Q2. The trial balance extracted from the books of Tailor Times Ltd at 31 December 2016 was as follows: f 200,000 27,500 271,000 54,000 84,000 21,000 563,700 925,300 Share capital Retained profits 31 December 2015 Freehold premises at cost Provision for depreciation on freehold premises at 31 December 2015 Machinery at cost Provision for depreciation on machinery account as at 31 December 2015 Purchases Sales General expenses Wages and salaries Business rates Electricity Bad debts Allowance for doubtful debts at 31 December 2015 Accounts receivable Accounts payable Inventory at 31 December 2015 Bank balance 14,600 179,400 6,100 4,800 1,400 1,200 74,200 68,300 81,900 16,200 1,297,300 1,297,300 You are given the following additional information: The authorised and issued share capital is divided into 400,000 ordinary shares of 50p each. (ii) Inventory at 31 December 2016, 94,300. (iii) Wages and salaries due at 31 December 2016 amounted to 1,800. (iv) Business rates paid in advance at 31 December 2016 amounted to 700. (v) A dividend of 20,000 is proposed for 2016. (vi) The allowance for doubtful debts is to be increased to 1,500. (vii) A depreciation charge is to be made on freehold premises of 25,000 and machinery at the rate of 25 per cent per annum on cost. Required: A statement of profit or loss for 2016 and a statement of financial position as at 31 December 2016