1. 1 Berwick plc Berwick plc has produced the following trial balance as at 31 January 2020. Profit before tax 490,000 Dividends paid 188,000 Development expenditure capitalised 70,000 Land and buildings Revalued 1,500,000 Plant and machinery Cost 650,000 Accumulated depreciation 160,000 Motor vehicles Cost 250,000 Accumulated depreciation 90,000 Inventories and work in progress 370,000 Trade receivables and trade payables 420,000 410,000 Lease instalments and costs paid 85,000 Prepayments and accruals 12,000 100,000 Bank balance in hand and overdrawn 49,000 110,000 Ordinary share capital ordinary shares of 1 each 850,000 Retained earnings 770,000 Revaluation surplus 564,000 Share premium account 50,000 3,594,000 3,594,000 Additional information: (1) The company's land and buildings were revalued on 1 February 2019 at 1.5 million (land element 300,000). The remaining useful life of the buildings at that date was estimated at 40 years. The property originally cost 1 million on 1 February 2015 (land element 200,000) and was being depreciated over 50 years. (2) No adjustments have been made for the depreciation charges for the year ended 31 January 2020. Depreciation rates are as follows. Land and buildings see (1) above Plant and machinery 10% straight line Motor vehicles 20% reducing balance (3) On 1 February 2019, Berwick acquired an item of plant under a lease agreement that had an implicit finance cost of 10% per annum. They incurred initial direct costs of 5,000 in respect of the negotiation of the lease. The lease required an initial deposit of 20,000 paid on 1 February 2019 and the first annual rental of 60,000 paid on 31 January 2020. The lease agreement requires further annual payments of 60,000 on 31 January each year for the next four years and a final additional payment of 4,113 on 31 January 2024. The present value of the lease payments amounted to 250,000. The useful life of the plant is 5 years. The instalments paid and the direct costs incurred have been recorded in the trial balance. No other accounting entries have been made in respect of the lease. (4) Tax on profits for the year has been estimated at 135,000 and has yet to be provided for in the trial balance. (5) The development expenditure was incurred during the year and relates to a single product. Development will be completed in 2021. The company believes it has a reasonable expectation of future benefits but has been unable to demonstrate this. (6) One of Berwick plc's customers who owed 16,000 at 31 January 2020 went into liquidation on 2 February 2020. The liquidator has told creditors that they can expect to receive 30p in the . (7) On 31 December 2019 Berwick plc made a 1 for 5 rights issue at 1.25. The issue was fully subscribed. The full amount received was debited to cash and credited to retained earnings, as the bookkeeper was not sure how to post it. Requirement Prepare the statement of financial position of Berwick plc as at 31 January 2020 and the statement of changes in equity for the year ended 31 January 2020 in a form suitable for publication to the extent the information is available. Total 25 Marks