1.6 FINANCIAL STATEMENTS FLY HIGH LIMITED 1.6 Show the amounts for the transactions below in the appropriate columns for the Statement of Comprehensive Income and Stement of Financial Position and the end of the financial year eneded 28 February 2025. (11) Example: (i) Insurance paid for the year, R35 000. (ii) Petty cash at the end of the year, R300 TRANSACTIONS ON 28 FEBRUARY 2025: 1.6.1 Commission income for the year received amounted to R89 000. 1.6.2 Audit fees paid amounted to R72 000. Only \( 80 \% \) was paid during the financial year. 1.6.3 The loan from BB Bank on 28 February 2025 amounted to R960 000. \( 20 \% \) of the amount will be paid back in the next financial year. 1.6.4 Rent income amounted to R202 500. On 1 November 2024 the rent increase with \( 10 \% \). The rent for March 2025 was also received. 1.6.5 Provision for bad debts amounted to R17 800. The provision must be decreased with R800.

To record the transactions for FLY HIGH LIMITED in the Statement of Comprehensive Income and the Statement of Financial Position for the year ended 28 February 2025, we will analyze each transaction step by step. ### Known Conditions: - Financial year ended: 28 February 2025 - Transactions to be recorded include income, expenses, assets, and liabilities. ### Transactions Analysis: 1. **Commission income for the year received amounted to R89,000.** - **Statement of Comprehensive Income:** This will be recorded as income. - **Amount:** R89,000 2. **Audit fees paid amounted to R72,000. Only 80% was paid during the financial year.** - **Statement of Comprehensive Income:** This will be recorded as an expense. - **Amount paid during the year:** \( 0.8 \times 72,000 = R57,600 \) - **Amount payable (liability):** \( 0.2 \times 72,000 = R14,400 \) 3. **The loan from BB Bank on 28 February 2025 amounted to R960,000. 20% of the amount will be paid back in the next financial year.** - **Statement of Financial Position:** This will be recorded as a liability. - **Current liability (to be paid next year):** \( 0.2 \times 960,000 = R192,000 \) - **Non-current liability:** \( 0.8 \times 960,000 = R768,000 \) 4. **Rent income amounted to R202,500. On 1 November 2024, the rent increased by 10%. The rent for March 2025 was also received.** - **Statement of Comprehensive Income:** This will be recorded as income. - **Amount:** R202,500 5. **Provision for bad debts amounted to R17,800. The provision must be decreased by R800.** - **Statement of Comprehensive Income:** This will be recorded as an expense (decrease in provision). - **New provision amount:** \( 17,800 - 800 = R17,000 \) ### Summary of Entries: #### Statement of Comprehensive Income: - **Commission Income:** R89,000 - **Audit Fees Expense:** R57,600 - **Rent Income:** R202,500 - **Decrease in Provision for Bad Debts:** R800 (as an expense) #### Statement of Financial Position: - **Audit Fees Payable:** R14,400 - **Loan from BB Bank (Current Liability):** R192,000 - **Loan from BB Bank (Non-current Liability):** R768,000 - **Provision for Bad Debts:** R17,000 ### Final Amounts: #### Statement of Comprehensive Income: - Total Income: \( 89,000 + 202,500 = R291,500 \) - Total Expenses: \( 57,600 + 800 = R58,400 \) #### Statement of Financial Position: - Current Liabilities: \( 14,400 + 192,000 = R206,400 \) - Non-current Liabilities: \( 768,000 \) - Provision for Bad Debts: \( R17,000 \) Now, let's summarize the amounts in the appropriate columns for both statements. ### Final Summary: #### Statement of Comprehensive Income: | Description | Amount (R) | |---------------------------------|------------| | Commission Income | 89,000 | | Rent Income | 202,500 | | Audit Fees Expense | (57,600) | | Decrease in Provision for Bad Debts | (800) | | **Total Income/Expenses** | **291,500 - 58,400 = 233,100** | #### Statement of Financial Position: | Description | Amount (R) | |---------------------------------|------------| | Audit Fees Payable | 14,400 | | Loan from BB Bank (Current) | 192,000 | | Loan from BB Bank (Non-current) | 768,000 | | Provision for Bad Debts | 17,000 | | **Total Liabilities** | **14,400 + 192,000 + 768,000 + 17,000 = 991,400** | This concludes the analysis and recording of the transactions for FLY HIGH LIMITED for the financial year ended 28 February 2025.