Straits Liners is a shipping company which at 1 January 2009 owned the following vessels:

• SS Invisible, bought for £450,000 on 1 July 2004

• SS Submersible, bought for £600,000 on 1 August 2005

• SS Outrageous, bought for £900,000 on 1 March 2006 All the ships are depreciated over five years on the straight line basis, assuming a residual value of 25% of cost price, with a full year's depreciation in the year of purchase but no depreciation in the year of sale. During the year ended 31 December 2009, the following events occurred:

• SS Invisible disappeared in the Bermuda Triangle and was considered lost.

• SS Submersible was part-exchanged for a new ship, SS Implausible, on 3 October. The cost of the new ship was £700,000. £200,000 was given in part exchange, with the balance paid by cheque.

• SS Outrageous was still owned at 31 December 2009. Show all the relevant entries in the income statement for the year ended 31 December 2009 and in the balance sheet as at that date. Show all workings.