4:30 1 Done Assignment2-HW_87692f... 2 Test your understanding 1 The following trial balance has been extracted from the books of Arran as at 31 March 20X7: $000 $000 Administration expenses 250 Distribution costs 295 Share capital $1 270 Share premium 80 Revaluation surplus 20 Dividend paid 27 Cash at bank and in hand 3 Receivables 233 Interest paid 25 Dividends received 15 Interest received 1 Land and buildings at cost (land 380, buildings 100) 480 Land and buildings: accumulated depreciation 30 Plant and machinery at cost 400 Plant and machinery: accumulated depreciation 170 Retained earnings account (at 1 April 20X6) 235 Purchases 1,260 Sales 2,165 Inventory at 1 April 20X6 140 Trade payables 27 Bank loan 100 3,113 3,113 Additional information 1 Inventory at 31 March 20X7 was valued at a cost of $95,000. Included in this balance were goods that had cost $15,000. These goods had become damaged during the year and it is considered that the goods could be sold for $5,500, less commission of $500. Depreciation for the year to 31 March 20X7 is to be charged against cost of sales as follows: Buildings 5% on cost (straight line) Plant and machinery 30% on carrying amount (reducing balance) Land is to be revalued upwards by $100,000. 3 4 Income tax of $165,000 is to be provided for the year to 31 March 20X7. 5 The bank loan is repayable in five years' time. Prepare the statement of profit or loss and other comprehensive income, statement of changes in equity and statement of financial position for year ended 31 March 20X7. Note: Show all workings, notes are not required.