Iota Plc
 Date: 31 December 2024

Trial Balance:

Description	Dr (£000)	Cr (£000)
Bank overdraft		190
Called-up share capital (ordinary shares of £1 each)		4,700
Accounts payable		220
Accounts receivable	200
Non-current assets: at cost	640
Accumulated depreciation (at 1 January 2024)		460
Marketing expenses	440
Office expenses	470
Retained profits (at 1 January 2024)		540
Production expenses	5,600
Purchases (net of VAT)	7,000
Sales (amounts invoiced, net of VAT)		14,000
Inventory (at 1 January 2024)	460
Trade accounts payable		490
Trade accounts receivable	5,700
Total	13,140	13,140

Additional Information:

1. Inventory at 31 December 2024 was valued at £530,000.
2. At 31 December 2024, £185,000 was owing for office expenses, and £175,000 had been paid in advance for marketing expenses.
3. A customer had gone into liquidation owing the company £630,000; the company does not expect to recover any of this debt.
4. The company decides to set up an allowance for doubtful debts amounting to 5% of the outstanding trade accounts receivable as at the end of each financial year.
5. Depreciation is to be charged on the non-current assets at a rate of 20% on cost; it is to be apportioned as follows:
   • Marketing: 25%
   • Office: 25%
   • Production: 50%

Note:
 There were no acquisitions or disposals of non-current assets during the year to 31 December 2024.

Required:
 Prepare Iota Plc’s income statement for the year ending 31 December 2024, and a balance sheet as at that date.