PART A

The following balances have been extracted from the books of UKusefwa Pangwenaco. Ltd as at 30thSeptember 2015:

K'000

Sales240 000

Land at cost103 200

Buildings at cost114 000

Furniture and fittings at cost66 000

Depreciation: Buildings18 000

Furniture and fittings30 000

Bank (credit balance)18 000

Discount received5 292

Unappropriated profit at 1stOctober 20146 000

Provision for doubtful debts2 448

Cash in hand696

Stock at 1stOctober 201442 744

Interim dividend on preference shares1 800

Rates6 372

Salaries and wages24 000

Insurance5 668

Returns inwards1 116

General expenses1 308

Debtors37 920

Creditors18 900

Purchases131 568

Debenture interest1 200

Bad debts2 028

5% debentures48 000

6% K1 000 preference shares60 000

K1 000 ordinary shares60 000

General reserve30 000

Share premium3 000

Additional information:

1.Stock on hand at 30thSeptember 2015 was K46 638 000.

2.Insurance paid in advance K300 000.

3.Wages owing K840 000.

4.Depreciation is to be provided at 10% on cost of buildings, and at 20% on the written down value of furniture and fittings.

5.Provision for doubtful debts is to be reduced to 5% of debtors.

6.Debenture interest outstanding is K1 200 000.

7.The directors propose to pay a 5% ordinary dividend and the final preference dividend, and to transfer K24 000 000 to general reserve.

8.The corporation tax charge for the year is K20 000 000.

You are requiredto prepareTrial balance andincome statement and Balance Sheet