Case 1. (Learning Objectives 3, 4, 5: Preparing financial statements) You are the accountant of Majestic Limited, headquartered in Zurich, Switzerland, and have just completed the accounting cycle for the period ended December 31, 20X5. You have performed all necessary adjustments and closing entries to the accounts. The adjusted trial balance (after allocation to function expense categories) is shown as follows, along with comparative figures from the last financial year.

Requirement Prepare the statement of financial position, statement of comprehensive income, and statement of changes in equity in good form, with any relevant accompanying notes to the financial statements.
Before aggregating line items, you should consider the key principles outlined in IAS 1.

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A1 1 (in CHF) Dec 31, 20X5 Dec 31, 20X4 2 Account balances Debits Credits Debits Credits 3 Cash on hand 68,900 51,200 4 Bank account balances 76,000 55,000 5 Prepaid insurance 25,800 24,300 8 6 Prepaid subscriptions 7 Prepaid rent Trade receivables 9 Advances to employees 10 Interest receivable 11 Other receivables 3,500 2,300 10,200 24,300 80,300 47,000 43,600 49,400 26,100 25,300 46,000 60,300 12 Inventory 50,300 47,000 13 Vehicles and trucks 60,000 60,000 14 Acc Depn-Vehicles and trucks 35,000 30,000 15 Furniture and fixtures 43,000 43,000 16 Acc Depn-Furniture and fixtures 13,500 12,000 17 Office equipment 47,000 47,000 18 Acc Depn-Office equipment 16,000 14,000 19 Store equipment 36,000 36,000 20 Acc Depn-Store equipment 15,000 12,000 21 Trade payables 22 Dues to employees 23 Unearned revenue 24 Deferred income 25 Accrued liabilities 39,900 34,900 27,200 17,700 22,900 29,100 25,000 24,000 8,300 13,600 26 Bank loan (due 20X8) 120,000 120,000 27 Notes payable (due 20X6) 40,000 40,000 28 Share capital 169,500 150,000 29 Retained earnings (beginning) 74,800 87,400 30 Dividends paid 80,000 45,000 31 Sales revenue 166,700 151,100 32 Commission revenue 32,900 26,500 33 Dividend income 49,300 53,800 34 Cost of sales 41,600 39,800 35 Logistics and distribution expenses 26,900 34,200 36 Sales and marketing expenses 16,300 35,700 37 Finance expenses 21,700 22,200 38 Other administrative expenses 29,100 46,300 39 Tax expense 23,700 20,800 40 856,000 856,000 816,100 816,100 41