1 The following trial balance has been extracted from the books and records of Palestine Plc on 31 December 2021 Buildings at cost 350,000 Delivery vehicles at cost 50,000 Accumulated depreciation on delivery vehicles b/f 18,000 Fixtures and fittings at cost 114,000 Accumulated depreciation on fixtures and fittings b/f 57,000 Trade Receivables/Payables 52,200 88,640 General expenses 78,900 Inventory at 1 January 2021 87,000 Cash and cash equivalents 114,210 Retained earnings at 1 January 2021 46,850 Purchases of inventory 490,650 Wages and salaries 132,510 Revenue 945,810 Ordinary shares at 0.50 each 300,000 8% Long term borrowing 143,700 Rent 74,000 Travel expenses 56,530 Additional information The corporation tax rate is 19%. Company has not accounted any interest for the year in relation to the 8% Loan. The year-end inventory is valued at 114,500. This includes one product line with a cost of 8,000 that has not been selling well. Prices indicate that the expected selling price of the products of this line is 5,000 and the company will need to spend 500 in distributing those products. Vehicles must be depreciated on a reducing balance basis, 10% rate. Fixture and fittings must be depreciated on a straight-line basis, 20% rate. On 1 June 2021, the company issued 100,000 shares at a price of 1.10 per share. This transaction has not been recorded. A final dividend payment of 5 pence per share was agreed and approved, but not paid, at 31 December 2021. Question 1 continues on the next page... Question 1 (continued) Required: Using International Accounting Standards (IAS) produce the following financial statements: (a) The statement of profit or loss for the year ended 31 December 2021. (b) The statement of changes in equity for the year ended 31 December 2021. (c) The statement of financial position as at 31 December 2021. Note: Show all your workings as notes to the accounts. Round up any decimal. E.g. 10,223.60 to 10,224. [TOTAL 45 MARKS]