Mr. Otuom Polo is the sole proprietor of a small business. The following trial balance was extracted from his books at 31 March 2000.

Sh. 000 Sh. 000

Capital

4,896

Freehold land and buildings (at cost) 3,600

Plant and machinery at cost 3,480

Provision for depreciation plant and machinery

1,680

Delivery vans 960

Provision for depreciation delivery vans

672

Loose tools at valuation on 1 April 1999 288

Stocks 1 April 1999 2,232

Purchases 4,440

Loose tools 192

Sales

15,840

Wages and Salaries 5,288

Rates and Insurance 384

Repairs and maintenance of buildings 240

Sales expenses including vehicle running costs 344

Electricity and power 1,440

Industrial training levy 72

Administration expenses 672

Provision for doubtfuldebts

240

Debtors and Creditors 1,984 1,928

Drawings 480

Bank

864

Cash in hand 24 _____

26,120 26,120

Additional information: 1. Closing stock on 3 1 March 2000 was Sh.2, 008,000. Loose tools at valuation Sh.384, 000.

2 .Provision is to be made for the following amount owing on 3 1 March 2000: Electricity and power Sh.192,000.

3. Payments in advance on 31 March 2000 were as follows: Van licenses Sh.2,520 and rates Sh.13,800.

4. Depreciation on plant and machinery and delivery vans is to be provided at the rate of 20% and 25% respectively on cost at the end of the year.

5. Bad debts amounting to Sh.26,000 are to be written off and the provision for doubtful debts is to be 10% of trade debtors.

Required: Prepare an income statement and a balance sheet as at the year ended 31 March 2000. (Total: 15 marks)