Trial balances for Rocky Products at the beginning and end ofthe 1983 accounting year are as follows:

January 1 December 31

£000 £000 Land 120 120 Buildings (net) 60 58 Equipment (net) 45 48 Stock of goods 71 76 Trade debtors 40 45 Prepaid expenses II 10 Cash 10 20 -- - -

357 377 Capital introduced 140 140 Retained earnings 54 66 Long-term loan 60 75 Trade creditors 82 79 Interest payable 2 3 Accrued expenses 19 14 - - --

357 377 An analysis of the cash account for 1983 revealed the following:
Receipts:
For cash sales Collections from trade debtors Increase in long-term loan Payments:
To trade creditors For operating expenses Interest on loan Purchase of equipment £000 45 286 IS 346 186 109 17 24 336

(a) Reconstruct the relevant ledger accounts for Rocky Products for 1983.

(b) Prepare an Income Statement for Rocky Products for the year ended 31 December 1983, and a classified Balance Sheet at that date .