Permata Bhd, a company engaged in the manufacturing of equipment for producing textiles, agricultural industry and investment property, has an authorized capital of 200 million ordinary shares of RM1 each and 100 million 5% Non-redeemable preference shares of RM1 each. Given below is the trial balance as at 30 June 2020 prepared by the company's accounts assistant: Debit (RM) Credit (RM) 100,095,000 25,040,000 18,000 13,400,000 4,200,000 28,400,000 144,400,000 850,000 Revenue Costs of sales Biogical assets Land at valuation Plant at cost Building at cost Equipment at cost Deferred development expenditure Accumulated depreciation and amortisation as at 1 July 2019: Plant Building Equipment Deferred development expenditure Administrative costs Selling and distribution costs Finance costs Inventory at 30 June 2020 Trade receivables Trade payables Bank loan Cash at bank Tax paid Investments Dividend income Ordinary shares of RM1 each (issued and fully paid) Non-redeemable preference shares of RM1 each Preference dividend paid Tax recoverable at 1 July 2019 Retained earnings at 1 July 2019 Land revaluation reserve 1,260,000 4,260,000 83,880,000 85,000 8,560,000 4,460,000 3,680,000 4,300,000 7,860,000 4,260,000 20,000,000 12,410,000 9,720,000 30,982,000 100,000 47,000,000 25,000,000 1,200,000 800,000 13,940,000 400,000 300,280,000 300,280,000 Additional information: 1. On 1 July 2019, the land and building were revalued at their fair market value of RM12,000,000 and RM30,000,000 respectively. The land has been revalued before resulting in a surplus of RM400,000, but it was the first revaluation for the building. The remaining useful life of the building as at that date is 40 years. The company adopts the revaluation model for the land and building. 2. On 1 January 2020, Permata Bhd purchased an equipment at a cost of RM1,000,000. The company issued 500,000 ordinary shares at RM1.00 each to partly finance the purchase price. The remaining balance was still unpaid. No adjustment has been made in the books of Permata Bhd for this acquisition. It is the policy of the company to depreciate all equipment on a straight line basis at the rate of 10% per annum based on yearly basis. 3. On 27 June 2020, Permata Bhd discovered that the payment of RM300,000 to purchase a customer list from Sukaramai Services was included as administrative expense. That purchase was made on 1 March 2020 and the capitalised intangibles are being amortised over 5 years. 4. On 3 February 2020, Permata Bhd received a claim from one of its customers, Teja Enterprise in respect of a faulty equipment supplied to business on 20 December 2019. Permata's legal advisers were of the opinion that there was 80% change that the claim would be settled at RM800,000. 5. On 1 July 2019, Permata Bhd had 10,000 ducklings and on 1 January 2020, the company purchased 1,000 ducks. The payment was made by cheque. The fair value less cost to sell per animal is determined to be as follows: 1 July 2019 1 Jan 2020 30 June 2020 Ducklings RM 1.80 2.00 2.30 Ducks RM 7.00 8.00 9.30 No animals were sold or disposed of during the period and cattle become mature after one year. 6. On 1 July 2019, Permata Bhd acquired a new machinery costing AUD25,000,000 from Australia to support its business operation. The exchange rate on the acquisition date was AUD1:RM3.40. A quarter of the payment has been made by Permata Bhd on the same date. As at 30 June 2020, the company had not made any payment for the remaining balance to the supplier and the exchange rate on that date was AUD1: RM3.70. The machinery will be depreciated on a straight line basis over 10 years (charge to administration expenses) 7. On 30 June 2020, Permata Bhd incurred the development costs of RM1,500,000 for a product namely Cantek Molek. The criteria for capitalisation has been fulfilled. Then the development project is deemed to be completed. This transaction has not been recorded in the books. Expenses paid with cheque. Deferred development expenditure will be amortised on straight line basis over 10 years. (charged to administrative expenses) 8. Permata Bhd purchased an investment property amounted to RM5,600,000 on 1 July 2019 (paid with cheque). The company adopts cost model as subsequent measurement for its investment property. On 30 June 2020, quarter of the investment property has been destroyed in fire disaster. This situation has affected the revenue income related to the investment property. The professional valuer has assessed that the fair value of the investment property was determined to be RM5,300,000 and the cost of sales broker to sell the building was amounted to RM300,000. The present value of projected cash inflows of the said investment property was RM5,200,000. No recording has been made for these transactions. The investment property will be depreciated on a straight line basis over 40 years (charge to administration expenses). 9. The board of directors agreed to provide the allowance for impairment of trade receivables at 6% of the trade receivables. The company has never made any allowance for impairment of trade receivable before. 10. Inventories costing RM6,000 has been damaged and cannot be sold anymore. 11. An equipment experience breakdowns due to rigorous usage on 1 January 2020. It has undergone major repair at the cost of RM300,000. The amount has been paid with cheque. This repair has reduced the production cost substantially and it has not been recorded in the books. 12. The company also decided to dispose an equipment purchased on 1 July 2017 at a cost of RM1,000,000. This equipment was sold on 1 January 2020 for RM1,200,000. 13. On 30 June, Permata Bhd also acquired a plant amounted to RM1,500,000 on credit. Cost of dismantling and restoration at the end of 10th year amounting to RM300,000 which has a present value of RM240,000. This has not been recorded. Plant will be der ciated on a straight line basis over 10 years. (charge to administrative expenses) 14. The tax charge for the year is estimated to be RM12,500,000. You are required to prepare the following financial statements in a form suitable for publication and in compliance with the Companies Act 1965 (as amended) and Malaysian Financial reporting Standard (MFRs): d. Statement of financial position as at 30 June 2020. (A note on property, plant and equipment is required) Permata Bhd, a company engaged in the manufacturing of equipment for producing textiles, agricultural industry and investment property, has an authorized capital of 200 million ordinary shares of RM1 each and 100 million 5% Non-redeemable preference shares of RM1 each. Given below is the trial balance as at 30 June 2020 prepared by the company's accounts assistant: Debit (RM) Credit (RM) 100,095,000 25,040,000 18,000 13,400,000 4,200,000 28,400,000 144,400,000 850,000 Revenue Costs of sales Biogical assets Land at valuation Plant at cost Building at cost Equipment at cost Deferred development expenditure Accumulated depreciation and amortisation as at 1 July 2019: Plant Building Equipment Deferred development expenditure Administrative costs Selling and distribution costs Finance costs Inventory at 30 June 2020 Trade receivables Trade payables Bank loan Cash at bank Tax paid Investments Dividend income Ordinary shares of RM1 each (issued and fully paid) Non-redeemable preference shares of RM1 each Preference dividend paid Tax recoverable at 1 July 2019 Retained earnings at 1 July 2019 Land revaluation reserve 1,260,000 4,260,000 83,880,000 85,000 8,560,000 4,460,000 3,680,000 4,300,000 7,860,000 4,260,000 20,000,000 12,410,000 9,720,000 30,982,000 100,000 47,000,000 25,000,000 1,200,000 800,000 13,940,000 400,000 300,280,000 300,280,000 Additional information: 1. On 1 July 2019, the land and building were revalued at their fair market value of RM12,000,000 and RM30,000,000 respectively. The land has been revalued before resulting in a surplus of RM400,000, but it was the first revaluation for the building. The remaining useful life of the building as at that date is 40 years. The company adopts the revaluation model for the land and building. 2. On 1 January 2020, Permata Bhd purchased an equipment at a cost of RM1,000,000. The company issued 500,000 ordinary shares at RM1.00 each to partly finance the purchase price. The remaining balance was still unpaid. No adjustment has been made in the books of Permata Bhd for this acquisition. It is the policy of the company to depreciate all equipment on a straight line basis at the rate of 10% per annum based on yearly basis. 3. On 27 June 2020, Permata Bhd discovered that the payment of RM300,000 to purchase a customer list from Sukaramai Services was included as administrative expense. That purchase was made on 1 March 2020 and the capitalised intangibles are being amortised over 5 years. 4. On 3 February 2020, Permata Bhd received a claim from one of its customers, Teja Enterprise in respect of a faulty equipment supplied to business on 20 December 2019. Permata's legal advisers were of the opinion that there was 80% change that the claim would be settled at RM800,000. 5. On 1 July 2019, Permata Bhd had 10,000 ducklings and on 1 January 2020, the company purchased 1,000 ducks. The payment was made by cheque. The fair value less cost to sell per animal is determined to be as follows: 1 July 2019 1 Jan 2020 30 June 2020 Ducklings RM 1.80 2.00 2.30 Ducks RM 7.00 8.00 9.30 No animals were sold or disposed of during the period and cattle become mature after one year. 6. On 1 July 2019, Permata Bhd acquired a new machinery costing AUD25,000,000 from Australia to support its business operation. The exchange rate on the acquisition date was AUD1:RM3.40. A quarter of the payment has been made by Permata Bhd on the same date. As at 30 June 2020, the company had not made any payment for the remaining balance to the supplier and the exchange rate on that date was AUD1: RM3.70. The machinery will be depreciated on a straight line basis over 10 years (charge to administration expenses) 7. On 30 June 2020, Permata Bhd incurred the development costs of RM1,500,000 for a product namely Cantek Molek. The criteria for capitalisation has been fulfilled. Then the development project is deemed to be completed. This transaction has not been recorded in the books. Expenses paid with cheque. Deferred development expenditure will be amortised on straight line basis over 10 years. (charged to administrative expenses) 8. Permata Bhd purchased an investment property amounted to RM5,600,000 on 1 July 2019 (paid with cheque). The company adopts cost model as subsequent measurement for its investment property. On 30 June 2020, quarter of the investment property has been destroyed in fire disaster. This situation has affected the revenue income related to the investment property. The professional valuer has assessed that the fair value of the investment property was determined to be RM5,300,000 and the cost of sales broker to sell the building was amounted to RM300,000. The present value of projected cash inflows of the said investment property was RM5,200,000. No recording has been made for these transactions. The investment property will be depreciated on a straight line basis over 40 years (charge to administration expenses). 9. The board of directors agreed to provide the allowance for impairment of trade receivables at 6% of the trade receivables. The company has never made any allowance for impairment of trade receivable before. 10. Inventories costing RM6,000 has been damaged and cannot be sold anymore. 11. An equipment experience breakdowns due to rigorous usage on 1 January 2020. It has undergone major repair at the cost of RM300,000. The amount has been paid with cheque. This repair has reduced the production cost substantially and it has not been recorded in the books. 12. The company also decided to dispose an equipment purchased on 1 July 2017 at a cost of RM1,000,000. This equipment was sold on 1 January 2020 for RM1,200,000. 13. On 30 June, Permata Bhd also acquired a plant amounted to RM1,500,000 on credit. Cost of dismantling and restoration at the end of 10th year amounting to RM300,000 which has a present value of RM240,000. This has not been recorded. Plant will be der ciated on a straight line basis over 10 years. (charge to administrative expenses) 14. The tax charge for the year is estimated to be RM12,500,000. You are required to prepare the following financial statements in a form suitable for publication and in compliance with the Companies Act 1965 (as amended) and Malaysian Financial reporting Standard (MFRs): d. Statement of financial position as at 30 June 2020. (A note on property, plant and equipment is required)