Mu Ltd
 Date: 30 September 2024

Trial Balance:

Description	Dr (£000)	Cr (£000)
Bank overdraft		205
Called-up share capital (ordinary shares of £1 each)		5,000
Accounts payable		235
Accounts receivable	215
Non-current assets: at cost	670
Accumulated depreciation (at 1 October 2023)		490
Marketing expenses	470
Office expenses	500
Retained profits (at 1 October 2023)		570
Production expenses	5,900
Purchases (net of VAT)	7,300
Sales (amounts invoiced, net of VAT)		14,600
Inventory (at 1 October 2023)	490
Trade accounts payable		520
Trade accounts receivable	6,000
Total	13,710	13,710

Additional Information:

1. Inventory at 30 September 2024 was valued at £560,000.
2. At 30 September 2024, £200,000 was owing for office expenses, and £190,000 had been paid in advance for marketing expenses.
3. A customer had gone into liquidation owing the company £660,000; 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: 20%
   • Office: 30%
   • Production: 50%

Note:
 There were no acquisitions or disposals of non-current assets during the year to 30 September 2024.

Required:
 Prepare Mu Ltd’s income statement for the year ending 30 September 2024, and a balance sheet as at that date.