PRESENTATION OF FINANCIAL STATEMENTS (IAS 1) Question 1 The following trial balance has been extracted from the books of Tembo Ltd as at 31 December 2019. K K Equity share capital (K1) 270,000 Share Premium 80,000 Revaluation Surplus 20,000 Dividends paid 27,000 Retained earnings at 1 January 2019 235,000 Revenue 2,165,000 Inventory at 1 January 2019 140,000 Purchases 1,260,000 Distribution costs 295,000 Administrative expenses 250,000 Loan interest 25,000 Dividends received 15,000 Interest received 1,000 Receivables and payables 233,000 27,000 Bank 3,000 Land - cost 380,000 Buildings cost 100,000 Plant and machinery cost 400,000 Buildings - accumulated depreciation 1 January 2019 30,000 Plant and machinery accumulated depreciation 1 January 2019 170,000 Debentures (2022) 100,000 Total 3,113,000 3,113,000 Additional information: 1. Depreciation for the year is to be charged against cost of sales as follows: (a) Buildings 5% on cost straight line (b) Plant and machinery 30% on carrying amount (reducing balance). 2. Land is to be revalued upwards to K100,000. 3. Inventory at the end of the year was valued at cost of K95,000. Included in this amount were goods that had cost K15,000. These goods had become damaged during the year and it is considered that the goods could be sold for K5,000, after paying commission of K500. 4. Income tax of K165,000 is to be provided for the year to 31 December 2019. Required: Prepare a statement of profit or loss and other comprehensive income, statement of changes in equity and a statement of financial position for the year ended 31 December 2019.