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QUESTION 1 [ 3 0 MARKS ) Kinta Baloyi Limited has an authorised share capital of 2 5 0 0 0 0 0 ordinary shares

QUESTION 1[30 MARKS)
Kinta Baloyi Limited has an authorised share capital of 2500000 ordinary shares of no-par value, of which 600000 had already been issued by the time the trial balance was prepared. The financial director requests your accounting knowledge in preparing the financial statements for the year ended 31 December 2021, and provides you with the following information:
Trial balance at 31 December 2021
Debit R Credit R
Property 1300000
Furniture and Equipment (carrying value)925000
Investments 150000
Bank 35000
Trade receivables 222000
Inventory 201000
Ordinary share capital (600000 shares)1200000
Retained earnings (1 January 2021)210000
Revaluation surplus (1 January 2021)225000
14% Loan from SABA Bank 100000
Trade payables 90000
Current tax payable 152000
Sales 4900000
Dividend income 55000
Interest income 15000
Profit on disposal of equipment 20000
Cost of sales 3020000
Distribution costs 360000
Operating costs 72000
Administrative costs 330000
Tax expense 352000
69670006967000
Additional information:
1. On 31 December 2021 it was estimated that the inventory has a net realisable value of R180000. No entries have yet been made for this.
2. The loan from SABA Bank was acquired on 1 January 2020 and is repayable in full on 1 January 2022. The Interest is payable annually in arrears on 1 January. Provide for the interest outstanding on the loan for the current financial period.
3. On 31 December 2021 the property was re-valued upwards by R300000 using the replacement value method. This revaluation still has to be recorded.
4. On 1 December 2021, Kinta Baloyi Ltd received cash for 125000 shares issued at R2 each, and all the shares were allotted on this day. This issue has not yet been recorded.
5. On 31 December 2021 the directors declared a dividend of 20 cents per share on all the issued shares, including those issued on 1 December 2021. No entries have yet been made for this.
6. In drafting the trial balance, all the expenses of Kinta Baloyi Limited had been allocated to the following four functions:
Cost of sales,
Distribution costs,
Operating costs, and
Administration costs
7. The above costs reflected on the trial balance include the following:
Depreciation on the sales department equipment, R55000
Depreciation on the office furniture and equipment, R65000
Salaries of the sales staff, R220000
Salaries of the office staff, R200000
REQUIRED:
a). Prepare general journal entries on 31 December 2021 for additional information numbers 1,2,3,4 and 5. You are not required to prepare the closing transfers for the write down of inventory and ordinary dividends accounts. (Dates and narrations may be omitted.)-10
b). Prepare the statement of comprehensive income of Kinta Baloyi Limited for the year ended 31 December 2021 in conformity with International Financial Reporting Standards. (Show your calculations in brackets.)-6
c.) Prepare the statement of changes in equity of Kinta Baloyi Limited for the year-ended 31 December 2021 in conformity with International Financial Reporting Standards.-7
d). Prepare the statement of financial position of Kinta Baloyi Limited at 31 December 2021 in conformity with International Financial Reporting Standards. (Show your calculations in brackets.)-7
END OF PAPER

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