.

COMPANIES

IGNORE VAT

You are provided with the Trial balance, Adjustments and Additional information at 31 December 2018.

WORLD CUP LIMITED TRIAL BALANCE AT 31 DECEMBER 2018	R DR/ (CR)
Share capital	(125 000)
Preference share capital	(50 000)
Retained earnings (31 December 2017)	(18 500)
Investment in Trophy (Pty) Ltd	36 000
Goodwill	17 000
Debentures (10% p.a.)	(25 000)
Property - Cost	209 000
Vehicles Cost	45 000
Equipment Cost	26 500
Accumulated depreciation on vehicles	(27 000)
Accumulated depreciation on equipment	(12 500)
Trade Receivables	39 875
Trade Payables	(25 022)
Inventory	24 500
Consumable store (asset)	6 500
Allowance for doubtful debts	(1 300)
Bank	(6 560)
Sales	(250 832)
Sales returns	2 150
Cost of sales	101 010
Bad debts	983
Bank Charges	1 421
Commission income	(5 870)
Interest on overdraft	1 450
Insurance	1 800
Interim dividend on ordinary shares	4 000
Maintenance	1 547
Rent income	(14 022)
Salaries	35 870
Share issue expense	7 000

Adjustments and additional information:

1. Issued share capital consists of:

200 000 - Ordinary shares.

5 000 - Non-redeemable preference shares.

2. The stock count at year-end revealed the following:

• Inventory R21 600
• Consumable Stores R450

3. The vehicles were purchased on 1 January 2015. Vehicles have a useful life of 5 years and are depreciated on the straight-line method. No depreciation was calculated for the current year.
4. Equipment must be depreciated at 15% per annum on the diminishing balance method.
5. The bank statement revealed that the following transactions still had to be taken into consideration.

• An annual insurance premium of R1 200 had been paid by stop order.
• A credit customer had deposited an amount of R660 directly into the companys bank account.
• The bank charged R54 interest on overdraft and R29 other bank charges.

6. Salaries owing at year-end amounted to R1 900.
7. The allowance for doubtful debts needs to be adjusted to R1 000.
8. Goodwill is to be completely written off.
9. Share issue expenses are to be written off.
10. Commission owing to World Cup Limited at year-end is R750.
11. Trophy (Pty) Ltd declared a dividend of R2 750, but this amount has not yet been received or recorded by World Cup Limited.
12. Company tax amounted to R11 500 for the year and has not yet been paid.
13. No provision has been made for the interest on debentures for the year.
14. The directors declared a dividend of 120c per preference share.
15. World Cup Limited paid an interim dividend of 2c per ordinary share on 30 June 2018. The directors declared a final dividend of 7c per ordinary share.

REQUIRED

Note: Show and reference all workings. Round off to the nearest Rand.

(a)	Prepare the Statement of profit or loss and other comprehensive income for the year ended 31 December 2018.
(b)	Prepare the Statement of financial position as at 31 December 2018 (Equity and Liabilities section only)