Fredo has the following trial balance at 31 December 2017 Ordinary Share Capital (1 shares) 800,000 Share premium 200,000 Property at cost 945,000 Property accumulated depreciation 120,000 Machinery at cost 660,000 Accumulated depreciation on machinery 240,000 Revenue 750,400 Purchases 315,680 Inventory at 1 1 2017 195,300 Retained earnings 245,660 Distribution and selling costs 110,000 Administrative expenses 98,850 5 Loan redeemable 2025 80,000 Tax provision 1,200 Cash and cash equivalents 2,370 Interest paid 2,000 Trade receivables 55,000 Trade payables 37,200 Dividend paid 20,000 Investments 75,000 2,476,830 2,476,830 Additional information Inventories at 31 12 2017 were valued at 205,080 During the year 100,000 new shares were issued at a 20 premium This has been included in the trial balance above At the year end, a customer owing 5,000 was declared bankrupt A provision of 2 of receivables is required Property consists of land at cost 495,000, the remainder being buildings which are depreciated at 5 on a straight line basis This has not yet been provided for and is to be treated as an administration cost Machinery is depreciated on a reducing balance basis at 10 This has not been accounted for but is to be part of cost of sales A dividend of 20,000 has been proposed at the year end The corporation tax expense for the year is expected to be 1,300 This has not yet been entered in the accounts Required Prepare the statement of financial position, statement of changes in equity and statement of profit or loss for the year ended 31 12 2017, in accordance with international accounting standards

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Posted on Sep 14, 2024

Fredo has the following trial balance at 31 December 2017 Ordinary Share Capital (1 shares) 800,000 Share premium 200,000 Property at cost 945,000 Property accumulated

Fredo has the following trial balance at 31 December 2017


Ordinary Share Capital (1 shares)		800,000
Share premium		200,000
Property at cost	945,000
Property accumulated depreciation		120,000
Machinery at cost	660,000
Accumulated depreciation on machinery		240,000
Revenue		750,400
Purchases	315,680
Inventory at 1.1.2017	195,300
Retained earnings		245,660
Distribution and selling costs	110,000
Administrative expenses	98,850
5% Loan redeemable 2025		80,000
Tax provision		1,200
Cash and cash equivalents		2,370
Interest paid	2,000
Trade receivables	55,000
Trade payables		37,200
Dividend paid	20,000
Investments	75,000
	2,476,830	2,476,830

Additional information:

Inventories at 31.12.2017 were valued at 205,080.

During the year 100,000 new shares were issued at a 20% premium. This has been included in the trial balance above.

At the year end, a customer owing 5,000 was declared bankrupt. A provision of 2% of receivables is required.

Property consists of land at cost 495,000, the remainder being buildings which are depreciated at 5% on a straight line basis. This has not yet been provided for and is to be treated as an administration cost.

Machinery is depreciated on a reducing balance basis at 10%. This has not been accounted for but is to be part of cost of sales.

A dividend of 20,000 has been proposed at the year end.

The corporation tax expense for the year is expected to be 1,300. This has not yet been entered in the accounts.

Required:

Prepare the statement of financial position, statement of changes in equity and statement of profit or loss for the year ended 31.12.2017, in accordance with international accounting standards.