Evon Bhd is a manufacturing company producing paper containers.

The following is the trial balance as at 31 December 2017.

Debit Credit

RM'000 RM'000

Revenue 202,000

Cost of Sale 89,200

Distribution Costs 16,400

Administrative expenses 14,500

Finance Costs 400

Inventory at 31 December 2017 22,900

Investment income 4,200

Trade receivables 32,000

Trade payables 35,000

Motor vehicles at cost 70,000

Freehold property at valuation 100,000

Plant at cost 130,000

Machinery at cost 40,000

Capitalised development expenditure at 1 January 2017 20,000

Accumulated depreciation and amortisation at 1 January 2017:

Motor vehicles 14,000

Freehold property 20,000

Plant 34,000

Machinery 6,000

Capitalised development expenditure 6,000

Investments at fair value at 1 January 2017 12,900

Ordinary shares capital 155,000

8% Redeemable preference share 10,000

Retained earnings at 1 January 2017 25,500

Asset revaluation reserves 700

Research and development expenditure 8,600

Deferred tax 14,000

Bank overdraft 30,500

556,900 556,900

The following information is relevant:

i. The freehold property was revalued at RM80 million on 31 December 2017. The estimated remaining life of the property on 1 January 2017 was 20 years.

ii. It is the policy of the company to use the straight-line method to depreciate all property, plant and machinery based on period of ownership. The estimated life of all plant, machinery and motor vehicles is 10 years. The depreciation charge is treated as administration expense.

iii. Research and development costs were incurred for a new project on 1 January 2017.The company has incurred RM1.4 million on research activities from that date until 30 June 2017. The development costs of RM1.2 million per month were incurred from 1 July 2017 until the end of the accounting year 31December 2017.This project is expected to be successful and will generate income to the company. All development costs are capitalised and amortised at 10% per annum using straight line method and charged to cost of sales. The research and development costs incurred during the year were paid but not yet appropriately accounted for in the financial statements.

iv. The estimated tax payable for the year was RM17.1 million. This does not include a decrease of the companys taxable temporary difference during the year of RM4.8 million. The income tax rate for 2015 is 25%.

v. The finance cost of RM400,000 represents amount paid to the holders of the redeemable preference share capital.

Required: Prepare the following statements in a form suitable for publication and in compliance with MFRS 101(2009) Presentation of Financial Statements:

a) The Statement of Profit or Loss and Other Comprehensive Income for the year ended 31 December 2017.

b) The Statement of Financial Position as at 31 December 2017.