Alphabet Ltd is a large stationery retailer listed on the JSE Securities Exchange. The company hasa $30$ June reporting period and it and all of its suppliers and$/$or customers are registered VAT vendorsat a rate of $15\%.$The following trial balance for the year ended $30$ June $20$x$20$ is presented to you:ALPHABET LTDTRIAL BALANCE FOR THE YEAR ENDING $30$ JUNE $20$x$20$Note Debit CreditR RShare capital $(1$ January $20$x$20)210700000$Retained earnings $(1$ July $20$x$19)1230500$Ordinary application and allotment account $21750000$Land and buildings $59980000$Vehicles $71225500$Plant and equipment $61400500$Accumulated depreciation: Vehicles $(1$ July $20$x$19)7165769$Accumulated depreciation: Plant and equipment $(1$ July $20$x$19)685000$Other financial investments $81275625$Inventories $(30$ June $20$x$20)152577650$Accounts receivable $151410000$Bank $980620$Mortgage bond: Finrite Financers $(7,5\%)515000008\%$ Secured Debentures $4350000$Accounts payable $454130$SARS: VAT $488964$Accumulated impairment loss Investment in EF $($Pty$)$ Ltd $817255$Allowances for doubtful debts $16444370$Gross profit $13502012$Ordinary share issue costs $2165000$Dividends paid $374000$Dividends received $950000$Interest paid $457500$Insurance compensation vehicle destroyed in fire $7120500$Impairment loss Investment in EF $($Pty$)$ Ltd $817255$Auditors remuneration $12157500$Directors remuneration $11105000$Doubtful debts $15566350$General expenses $13122500$Salaries and wages $10560000$Stationery $1718350020858500208585003$ADDITIONAL INFORMATION:Unless stated otherwise, the following information has not yet been accounted for in the accountingrecords of Alphabet Ltd:$1.$ Gross profit percentage on turnover amounts to $50\%\mathrm{.}2.$ Share capital consists of the following:Authorised$1000000$ Ordinary shares with no par value$1500008\%-$Preference shares with no par value $($part of equity$)$Issued$700000$ Ordinary shares with no par value R$94000001200008\%-$Preference shares $($part of equity$)130000010700000$On $1$ January $20$x$20,$ a further $100000$ ordinary shares were issued and allotted at R$17,50$ pershare. The costs arising from the issue of the ordinary shares were R$189750($including VAT$).$The accountant recorded the following in the accounting records:$20$x$20$Dr$.$RCr$.$R$1$ Jan Bank $($SFP$)1560250$Ordinary share issue costs $($SCE$)165000$VAT Input $($SFP$)24750$Ordinary application and allotmentaccount $($SFP$)1750000$Recognise the issuing of additional ordinaryshares$3.$ The following dividends were paid during the year:On $30$ June $20$x$20$ on the $8\%-$preference shares R$30000$On $31$ December $20$x$19,$ an interim dividend on the ordinary shares $4400074000$The directors recommended a final dividend of $14$ cents per ordinary share which will be paidon $1$ August $20$x$20\mathrm{.}44.$ The $8\%$ debentures were already issued on $1$ July $20$x$18.$The following interest was paid during the year:Debentures R$36500$Bank overdraft $21000575005.$ On $1$ July $20$x$19,$ a vacant stand adjacent to the existing property was purchased, which wasfinanced in full through the acquisition of a further mortgage bond of R$1500000$ from FinriteFinancers at an annual interest rate of $7,5\%.$ The loan is repayable in $5$ equal annualinstalments, which includes capital and interest. The accountant has correctly entered theacquisition of the property and the loan in the accounting records. The following repaymentschedule is applicable:PaymentRCapitalRInterestRCapitaloutstandingR$01$ July $20$x$19$ Loan $150000030$ June $20$x$20$ Instalment $1370747258247112500124175330$ June $20$x$21$ Instalment $23707472776169313196413730$ June $20$x$22$ Instalment $33707472984377231066570130$ June $20$x$23$ Instalment $43707473208204992834488130$ June $20$x$24$ Instalment $537074734488125866-6.$ On $1$ March $20$x$20,$ a new machinery item $($allocated to plant and equipment$)$ was purchasedfor cash at an invoice price of R$472075$ and correctly entered in the accounting records. On$30$ June $20$x$20$ it was determined that the recoverable amount on another machinery item waslower than its carrying amount. The subsequent impairment of the machinery item created aloss R$190000.$ This information still has to be entered into the accounting records$\mathrm{.}7.$ On $31$ January $20$x$20,$ one of the companys vehicles was destroyed in a fire on the premises.This vehicles original cost price was R$265000($excluding VAT$)$ and its carrying value on $1$July $20$x$19$ was R$208356.$ As the vehicle was destroyed by the fire, the insurance companypaid out an amount of R$138575($including VAT$),$ in full and final settlement. On $1$ March $20$x$20$a new vehicle was purchased for cash at R$575000($excluding VAT$).$ The accountant onlyrecorded the following in the accounting records:$20$x$20$Dr$.$RCr$.$R$31$ Jan Vehicles $($SFP$)120500$Insurance compensation $-$ vehiclesdestroyed in fire $($P$/$L$)120500$Recognise the insurance pay$-$out of claim$5$The following provision for depreciation for the year must still be made: Depreciation on vehicles $15\%$ p$.$a$.$ on the diminishing balance method Depreciation on plant and equipment $10\%$ p$.$a$.$ on straight$-$line method$8.$ Other financial investments are made up as follows:$80000$ ordinary shares of R$12,50$ each in CD Ltd$,$ listed on R$1000000$the JSE Ltd$31500$ ordinary shares of R$8,75$ each at cost in EF $($Pty$)$ Ltd $2756251275625$The following JSE listed share prices of CD Ltd are provided to you:Date Fair value pershare$01/07/20$x$19$ R$12\mathrm{.}5031/01/20$x$20$ R$11\mathrm{.}7530/06/20$x$20$ R$11\mathrm{.}259.$ Dividends received are made up of:Dividends received from CD Ltd R$45000$Dividends from EF $($Pty$)$ Ltd $50005000010.$ Included in the salaries and wages is R$80000$ paid to the managing director for her servicesas chief executive officer$\mathrm{.}11.$ Directors remuneration was paid to non$-$executive directors for attending board meetings$\mathrm{.}12.$ Auditors remuneration is made up as follows:For audit R$140000$Secretarial work $13000$Expenses $450015750013.$ The following items were included in general expenses:Electricity R$120000$Donations $3000015000014.$ Company tax, correctly calculated, amounted to R$442960\mathrm{.}615.$ On $4$ July $20$x$20,$ the business received a letter from the lawyer of Receivable Q$,$ who owedR$117500.$ This was to inform Alphabet Ltd that she was declared insolvent. The companyaccepted the lawyers offer of R$42500$ worth of inventories in part payment of her account.Her estate will pay out $65$ cents in the rand on the amount still owing but this will only bereceived in March $20$x$21.$ The balance must be written off as irrecoverable. No entries havebeen made to record any of these transactions$\mathrm{.}16.$ Assume a correctly calculated amount for distribution costs, administrative and other expensesof R$1788068.$ This amount includes any adjustment from the information provided.REQUIRED:a$)$ Present and disclose the abovementioned information in the Statement of Profit andLoss of Alphabet Ltd for the year ended $30$ June $20$x$20.(7)$b$)$ Present and disclose the abovementioned information in the Statement of Changes inEquity of Alphabet Ltd for the year ended $30$ June $20$x$20.(10)$c$)$ Calculate the amounts for the following line items in the Statement of Financial Positionof Alphabet Ltd as at $30$ June $20$x$20$: $(15)$ Other financial investments Inventories Cash and cash equivalents Long term borrowings Shareholders for dividendsd$)$ Present and disclose the following notes to the financial statements of Alphabet Ltd asat $30$ June $20$x$20.$ Show all workings and assume any further information you maydeem necessary. The notes relating to corporate information, compliance with IFRS,measurement bases and accounting policy are not required. $(40)$ Profit before Tax Property, Plant and Equipment $($land and buildings can be shown together$)$ Long$-$Term Borrowings