The following balances have been extracted from the books of Jim Ltd as at 31 March 2020:

Additional information
1. Inventory at 31 March 2020 was valued at £14,000.
2. Furniture and fittings and vehicles are depreciated at a rate of 15 percent and 25 percent, respectively, on cost.
3. Corporation tax owing at 31 March 2020 is estimated to be £25,000.
4. A dividend of 40p per share is proposed.
5. The company’s authorised share capital is £100,000 of £1 ordinary shares.

Required
1. Prepare Jim Ltd’s trading and statement of profit or loss and statement of retained earnings for the year to 31 March 2020 and a statement of financial position as at that date.
2. Why would the business not necessarily be worth its net assets value as at 31 March 2020?

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Advertising Cash Payables Receivables Furniture and fittings: At cost Accumulated depreciation (at 1.4.20) Directors' fees Retained earnings (at 1.4.20) Purchases Rent and rates Sales Share capital (issued and fully paid) Inventory (at 1.4.20) Telephone and stationery Travelling expenses Vehicles: At cost Accumulated depreciation (at 1.4.20) Wages and salaries Dr £ 3000 11000 118000 20000 6000 124000 10000 16000 5000 2000 40000 24000 379000 Cr £ 12000 9000 8000 270000 70000 10000 379000