Phi Ltd
 Date: 31 March 2024

Details:

• Raw materials inventory (wool):
  • Cost: £30,000
  • Replacement cost: £28,000
• Finished goods inventory:

Product	Epsilon	Zeta
Direct costs	£70,000	£55,000
Proportion of fixed overhead	£20,000	£15,000
Proportion of selling costs	£4,500	£3,500
Net realizable value	£105,000	£75,000

• Machinery:
   Acquired on 1 April 2017 for £400,000, depreciated over 12 years using the reducing balance method.
• Freehold property:
   Acquired 12 years ago for £2,300,000, land value estimated at £600,000. Buildings are depreciated over 50 years.
• Research and development:
  • Research costs: £100,000
  • Development costs: £125,000, benefiting over 5 years.

Required:
 Explain the financial statement impact of these items for Phi Ltd as of 31 March 2024.