(A) prepare the statement of financial position, the income statement, and the statement of changes in equity for the year ended 31 December 2021 for the directors.

(B) explains the difference between capital and reserve, provide example to reinforce your discussion.

16. The following information is the preliminary trial balance of Griffin Ltd for year ending of 31st of December 2021: Debits (E) Credits (E) Sales Revenue 259,450,000 Property 55,237,500 Building Machinery - Historic Cost 28,125,000 Building Machinery - Accumulated Depreciation 5,625,000 Inventories (at the 1st of January 2021) 20,250,000 Purchases 90,000,000 Lease Liabilities (due in more than one year) 7,312,500 Land 13,500,000 Staff Wages 47,250,000 Accrued Staff Wages 2,250,000 Office Equipment - Historic Cost 18,562,500 Office Equipment - Accumulated Depreciation 11,250,000 Bank Interest Expense 4,500,000 Construction Vehicles - Historic Cost 11,250,000 Construction Vehicles - Accumulated Depreciation 2,250,000 Trade Receivable 31,725,000 Intangible assets (e.g patents, trademarks) 49,500,000 Trade Payable 4,500,000 Bank Loan 45,000,000 Share Premium 33,750,000 Rental Income (from non-core operations) 7,875,000 Asset Revaluation 2,250,000 Lease Expense (on retail shops) 3,937,500 Lease Liabilities (due in less than one year) 1,350,000 Share Capital (150) 56,250,000 Retained Earnings 50,625,000 Administrative Expense 53,325,000 You are given the following information: i. Closing inventories was 24,000,000 on the 31st of December 2021. ii. Corporation tax is 25% for the year, half due now and should be paid in cash and half due in April 2022. iii. Unpaid invoices for carriage inwards for 80,000 were found at the year-end. iv. 10,000,000 of purchased patents included in Intangible Assets need to be written off, as the technology they represented has become obsolete. V. On 20 January 2022 the company has received an electricity bill for the period November December 2021 for an amount of 100,000. vi. Depreciation (all based on reducing balance): a) Office Equipment -25% b) Building Machinery - 20% c) Construction Vehicles - 12% -- vii. 8,000,000 of the trade receivable figure is considered unrecoverable and should be written-off as bad debts. viii. Dividends were distributed to shareholders during the financial year to a value of 5,000,000 in cash. ix. A 1 for 3 bonus issue was given to shareholders. The bonus issue should be made using a revenue reserve. 16. The following information is the preliminary trial balance of Griffin Ltd for year ending of 31st of December 2021: Debits (E) Credits (E) Sales Revenue 259,450,000 Property 55,237,500 Building Machinery - Historic Cost 28,125,000 Building Machinery - Accumulated Depreciation 5,625,000 Inventories (at the 1st of January 2021) 20,250,000 Purchases 90,000,000 Lease Liabilities (due in more than one year) 7,312,500 Land 13,500,000 Staff Wages 47,250,000 Accrued Staff Wages 2,250,000 Office Equipment - Historic Cost 18,562,500 Office Equipment - Accumulated Depreciation 11,250,000 Bank Interest Expense 4,500,000 Construction Vehicles - Historic Cost 11,250,000 Construction Vehicles - Accumulated Depreciation 2,250,000 Trade Receivable 31,725,000 Intangible assets (e.g patents, trademarks) 49,500,000 Trade Payable 4,500,000 Bank Loan 45,000,000 Share Premium 33,750,000 Rental Income (from non-core operations) 7,875,000 Asset Revaluation 2,250,000 Lease Expense (on retail shops) 3,937,500 Lease Liabilities (due in less than one year) 1,350,000 Share Capital (150) 56,250,000 Retained Earnings 50,625,000 Administrative Expense 53,325,000 You are given the following information: i. Closing inventories was 24,000,000 on the 31st of December 2021. ii. Corporation tax is 25% for the year, half due now and should be paid in cash and half due in April 2022. iii. Unpaid invoices for carriage inwards for 80,000 were found at the year-end. iv. 10,000,000 of purchased patents included in Intangible Assets need to be written off, as the technology they represented has become obsolete. V. On 20 January 2022 the company has received an electricity bill for the period November December 2021 for an amount of 100,000. vi. Depreciation (all based on reducing balance): a) Office Equipment -25% b) Building Machinery - 20% c) Construction Vehicles - 12% -- vii. 8,000,000 of the trade receivable figure is considered unrecoverable and should be written-off as bad debts. viii. Dividends were distributed to shareholders during the financial year to a value of 5,000,000 in cash. ix. A 1 for 3 bonus issue was given to shareholders. The bonus issue should be made using a revenue reserve