FINANCIAL STATEMENTS FOR PUBLICATION COMPANIES TRADING IN GOODS QUESTION The trial balance of CPI Limited as at 31 December, 2018 is as follows: Debit Credit GH Sales and Purchases GH 20,000 Inventory 50,000 Marketing and Distribution costs 8,000 Administration expenses 8,000 Trade Receivables and Payables 15,550 Cash and bank 12,400 20,000 8.100 Ordinary shares (GH0.50) $2,000 Revaluation reserve 8,000 10% Redeemable preference shares (GH1) 9,000 10% Loan Notes 8,000 Property, Plant and Equipment 75,000 Investment Property 10,000 Rental income from investment property 1,000 Retained profits (1" January, 2018) 3,000 Loun note interest 400 Preference dividend 450 Interim ordinary dividend 1,600 Corporate Tax 500 Suspense 8,000 159,500 159.500 The following is to be taken into account: 1. The inventory at cost on 31" December, 2018 was GH14,500 and the net realizable value was GH12,000. 2. The Property, Plant and Equipment include a building whose net book value is currently GH45,000 is to be revalued to GH49,000. 3. The balance on the corporation tax account represents an overprovision of tax for the previous year. Tax for the current year is estimated at GH 3,000. 4. The directors have decided to make an allowance for doubtful debts of 2% of trade receivables. This amount should be charged to administrative expense. 5. Depreciation charges for the year ended 31" December 2018 amounted to GH800. This figure should be included in the administrative expense. QUESTION 2 as at 31 The following is the trial balance of Kwei Limited, a dealer in Oracle Software, December, 2018 GH GH Revenue 490,500 Purchases 243,750 Ordinary shares (GH2.00/share) 200,500 Retained profits 60,000 Revaluation Surplus 10,000 10% Loan Note 21,000 Inventory (1/12/2018) 99,000 Trade Receivables 159,000 Trade Payables 121,000 Loan interest paid 2,100 Land and building (cost) 125,000 Delivery Vans: (cost) 105,500 Plant and Equipment: (cost) 90,000 Investment property 97,900 Administrative expenses 26,000 Selling and Distribution expenses 27,500 35,000 44,500 1,750 Investment income Cash and cash equivalents Dividend paid 2 1) The inventory at cost on 31" December, 2018 was valued at GH4137,500 and the net 2) Allowance for doubtful debt is to be increased to GH 19,000 as at 31 December 2018 Provision for doubtful debts Suspense 1.022.000 14,000 70.000 1.022.000 Additional information available is given below realizable value was GH129,500. 3) An amount of GH6.000 in respect of rent and rates is included in administrative expenses. This amount relates to 2019 financial year, 4) Depreciation for the year ended 31 December 2018 is to be calculated using the following rates: Plant and equipment 10% on cost Administrative expense Delivery Vans 15% on cost Distribution cost. 5) To reflect a market increase in property prices, Kwei Limited accepted the report of an independent surveyor who valued the land and building up by GH15,000 on that on 31" December 2018 1) The audit fee of GH1,000 is to be accrued. This should be treated as administrate expense. 2) The suspense account represents the corresponding credit for cash received for a fully subscribed issue of equity shares made on 30 December 2018. The terms of the share issue was 35,000 new ordinary shares were issued at GH2 each. 3) The directors have estimated the provision for income tax for the year ended 31" December 2018 at GH15,000. Required: In compliance with the Companies' Code provisions and in conformity with relevan International Financial Reporting Standards, prepare for publication; (0) the statement of profit or loss and other comprehensive income for the year ended 3 December, 2018. the statement of changes in equity for the year ended 31" December, 2018. (iii) the statement of financial position as at 31 December, 2018