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Required: Write a report your response to Mr. Alfonso.  

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QUESTION 1 Mr. Alfonso, a client who has traded as a hardware merchant for the last five years, has told you that he finds difficulty in understanding the draft profit and loss account for the year ended 31 December 2000 which has been prepared by your assistant. Mr Alfonso's main concern is that, although the accounts show a profit, the bank overdraft at 31 December 2000 was significantly higher than it was a year earlier. Required: Write a report your response to Mr. Alfonso ANSWER 1 13 August 2001 Mr Alfonso Director Alfonso Hardware Trading No. 19 Enterprise Road Singapore 080019 Dear Mr Alfonso RE: EXPLANATION FOR THE DRAFT PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31 DECEMBER 2000 Upon hearing your concern and difficulty in understanding for the draft profit & loss account for the year 31 December 2000, I am please to attach the following information to assist you in understanding the draft. Firstly, as a director you must be...

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