The following information has been taken from the accounts of Buttons Ltd, a retail business, for the year ended 30 September.

Required:

(a) Prepare a value added statement for Buttons Ltd for the year ended 30 September.

(b) State and comment upon the reasons why a business may present a value added statement to its shareholders in addition to a profit and loss account.

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3 Revenue 950,000 Cost of sales: Materials (220,000) Wages and salaries (160,000) Other expenses (95,000) Interest (45,000) Depreciation (80,000) (600,000) 350,000 Taxation Dividends paid Retained profit (110,000) 240,000 (120,000) 120,000