The following trial balance has been extracted at 30 November 2009 from the nominal ledger of Showroad Antiques Ltd. The company is owned and run by Fiona Scully, who asks you to help her prepare the final accounts for 2009.

Additional information:

(a) Inventory at 30 November 2009 was counted and valued at cost totalling £77,000. However, included in this figure are two items that Fiona is unsure about:

® A guitar that was once played by a very famous rock star is included at cost price of £2,200. However, the star’s public image has just been ruined by a high-profile, unsavoury scandal. The guitar will probably now only fetch about £500 when it is sold.
@ Atennis racket used by the great Fred Perry at Wimbledon is included at cost price £3,100. However, it will have to be repaired at a cost of £500 before it can be sold for £4,000.

(b) During December, Fiona learnt that a credit customer had gone into liquidation.
The customer owed £16,000 to the company as at 30 November 2009, which is included in the trade receivables figure in the above trial balance.
Additionally, the provision for bad debts is to be adjusted to 10 per cent of trade receivables based on past experience.

(c) The bank loan does not become repayable until 2012.
You are required to prepare the income statement for Showroad Antiques Ltd for the year ended 30 November 2009 and the statement of financial position as at that date.

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Dr Cr Bank interest paid Bank loan Insurance Cash at bank 2,000 20,000 5,000 2,000 Fixtures and fittings at cost 11,000 Inventory as at 1 December 2008 88,000 Motor vehicles at cost 30,000 Provision for bad debts as at 1 December 2008 3,000 Purchases 380,000 Rent and rates 14,000 Retained earnings as at 1 December 2008 37,000 Sales 699,000 Share capital 28,000 Telephone 7,000 Trade payables 27,000 Trade receivables 66,000 Travel expenses 68,000 Wages and salaries 141,000 814,000 84,000