3.7 Madigan & Co is the trading name of Basil Madigan, a chartered accountant. He runs a small city-centre office, employing a part-qualified accountant as an assistant, and a part-time secretary.

In the year ended 31 March 20X8 fees from Madigan’s clients totalled £95,311. The assistant’s salary was

£19,300 and the secretary was paid £11,150. Basil’s one-room office is in a run-down office building at a comparatively low rental of £10,310 which includes energy costs and business rates. There is also an annual service charge (to cover repairs, caretaking, and so on) which amounted to £3,790 in the year ended 31 March 20X8.

Basil paid general insurance of £794, plus PII of £1,250. Subscriptions and professional registration charges were £952. Business travel expenses (mileage claims for use of own car by himself and his assistant)

came to £1,863. Entertainment was £342.

Telephone and broadband charges were £1,103 for the year and other administration charges were

£1,575. Stationery was £761 and sundry expenses totaled £715. Basil made donations to local charities out of the business account to the sum of £120.

Prepare the statement of profit or loss for Madigan & Co for the year ended 31 March 20X8.