first Ltd’s balance sheet as at 31 May 2005 in vertical format.