Asset |
Cost ($) |
Useful life (years) |
|
Plant and equipment |
890 000 |
5 |
|
Buildings |
1 000 000 |
20 |
Year-end balances, 30 June 2019 |
$ |
Cash on hand |
20 |
Cash on deposit, at call |
25 |
Trade debtors |
950 |
Allowance for doubtful debts |
120 |
Other debtors |
50 |
Inventory |
985 |
Financial assets held for trading |
100 |
Land |
50 |
Buildings |
1000 |
Plant and equipment |
890 |
Patents |
55 |
Amortisation of patent |
2 |
Bank loans |
900 |
Other loans |
489 |
Trade creditors |
253 |
Provision for employee benefits |
95 |
Warranty provision |
30 |
Current tax payable |
95 |
Deferred tax liability |
25 |
Land revaluation reserve |
20 |
Required:
For the year ending 30 June, 2019 (NOTE: comparative financial statements are not required),
Prepare appropriate notes to the accounts. (You do not need to prepare notes related to income taxes. Include the following note as note 1. You may optionally add accounting policies to this note):
Statement of Comprehensive Income | ||
Revenue from operation | 4265 | |
Other income | 723 | |
Total(A) | 4988 | |
Expenses | ||
Cost of sale | 1800 | |
Distribution cost | Note - 1 | 595 |
Administration expense | Note - 2 | 740 |
Finance cost | Note - 3 | 180 |
Total(B) | 3315 | |
Profit before tax (A-B) | 1673 | |
Less:- TaxExpenses | 120 | |
Profit for the year | 1553 | |
Note - 1, Distribution expenses | ||
Selling and distribution expenses | 130 | |
Employee entitlement expenses | 95 | |
wages and salaries | 250 | |
Doubtful debts | 120 | |
Total | 595 | |
Note - 2, Administrative expenses | ||
Administration expense | 285 | |
Wages and salaries admin | 210 | |
Depreciation - Plant and Equipment | 178 | |
Depreciation - Building | 50 | |
Amortisation of patent | 2 | |
Provision for dividend | 15 | |
Total | 740 | |
Note - 3, Finance cost | ||
Interest expenses | 160 | |
Other borrowing expenses | 20 | |
Total (a) | 180 |
Statement of Other Comprehensive Income | ||||
Profit for the year | 1553 | |||
Revaluation of land transfer to reserve | Nil | |||
Total coprehensive income | 1553 | |||
Statement of changes in equity | ||||
Share Capital | Retained earning | General Reserve | Total | |
Balance as on 1st july 2018 | 200 | 200 | ||
Additional issue | 70 | 70 | ||
Profit for the year | 1553 | 1553 | ||
Dividend paid | -10 | -10 | ||
Transfer to General Reserve | -10 | 10 | 0 | |
270 | 1533 | 10 | 1813 | |
Statement of Financial Position | ||||
A) Assets | ||||
Non current asset | ||||
Land (50+20) | 70 | |||
Building (1000-50) | 950 | |||
Plant and equipment (890-178) | 712 | |||
Patent (55-2) | 53 | 1785 | ||
Current asset | ||||
Inventory | 985 | |||
Cash on hand | 20 | |||
Cash on deposit | 25 | |||
Trade debtors ( 950-120) | 830 | |||
Other debtors | 50 | |||
Financial asset held for trading | 100 | 2010 | ||
Total | 3795 | |||
B) Equity and Liability | ||||
Equity | ||||
Share capital | 270 | |||
Retained earnings | 1533 | |||
General reserve | 10 | 1813 | ||
Non current Liabilities | ||||
Bank loan | 900 | |||
Other loan | 489 | |||
Deferred tax liability | 25 | |||
Land revaluation reserve | 20 | 1434 | ||
Current Liabilities | ||||
Tradecreditors | 253 | |||
Provision for employee benefits | 95 | |||
Warranty Provision | 30 | |||
Provision for dividend | 15 | |||
Current tax payable | 95 | 488 | ||
Total | 3735 | |||
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