Question $1$

$($Marks: $100)$

You have been appointed to assist the accountant of Freedom$-$Co $($Pty$)$ Ltd in preparing the financial statements for the year ended $31$ December $2024.$ You have been provided with the following trial balance for the year ended $31$ December $2024$:

$\backslash$table$[[,$Debit,Credit$],[$R$1$ Ordinary shares,,$7800000],[$Retained earnings at the beginning of the year,,$1275000],[$Inventory at the beginning of the year,$8100000,],[$Land at cost$,5400000,],[$Buildings at cost$,16200000,],[$Buildings accumulated depreciation at the beginning of the year,,$4050000],[$Pant at cost$,18000000,],[$Plant accumulated depreciation at the beginning of the year,,$6750000],[$Motor vehicles at cost$,6000000,],[\backslash$table$[[$Motor vehicles accumulated depreciation at the beginning of the$],[$year$]],,2100000],[$Trade payables,,$16200000],[$Trade receivables,$10800000,],[$Provision for credit losses at the beginning of the year,,$450000],[$Purchases$,36750000,],[$Revenue$,,54000000],[$Administrative expenses,$3750000,],[$Distribution expenses,$4350000,],[$Other expenses,$900000,],[$Bank$,1950000,],[$Ordinary dividend paid,$750000,],[5\%$ Preference shares at R$1,,9000000],[9\%$ Loan,,$9000000],[$Other income,,$2325000],[112950000,112950000]]$

Taxation accrual for the period was estimated at R$1020000.$

The company issued bonus shares to the shareholders at $1$ bonus share for every $5$ held. This is a non$-$cash transaction.

An ordinary dividend of $R750000$ was declared at year end.

A transfer of R$1500000$ was made from retained earnings to general reserves.

any prepares its statement of profit and loss in accordance with the function Required:

Q$\mathrm{.}1\mathrm{.}1$ The managing director has asked you why the disclosure of the property, plant

$(18)$

and equipment note is so onerous.

You have been tasked to write a report to the managing director explaining how the property, plant and equipment note meets the criteria of the fundamental qualitative characteristics and the enhancing qualitative characteristics as described in the conceptual framework.

Your answer should list and explain what each qualitative characteristic is and discuss how each characteristic is met in the disclosure of the property plant and equipment note.

Q$\mathrm{.}1\mathrm{.}2$ Prepare all the journal entries relating to the additional information in points $6$ to

$(29)$

$9$ above. Journal narrations are not required.

Q$\mathrm{.}1\mathrm{.}3$ Prepare the property, plant and equipment note for Freedom$-$Co $($Pty$)$ Ltd for the

$(22)$

year ended $31$ December $2024$ as required by IAS$16-$ Property, plant and equipment.

Show all workings as marks will be allocated.

$24$

$2024$

Q$\mathrm{.}1\mathrm{.}4$ Prepare the statement of profit and loss and other comprehensive income for

$(19)$

Freedom$-$Co $($Pty$)$ Ltd for the year ended $31$ December $2024$ as required by IAS$1-$ Presentation of financial statements.

Show all workings as marks will be allocated.

Q$\mathrm{.}1\mathrm{.}5$ Prepare the statement of changes in equity for Freedom$-$Co $($Pty$)$ Ltd for the year

$(12)$

ended $31$ December $2024$ as required by IAS$1-$ Presentation of financial statements.

A total column is required.

Round all amounts to the nearest rand.

$[$TOTAL MARKS: $100]$