Hendon Ltd

For the year ended 31 July 2021 the accountant of Hendon Ltd has closed each of the ledger accounts to arrive at the following balances.

At 1 August 2020
Inventories	180,900
Retained earnings	170,555
Allowances for depreciation
Freehold buildings	20,000
Motor vehicles	28,000
Plant and Machinery	22,100
Rental Income	12,120
Sales	962,300
Trade receivables	112,870
Purchases	777,200
Trade payable	210,800
Discounts
Allowed	53,400
Received	27,405
Sundry Business Expenses
Wages	73,500
Salaries	74,000
Office	10,000
Directors remuneration	30,000
Dividends
Paid	40,000
Received	20,000
Interest
Paid	12,500
Received	10,000
Freehold Land	70,000
Freehold Buildings	160,000
Motor Vehicles	124,200
Plant and Machinery	74,300
10% debentures
31 July 2022	35,000
31 July 2025	90,000
Share premium account	66,000
25p ordinary shares	200,000
Investments	58,000
Bank (debit)	61,410
New share issue account	38,000

Following a physical count closing inventories were determined to be 210,000.

In addition, the accountant discovers the following.

1. The debenture interest is payable in arrears on 14 July until maturity.

2. One motor vehicle, stated in the accounts at cost of 8,000 with accumulated depreciation of 2,000, was stolen during the year. The insurance company has agreed to pay 7,000 in full settlement. No entries have been made in the books in respect of this matter.

3. The company depreciates assets using the reducing balance method. The relevant rates are as follows.

%

Freehold buildings 2

Plant and Machinery 10

Motor Vehicles 25

4. During the year the company issued 40,000 25p ordinary shares at 95 pence each. The proceeds have been credited to the new shares issue account and still need to be properly accounted for.

Requirements

Prepare a statement of profit or loss for the year ended 31 July 2021 and a statement of financial position as at 31 July 2021.