The trial balance of Lytax at 31 December 20X2 is as follows: LO9

£ £

Capital at 1 January 20X2 68,000 Five-year loan 15,000 Land and buildings 67,000 Plant and machinery 38,000 Fixtures and fittings 21,300

£ £
Accumulated depreciation at 1 January 20X2 Land and buildings 12,000 Plant and machinery 8,100 Fixtures and fittings 5,300 Receivables 9,000 Bank 1,000 Payables 8,400 Discounts allowed 700 Purchases 79,500 Heat and light 1,300 Insurance 1,400 Wages and salaries 24,200 Inventory at 1 January 20X2 7,800 General expenses 1,200 Irrecoverable debts 700 Allowance for receivables 300 Drawings 25,000 Sales ______ 159,000 277,100 277,100 The following information needs to be taken into account before the financial statements can be finalised:
Inventory was valued at £8,000 at the close of business on 31 December 20X2 The owner took goods for his own use during the year. The cost of these was £1,500, and they have not been accounted for Interest on the loan at 8% p.a. has not been paid for the year ended 31 December 20X2 Wages and salaries owing at 31 December 20X2 amounted to £400 The figure for insurance includes a premium of £1,000 for the period 1 July 20X2 to 30 June 20X3 £450 of receivables are considered doubtful at 31 December 20X2 and an allowance against these is required The business’s depreciation policies are:
Buildings Straight-line over 50 years (Buildings element in the land and buildings cost is £40,000)
Plant and machinery 15% straight-line Fixtures and fittings 5% reducing balance.
Required:
Prepare Lytax’s statement of profit or loss for the year ended 31 December 20X2 and a statement of financial position at that date.