ABC Ltd extracted its year-end Trial Balance as shown below. You are further informed:

(a) A vehicle acquired for £14,000 and written down to £6,000 by 31.3.2010 was sold on that day for £5,000. The disposal has not been accounted for other than posting the proceeds to a Suspense account.

(b) Administrative expenses include £4,000, the amount by which tax paid on previous year’s profit exceeded the amount provided for.

(c) Cost of year-end inventory was £124,875.

(d) As at the year-end adjustments need to be made as follows:

(e) Depreciation should be provided for as:

Buildings at 4% p.a. on cost

Plant and equipment at 20% p.a. on cost

Vehicles at 25% p.a. – reducing balance method.

(f) Tax on the profit earned in the year ended 31 March 2011 is estimated at £15,000.

Required: 

Prepare for internal use the Statement of income for the year ended 31 March 2011, together with the Statement of changes in equity and the Statement of financial position as at 31.3.2011.

Transcribed Image Text:

Trial Balance as at 31.3.2011 Freehold land at cost Buildings at cost Plant and equipment at cost Motor vehicles at cost Accumulated depreciation: Buildings Plant and equipment Motor vehicles Inventory 1 April 2010 Receivables/payables Cash at bank Sales (all on credit) Purchases (all on credit) Returns inwards/outwards Discount allowed/received Admin. expenses Selling/distribution expenses Ordinary shares of £1 each Retained earnings Suspense account £ 60,000 50,000 120,000 32,000 74,000 122,500 3,500 134,630 12,900 3,200 22,150 6,900 - 641,780 4 |||| 20,000 74,000 16,800 - 99,800 249,760 - 4,875 1,850 100,000 69,695 5,000 641,780