Alpha Plc
 Date: 31 December 2023

Trial Balance:

Description	Dr (£000)	Cr (£000)
Bank overdraft		150
Called-up share capital (ordinary shares of £1 each)		3,900
Accounts payable		180
Accounts receivable	160
Non-current assets: at cost	560
Accumulated depreciation (at 1 January 2023)		380
Marketing expenses	360
Office expenses	390
Retained profits (at 1 January 2023)		460
Production expenses	4,800
Purchases (net of VAT)	6,200
Sales (amounts invoiced, net of VAT)		12,400
Inventory (at 1 January 2023)	380
Trade accounts payable		410
Trade accounts receivable	4,900
Total	11,620	11,620

Additional Information:

1. Inventory at 31 December 2023 was valued at £430,000.
2. At 31 December 2023, £145,000 was owing for office expenses, and £135,000 had been paid in advance for marketing expenses.
3. A customer had gone into liquidation owing the company £550,000; the company does not expect to recover any of this debt.
4. The company decides to set up an allowance for doubtful debts amounting to 5% of the outstanding trade accounts receivable as at the end of each financial year.
5. Depreciation is to be charged on the non-current assets at a rate of 20% on cost; it is to be apportioned as follows:
   • Marketing: 25%
   • Office: 25%
   • Production: 50%

Note:
 There were no acquisitions or disposals of non-current assets during the year to 31 December 2023.

Required:
 Prepare Alpha Plc’s income statement for the year ending 31 December 2023, and a balance sheet as at that date.