Konta plc is in the process of finalising its financial statements for the year ended 30th April 2020 and has approached you for advice on the following issues:

a) During the financial year, Konta set up a joint venture, Sampras Ltd with Goolagong plc. Each company had 50% of the shares in Sampras. Konta also had an associate, Graf Ltd. During the year, the following transactions occurred:

• Konta sold 50,000 of goods to Sampras. A full allowance has been made against the balance.
• Konta sold 30,000 of goods to Goolagong.
• Konta purchased goods from Graf for 10,000, the market price of the goods. (5 marks)

b) On the 9th May 2020 one of Kontas customers entered administration. The balance on trade receivables in the draft financial statements included 108,000 owing from this customer. (4 marks)

c) During April 2020 the directors decided to restructure operations. A restructuring plan was approved by the board on 15th April 2020. As part of withdrawal from its operations in South America, it would close down its only manufacturing site in the region, making all workers redundant and putting the site up for sale. A local agent was appointed in late April to sell the site. It is expected that the site will sell within 4 months due to its excellent location. The workers were informed of the closure on 25th April 2020, the same day a public announcement was made to news media. (9 marks)

Requirement

For each of the issues a) to c) above, EXPLAIN the implication for the financial statements for the year ended 30th April 2020, including how any items would be disclosed or presented in the financial statements.