1 The following trial balance relates to Ken and Ken Limited, a wholesale company as at 31st December 2017. Ordinary shares (29,000 shares) 8% Loan notes (2012-2020) (note (v)) 10% Debenture Revaluation reserve Contingency reserve Sales revenue iii) iv) v) Debit Credit GH GHE 116,000 20,000 24,000 1,400 12,000 Income Surplus - 1/1/2017 28,800 550,920 Inventory 1/12/2017 55,200 VAT/NHIL 2.400 Purchases 124,000 Loan Note interest paid (note (v)) 880 Investment income 2,880 Administration expenses (note (iv)) 68.320 Selling & distribution expenses 44,800 Trade receivables 74,280 cash and cash equivalents 112,720 Trade payables 32,000 Corporation tax (12,400 *Deferred tax 1/1/2017 18,400 Leasehold building at valuation-1/1/2017 112.000 Plant and equipment-cost/depreciation 110,000 25.600 vii) Computer equipment-cost/depreciation 57,600 16,000 Motor vehicles - cost/depreciation Investment property (note (i)) Suspense 12,000 3.200 69,600 5,000 856,200 856,200 The following additional information is relevant: i) ii) The closing inventories at 31st December, 2017 were valued at a cost of GH37,500. Due to some slow moving products the estimated net realizable value was GH29,500. The sales and the purchases figures in the trial balance included output VAT/NHIL and input VAT/NHIL respectively at the standard rate of 3%. The VAT/NHIL figure on the trial balance represents the total net payment made to Ghana Revenue Authority during the year. The balance on the corporation tax account represents an under provision of tax for the previous year. Corporate Tax for the current year is estimated at GH25,000. In addition, the deferred tax provision on the trial balance is to be adjusted to GH20,400 in line with movement in the temporary timing differences. The company decided to change its accounting policy with respect to its investment property from "cost model" to "fair value model" as per IAS 40 Investment property. On 31 December 2017 a qualified surveyor valued the investment property at GH 79,000. This decision is yet to be accounted for in the books of the company. Non-current assets: Depreciation of Property, plant and equipment is to be provided on the following bases: Plant and equipment Computer equipment Motor vehicles 10% on cost 25% on cost 20% on reducing balance No depreciation has yet been charged on any non-current asset for the year ended 31" December, 2017. Ken and Ken Limited revalues its buildings at the end of each accounting year. At 31st December, 2017 the relevant value to be incorporated into the financial statements is GH117,600. The building's remaining life at the beginning of the current year (1 January, 2017) was 25 years. Ken and Ken does not make an annual transfer from the revaluation reserve to retained earnings in respect of the realisation of the revaluation surplus. Ignore deferred tax on the revaluation surplus. vi) The company paid ordinary dividends of GH0.45 per share 15th December, 2017. The dividend payments are included in administrative expenses in the trial balance. The balance on the suspense account represents the proceeds from the issue of 1,000 ordinary shares issued at GH5each. Required: Prepare the following financial statements of Invincible Ltd for publication in accordance with International Financial Reporting Standards (IFRS): a) Statement of Profit or Loss and other Comprehensive income for the year ended 31" December, 2017; b) Statement of Changes in Equity for the year ended 31 December, 2017; and c) Statement of Financial Position as at 31" December, 2017. Show clearly all relevant workings Note: Accounting policy notes are not required 2 23 (20 marks) 2