Prada Corporation is a public retail company which follows IFRS. Justin Reece, the companys controller, recently prepared an Income Statement and a Statement of Retained Earnings for the year ending December 31, 2020 (see below). Reece believes that both statements fairly present the companys performance but confesses that he has not familiarized himself recently with the latest financial reporting standards under IFRS.

Prada Corporation uses a tax rate of 35% for all applicable items. Some items are shown on a before tax (or pre-tax) basis while other items are shown on an after-tax (or net of tax) basis.

PRADA CORPORATION

Income Statement (prepared by controller)

For the Year Ended December 31, 2020

Sales 452,109

Cost of goods sold 214,446

Selling expenses 81,305

Administrative expenses 57,418 353,169

Income before gains and (losses) and income tax 98,940

Other gains and (losses)

Gain on remeasurement of FV-OCI investment (pre-tax) 37,500

Dividends received 44,000

Correction for depreciation error made in 2019 (pre-tax) (26,440) 55,060

Income before income taxes 154,000

Income tax expense (53,900) (10,400)

Income before loss from tornado 100,100

Loss from tornado (net of tax) (10,400)

Net income $89,700

PRADA CORPORATION

Statement of Retained Earnings (prepared by controller)

For the Year Ended December 31, 2020

Retained Earnings January 1, 2020 $155,000

Add:

Net income $89,700

Loss due to write down of inventory (net of tax) (9,100) 80,600

Retained Earnings December 31, 2020 $23 5,600

Additional information is as follows:

1. On January 1, 2020, the balance in the Accumulated Other Comprehensive Income account was $134,000.
2. During the year, additional common shares were issued for $100,000. On December 31, 2020, the common shares account had an ending balance of $515,000.
3. The weighted average number of common shares issued and outstanding throughout 2020 was 200,000 shares.

Required:

1. Prepare in good form a Statement of Comprehensive Income in multiple-step format for Prada Corporation for the year ending December 31, 2020. (12 marks)

2. Prepare in good form a Statement of Changes in Equity for Prada Corporation for the year ending December 31, 2020. (8 marks)

Note: Both statements must comply with IFRS reporting standards.