c$)$ The following balances have been extracted from books of account of MEGAWISE ENTERPRISE.

MEGAWISE ENTERPRISE TRIAL BALANCE

AS AT $31$ST DECEMBER $2022$

Debit $($Kshs$)$ Credit $($Kshs$)$ Bank balance $1,500,000$

Capital $2,460,000$

Cash $200,000$

Discounts allowed $56,000$

Discount received $50,000$

Drawings $250,000$

Fixture & fittings$-$ cost $1,400,000$

Provision for depreciation on

Fixtures $350,000$

Light and heat $90,000$

Provision for doubtful debts $6,000$

Purchases $1,300,000$

Rents and rates $170,000$

Sales $2,000,000$

Stock $200,000$

Trade creditors $685,000$

Trade debtors $200,000$

Wages $185,000$

$5,725,0005,725,000$

Additional Information

The following matters are taken into account before preparation of the final accounts.

i$.$ The stock take on $31$st December $2022$ valued the shops stock at Kshs $300000,$ at cost

ii$.$ At $31$st December $2022$ rent and rates were prepaid by Kshs $20000$ and there was an outstanding bill of Kshs $15000$ for wages

iii. The fixtures and fittings are to be depreciated by Kshs $50000$ iv$.$ The provision for doubtful debts is to be $5\%$ of the debtors at the year$-$end Required:

a$)$ Prepare an Income statement for the period ended $31$ December $2022(6$ Marks$)$

b$)$ Prepare the statement of financial position as ta $31$ December $2022(6$ Marks$)$