accounting

Question A1.docx Question A1: Thls question has two parts, answer both. (40 marks) Alpha pic prepares nancial statements to 31 December each year. The company's trial balance at 31 December 2019 is as follows: 2 E Land at cost 500,000 Buildings at cost 600,000 Accumulated depreciation: buildings at 1 120.000 January 20' 9 Machinery and equipment at cost 394,800 Accumulated deprau'ation: machinery and 211,500 equipment at 1 January 2019 Inventory at 1 January 2019 175.040 Trade receivables and payables 143,000 242,580 Provision for doubtful debts at 1 January 2019 3,040 Bank 20, 780 9% debenture (repayable in 5 years) 240,000 Purchases and sales 941,3201.996,620 Director's lee: 116.800 Wages and salaries 204,500 General administrabve costs 286,880 Geneiii distribution costs 214,100 Interest paid 12.440 Dividends paid 70,000 Ordinary shares 0121 par value 160,000 Share premium 150,000 Retained earnings at 1 January 2019 514,660 3,659,160 3.659,180 The following information is also available: 0 The buildings were acquired on 1 January 2011 and are depreciated using straight-line method over its useful life of 40 years. Machinery and equipment are depreciated at 25 percent per annum on the reducing balance basis. There is no residual value for building. machinery and equipment. - Alpha plc revalued the land at 31 December 2019 at 560,000. ' Depreciation of buildings should be split 70:30 between administrative and distribution costs. Depreciation of machinery and equipment should be split 20:80 between administrative and distribution costs. - The cost of inventory at 31 December 2019 is 196,560, including goods with an original cost of 62,000 which have a net realisable value of 50,000. ~ Trade receivables include bad debts of 4,000 which should be written off. The provision for doubtful debts is provided at 2 percent of the trade receivables. Bad debts expenses are to be treated as administrative costs. - The 9% debenture was issued on 1 July 2019. Interest is payable halfyearly on 30 June and 31 December. The interest 01 the debenture for the year ended 31 December 2019 has not yet been accounted for. - Director's fees are to be treated as administrative costs. Wages and salaries should be split equally between administrative and distribution costs. - Cash dividends of 80,000 was declared on 1 October 2019. No entries have yet been made in relation to this issue. - The taxation for the year is estimated to be 40,000. due on 1 April 2020. REQUIRED: Parti Prepare both the statement of comprehensive income for the year ended 31 December 2019 and the statement of financial position at 31 December 2019 for Alpha pic, in accordance with International Financial Reporting Standards