Additional information

1. Inventories as at 31 December 2021 had a cost of 33,400 However, shortly after the year end these items included in this figure that were now considered out of date at a cost of 10,000 were sold for 8,000 and incurred additional selling costs of 1,000.

2. On 1 June 2021, Riverbank made a 1 for 4 Bonus issue (using the share premium account), this has correctly been accounted for in the figures above

3. A dividend of 80p per ordinary share was paid on 1 March 2021 on the correct number of shares in issue at that date. This was incorrectly debited to distribution costs.

4. Riverbank Ltd charges depreciation is yet to be charged and is as follows: Buildings straight line over 40 years charged to admin expenses Plant and Machinery 25% per annum reducing balance charged to cost of sales.5. On 31 December 2021 Directors made the decision to revalue Land and Buildings to its market rate of 600,000, this is yet to be accounted for in the trial balance.

5. On 31 December 2021 Directors made the decision to revalue Land and Buildings to its market rate of 600,000, this is yet to be accounted for in the trial balance.

6. After consultation with solicitors the legal provision is to be decreased by 40% at 31 December 2021, any change in provision is to be taken to admin expenses.

7. The acquired brand name had previously been assumed to have an infinite life. At 31 December directors has assessed its value in use terms of future cash flows is 200,000, and has an estimated market value if sold to a competitor of 180,000, any impairment is taken to cost of sales.

8. The final quarter of interest on the debenture has not been accounted for, the debenture is due to be settled on 31 December 2026.

9. The income tax charge for the year has been estimated as 75,000.

Requirement

Prepare a statement of profit or loss and other comprehensive income, and a statement of changes in equity for Riverbank Ltd for the year ended 31 December 2021 and a statement of financial position as at 31 December 2021, in a form suitable for publication.

Notes to the financial statements are not required, expenses should be presented analysed by function and ignore the tax effects of any adjustments.

Riverbank Ltd has prepared the following trial balance at 31 December 2021 before taking account of the additional information below Debit Credit Ordinary share capital (1 nominal value) 100,000 Share premium account 20,000 Retained earnings at 1 January 2021 110,000 Revenue 756,034 Inventories at 1 January 2021 32,000 Purchases 233,332 Administrative expenses 138,228 Finance expenses 12,000 Distribution costs 75,934 Land and Buildings - Cost (200,000 of which relates to 400,000 land) Land and Buildings Accumulated Depreciation at 1 40,000 January 2021 Plant and Machinery - Cost 68,000 Plant and Machinery - Accumulated Depreciation at 1 23,800 January 2021 Trade receivables 112,992 Trade payables 80,764 Cash at bank 33,112 Acquired Brand name 235,000 8% Debenture (repayable 2026) 200,000 Legal Provision 10,000 1,340,598 1,340,598