Mrs Penny Rigatoni is a sole trader who operates a health food business in Devon. The trial balance of the business at 31 December 2017 is presented below:

Trial Balance at 31 December 2017

Sales

130,500

Purchases

80,000

Rates

4,000

Motor expenses

1,820

Wages

24,100

Advertising expenses

3,000

Light and heat

4,500

Interest charges

175

Insurance

410

Sales returns

3,500

Telephone charges

125

Cost

8350

Property

125,000

Fixture and fittings

87,500

Motor vehicles

60,000

Accumulated depreciation at 1 January 2017

Property

8,750

Fixture and fittings

35,000

Motor vehicles

15,000

Inventory at 1 January 2017

4,750

Trade Receivables

9,500

Allowance for doubtful debts

500

Cash at bank

1,850

Cash in hand

120

Trade Payables

3,350

Loan and borrowings

3,500

Capital

220,000

Drawings

6,250

416600

416600

The following additional information is available at 31 December 2017:

The cost of inventory at the year-end was calculated to be 8,350

No depreciation charge has yet been made for the year. The rates of depreciation are:

Property: 2% straight line with zero estimated residual value

Fixtures and fittings: 20% straight line with zero estimated residual value

Motor vehicles: 25% reducing balance

The following bills have not yet been paid at the end of the year:

Motor expenses: 180

Telephone charges: 100

Required:

Prepare a statement of profit or loss for the year ended 31 December 2017 for Mrs Penny Rigatoni and a statement of financial position at that date