Lehlabile CC The following information pertains to Lehlabile CC and covers questions 14 26: Katlego and Tshepo are the only members of Lehlabile CC. The CCs financial year-end is 28 February. The following was presented to you as the accounting officer by the accountant. Extract of Balances as at 28 February 2023 Lehlabile CC R Extract of Balances as at 28 February 2023 Members contribution: Katlego 286 000 Members contribution: Tshepo 422 500 Retained earnings (1 March 2022) 325 000 Other reserves 159 900 Loan from member:Tshepo 136 500 Loan to member:Katlego 97 500 Land and buildings at cost 975 000 Equipment at cost 321 750 Accumulated depreciation:Equipment 121 524 Investments in Green Ltd (01 March 2022) 178 100 Inventory (01 March 2022) 71 500 Debtors control 133 594.5 Creditors control 61 412 Bank(dr) 48 100 Petty Cash 1 365 Mortgage 301 600 Allowance for settlement discount granted 1 950 Interim profit distribution paid to members 54 600 Income received in advance 6 864 Prepaid expenses 13 260 Allowance for credit losses 6 500 SARS(Dr) 72 280 Profit for the year before tax 137 300 Additional Information 1. Depreciation: The land was revalued to R1 000 000 on 28 February 2023. It is the policy of the close corporation not to depreciate land and buildings. Equipment is depreciated at 20% per annum on the Diminishing balancing method, no residual value. The depreciation amount for 2023 was correctly calculated as R42 675. Vehicles are depreciated on 10% per annum on the straight-line method with a residual value of 12% on cost of the asset. A new delivery vehicle with a cost of R250 000 was purchased and brought into use on 1 November 2022.The transaction was not recorded by the accountant. There were no disposals of, or additions to the land and buildings and equipment during the year. 2. The closing inventory amounted to R92 000 and is valued at the lower of cost or net realisable value according to the weighted average method. 3. Mr Fourie a debtor who owes the business R3 500 was declared insolvent, and his debt must be written off as irrecoverable. 4. An adjustment to the allowance for credit losses must be made to R4200. 5. On 20 February 2023 a trade debtor who owes R4 000 was offered a 4% settlement discount, on condition that she settles her account before 15 March 2023. The debtor informed Lehlabile that she intends to take the discount offer This offering must still be provided for. 6. The income tax assessment received from SARS on 15 March 2023, indicated that the actual normal income tax for the 2023 financial year amounted to R143 456. 7. Lehlabile holds an investment in Green Ltd which consists of 40 000 ordinary shares bought for R120 000. The shares were acquired in 2021 from Green Ltd, the investment was acquired for trade purposes. On 20 February 2023, Green Ltd declared a dividend of 70 cents per share, payable on 10 March 2023. On 28 February 2023, the fair value of the investment amounted to R195 000.The transaction was not accounted for in the books of Lehlabile. 8. A further profit distribution to the members of R30 000 payable on the 5th March 2023 still needs to be accounted for. 9. The loan from Tshepo is interest free and unsecured. The loan is repayable in 4 equal instalments, the first instalment is due 31 December 2023. 10. On the 19th February 2023 Lehlabile purchased stationery from Burgandy Ltd for R3 240 on credit. Lehlabile was offered a discount of 5% on the transaction provided they settle the outstanding amount within 25 days. Lehlabile made a payment on the 28 February 2023, the payment transaction was not recorded. 11. The mortgage was acquired from Tyla Bank on 1 March 2020 at an interest rate of 16,5% per annum. The loan is repayable in 6 equal instalments from 1 January 2025. Round off all amounts to the nearest rand. QUESTION 14 Which alternative represents the correct amount for carrying amount of land and buildings in the statement of financial position of Lehlabile CC as at 28 February 2023