10.4 The following trial balance was extracted from the books of Porchester Ltd on 31 March 20X6:

£ £

Ordinary share capital (£1 shares) 500,000 Retained profit to 1 April 20X5 1,039,000 10% debentures repayable 20X9 300,000 Freehold land and buildings at cost 400,000 Plant and machinery at cost 1,300,000 Provision for depreciation on plant and machinery at 1 April 20X5 512,000 Debtors and prepayments (including trade debtors, £360,000) 370,080 Stock and work in progress at 31 March 20X6 984,020 Bank balance 268,000 Provision for doubtful debts at 31 March 20X6 15,000 Creditors and accrued expenses 351,500 Gross profit for the year 1,020,800 Administration expenses 216,900 Selling expenses 150,400 Bad debts written off 8,700 General repairs and maintenance 25,200 Debenture interest to 30 September 20X5 15,000 3,738,300 3,738,300 Additional information is provided as follows:
1 The company’s freehold property was revalued at £900,000 on 1 October 20X5. The directors have decided to use this figure for the purpose of the accounts.
2 The company made a bonus issue of two ordinary shares, fully paid, for each share held on 1 October 20X5. No entry has been made in the books in respect of the issue.
3 The directors propose to pay a dividend of 5 pence per share of the ordinary share capital at 31 March 20X6.
4 The company purchased additional plant costing £120,000 on 31 March 20X6. The plant was delivered to the company’s premises on that date together with the purchase invoice to be paid within seven days, but no entry has been made in the books in respect of the transaction.
5 Depreciation is to be provided at 25 per cent, reducing balance, on all plant and machinery owned by the company at the year end, except the plant referred to under 4 above. Ignore depreciaton of freehold property.
6 Corporation tax of £150,000, due for payment on 1 January 20X7, is to be provided out of the trading profit for the year.
7 The company’s authorized share capital is £2,000,000 divided into ordinary shares of £1 each.
The profit and loss account and profit and loss appropriation account of Porchester Ltd for the year ended 31 March 20X6, together with the balance sheet at that date. Particular attention should be given to layout, although the accounts need not necessarily be in a form appropriate for publication.