Rose Limited operates a small chain of retail shops that sell high-quality teas and coffees. Approximately half
Question:
Rose Limited operates a small chain of retail shops that sell high-quality teas and coffees.
Approximately half of sales are on credit. Abbreviated and unaudited financial statements are as follows:
Since the unaudited financial statements for Rose Limited were prepared, the following information has become available:
1 An additional £74,000 of depreciation should have been charged on fixtures and fittings.
2 Invoices for credit sales on 31 March 2013 amounting to £34,000 have not been included;
cost of sales is not affected.
3 Trade receivables totalling £21,000 are recognised as having gone bad, but they have not yet been written off.
4 Inventories which had been purchased for £2,000 have been damaged and are unsaleable.
This is not reflected in the financial statements.
5 Fixtures and fittings to the value of £16,000 were delivered just before 31 March 2013, but these assets were not included in the financial statements and: the purchase invoice had not been processed.
6 Wages for Saturday-only staff, amounting to £1,000, have not been paid for the final Saturday of the year. This is not reflected in the financial statements.
7 Tax is payable at 30 per cent of profit before taxation. Assume that it is payable shortly after the year end.
Required:
Prepare revised financial statements for Rose Limited for the year ended 31 March 2013, incorporating the information in 1 to 7 above. (Work to the nearest £1,000.)
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