Prepare the following: i. Statement of profit and loss ii. Statement of changes in equity iii. Statement of financial position

8. The following balances were obtained from the books of KLM plc as at December 31, 2 $ 35,000 450,000 100,000 450.000 150,000 35,500 220,000 72.160 Creditors 81.200 50,000 140.000 General reserves Ordinary shares @ $1 5% Preference shares @ $0.50 Premises 5% Debenture Retained earnings Goodwill Debtors M Management expenses Motor vehicles Provision for dep'n on vehicle Sales . Cost of sales . Fixtures & fittings Provision for dep'n on fix & fit Stock at Dec 31, 2018 Insurance Directors' fees Debenture interest Interim ord, shares dividends Cash & bank Wages & salaries 28.000 1.800.000 1,050.000 60,000 12.000 250.100 15,000 20,000 7.000 12.000 255,440 90,000 2.691.700 2.691.700 Additional information: a. Provide for depreciation as follows: fixtures and fittings 5% on cost, and motor vehicles 10% on cost. Depreciation charges should be applied equally between selling costs and administration expenses b. Wages and salaries is owing by $10,000, and insurance is owing $5,000 c. The total preference share dividend is to be honoured d. The following expenses must be appropriated: Admin Selling & Dist Wages & salaries 80% 20% Insurance 3/4 1/4 Management fees 50% 50% Directors' fees 100% e. Goodwill impairment was estimated to be $30,000 f. Corporation tax is estimated at $25,000 g. Transfer $25,000 to general reserves Required: Prepare the following financial statements for the year: i. Statement of profit or loss ii. Statement of changes in equity iii. Statement of financial position 7. The following balances were obtained from the books of The Hartland Ltd as at December 31, 2015: CR DR 800.000 250.000 40.000 100,000 110.000 65,000 30.000 30,000 200,000 200,000 50,000 DETAILS Premises 10% Mortgage Retained earnings Goodwill Debtors Creditors General reserves Management fees Ordinary shares @ $0.50 5% Preference shares @ $1 Share premium Motor vehicle Prov. for depreciation on motor vehicle 10% Debenture Mortgage interest Debenture interest Cost of sales Closing stock Insurance Wages & salaries Interim ordinary shares dividend Bank Sales Commission received 80,000 12.000 120,000 7,000 5,000 750.000 80,000 20,000 60,000 2.000 53,000 1.100.000 4.000 2,084,000 2,084,000 Notes: a. Provide for depreciation on motor vehicle at 5% on the reducing balance b. Insurance is prepaid by $4.000 while wages and salaries is owing by $20,000 c. The goodwill should be written down by 25% d. Transfer $25,000 from profits to the general reserves e. Corporation tax is estimated at $30,000 2 f. The following items of expense should be apportioned: Insurance Wages & salaries Management fees Depreciation charges Admin 50% 70% 80% 50% Sell & Dist. 50% 30% 20% 50% g. Prior to the end of the year the directors approved the following: preference share dividends is to be counted for in full f. The following items of expense should be apportioned: Insurance Wages & salaries Management fees Depreciation charges Admin 50% 70% 80% 50% Sell & Dist. 50% 30% 20% 50% g. Prior to the end of the year the directors approved the following: i. preference share dividends is to be accounted for in full ii. a new issue of 100,000 ordinary shares with par of $0.50 per share; amount collected was $75,000