Question 1 [15 marks]

South Africa Corporation has been in the business of delivering small packages for local companies within the City of Tshwane, since the year 2000. The following information concerning financial activities during 2022 is available as at 31 December 2022:

Delivery revenue	R380,000	Salary and wage expense			R82,000
Dividends declared and paid	85,000	Rent expense			43,000
Buildings	140,000	Land			60,000
Accounts Receivables	40,000	Accounts Payable			30,000
Capital stock	105,000	Retained earnings, 1 January 2022			42,000
Water, gas, and Electricity	28,000	Notes payable			34,000
Cash				56,000		Income tax expense	18,000

1. Prepare an income statement for the year ended 31 December 2022. (9)

2. If you were a bank loan officer and South Africa Corporation wanted to borrow R100,000 from your bank, would you lend the money? Explain. (3)

3. Calculate retained earnings at 31 December 2022. (3)