(a) List and explain three problems encountered by accountants in accounting for agricultural activities. (3 marks)

(b) Given below is the trial balance of ADK Farm Ltd as at 31 December 2001:

	Sh.000	Sh.000
Ordinary share capital Share premium Land and buildings Farm machinery Sundry debtors Cash in hand Loan (crop) Retained profits Bank overdraft Accumulated depreciation Farm machinery Sundry creditors Stocks on 1 January 2001: Growing crops, wheat, seeds and fertilizers Livestock Farm labour Salaries and wages: Manager Farm labour Office expenses Crop expenses Livestock expenses Livestock purchases Purchase of feeding materials Farmhouse expenses Staff meals Repairs to machinery Interest on loan Tools and implements Sales of wheat Sales of livestock Managers account	4,500 2,200 580 320 180 280 105 120 110 280 210 250 670 120 25 10 30 40 120 _____	5,000 400 800 500 120 440 300 1,050 1,500 40
	10,150	10,150

The following additional information is provided:

1. On 31 December 2001, the value of stocks were as given below:

	Sh.000
Livestock Feeding materials Growing crops, wheat, seeds and fertilisers Tools and implements	240 130 20 100

2. Depreciation on tools and implements is apportioned equally between livestock and crop activities.

3. Farm machinery is depreciated at the rate of 5% per annum on cost.

4. Managers salary and staff meals should be divided between livestock and crop activities in the ratio 3:2 respectively.

Required:

(i) Livestock account for the year ended 31 December 2001. (5 marks)

(ii) Crop account for the year ended 31 December 2001. (5 marks)

(iii) Balance sheet as at 31 December 2001. (5 marks)