Alokozay PLC is facing problems in the adjustment of Irregular items of Income Statement and Retained earnings statement. Because such adjustments need special knowledge of International Accounting Standards so they have hired your accounting firm for helping them to prepare financial statements.

You have been handed over the following information,

Selling Expense

Write-Off of Account Receivable Gain on sale of Trading Securities Retained Earnings beginning balance Dividend Declared and Paid

Cost of Goods Sold

$200,000 80,000 $110,000 $760,000 $30,000 $800,000

Admin Expenses Income Tax Interest Earned Sales (Gross) Sales Return Sales Discount

$100,000 20%

145,000 $ $2,300,000 $20,000 $34,000

Depreciation Expense (current year) $24,000 Advertisement Expense 60,000

Rent Expense Interest Expense

$40,000 $61,000

$465,000 $120,000 $230,000 $25,000 $600,000 $38,000 $78,000

Loss due to Hail Storm - Extraordinary Item (Pre Tax)

Loss from Discontinuation of a business unit (Pre Tax)

Loss from the operations of Discontinued business unit (Pre Tax)

Under statement of Depreciation Expense related to previous year (Pre Tax) Gain from Extraordinary Item (Pre Tax) Gaintochangeininventorymethod (PreTax)

Write-Off of inventory due to expiration

Requirement: Assuming current year as 2019, How to prepare the followings:

Income Statement

Retained Earnings statement