harrots

Harrots Department Store Pty Ltd is located in the city centre. During the past several years, profit has been declining because suburban shopping centres have been attracting business away from city areas. At the end of the company's financial year on 30 June 2015, the accounts shown below appeared in its adjusted trial balance: Accounts Payable 39 053 Accounts Receivable 16 830 Accumulated Depreciation-Office Equipment 28 142 Accumulated Depreciation-Store Equipment 59 774 Bank Loan 65 780 Cash 11 440 Cost of Sales 905 505 Depreciation Expense-Of 5 720 uipment Depreciation Expense-Store Equipment 13 585 Discount Received 1 430 17 160 Dividends 15 158 Electricity Expense 11 726 Freight-out 28 314 Income Tax Expense 28 314 Income Tax Payable 12 870 Insurance Expense 11 440 Interest Expense 5 720 Interest Revenue 51 766 Inventory 81 510 Office Equipment 6 435 Prepaid Insurance Rates and Taxes Expense 5 005 Rates and Taxes Payable 5 005 Rent Expense -Store 12 870 Office 28 600 Retained Earnings 20 306 Salaries Expense Sales 100 100 Office 57 200 Sales 1 301 300 20 020 Sales Commissions Expense 8 580 Sales Commissions Payable 14 300 Sales Returns and Allowances 42 900 Share Capital 178 750 Store Equipment Required a calculation of retained earnings (a) Prepare a fully classified statement of profit or loss, and a classified statement of financial position. (25 MARKS) Calculate the return on assets ratio, profit margin ratio, gross profit ratio, and (b) operating expenses to sales ratio. Assume that total assets at the beginning of the year were $228 800. (15 MARKS) (c) Why is it helpful to fully classify items in the statement of profit MARKS) or loss? (10