Lime’s business has had liquidity problems for some months. The following trial balance was…

Lime’s business has had liquidity problems for some months. The following trial balance was extracted from his books of account as at 30 September 2012: Additional information: 1. Stock at 30 September 2012: £68 000. 2. At 30 September 2012, accrual for rates of £2000 and insurance prepaid of £200. 3. Depreciation on office equipment is charged at a rate of 25 per cent on cost. During the year, office equipment costing £4000 had been sold for £500. Accumulated depreciation on this equipment amounted to £3000. Lime’s depreciation policy is to charge a full year’s depreciation in the year of acquisition and none in the year of disposal. 4. Specific bad debts of £13 000 are to be written off. 5. The provision for bad and doubtful debts is to be made equal to 10 per cent of outstanding trade debtors as at 30 September 2012. Required: Prepare Lime’s trading, and profit and loss account for the year to 30 September 2012, and a balance sheet as at thatdate.