Question 1 The following transactions were selected form the accounting records of State plc as at 31 December 2018 P Stock 1 January 2018 140,000 Sales 1,860,000 Purchases 1,140,000 Carriage inwards 8,000 Returns inwards 9,000 Returns outwards 5,000 Discounts allowed 11,000 Discounts received 14,000 Wages (putting goods into saleable condition) 88,000 Salaries and wages: Sales and distribution staff 62,000 Salaries and wages: Administrative staff 74,000 Motor expenses (see Note (c)) 24,000 Rent and business rates (see Note (d )) 28,000 Investments in undertakings in which the company has a participating interest (market value P74,000) 100,000 Income from shares in undertakings in which the company has a participating interest 5,000 General distribution expenses 12,000 General administrative expenses 6,000 Bad debts 2,000 Interest from government securities 3,000 Haulage costs: Distribution 4,000 Debenture interest payable 2,000 Profit and loss account: 31 December 2017 94,000 Motor vehicles at cost: Distribution and sales 60,000 Administrative 26,000 Plant and machinery at cost: Distribution and sales 50,000 Administrative 30,000 Production 60,000 Directors remuneration 36,000 Dividends paid 60,000

Additional Notes: (a) The production department puts goods bought into a saleable condition. (b) Stock at 31 December 2018 P160,000. (c) Apportion motor expenses: distribution 3/4, administrative 1/4. (d ) Apportion rent and business rates: distribution 40 per cent, administrative 60 per cent. (e) Write P26,000 off the value of investments in undertakings in which the company has a participating interest. (f ) Depreciate motor vehicles 25 per cent on cost, plant and machinery 15 per cent on cost. (g) Accrue auditors remuneration P14,000. (h) Accrue corporation tax on ordinary activity profits P104,000. (i ) A sum of P25,000 is to be transferred to debenture redemption reserve.

Required: : From the above selected balances of State plc as at 31 December 2018: (a). Prepare a detailed statement of comprehensive income for the year ended 31 December 2018 for internal use. (20 Marks) (b). Prepare a detailed statement of Changes in equity for the year ended 31 December 2018. (5 marks)

Question 1 The following transactions were selected form the accounting records of State plc as at 31 December 2018 P Stock 1 January 2018 140,000 Sales 1,860,000 Purchases 1,140,000 Carriage inwards 8,000 Returns inwards 9,000 Returns outwards 5,000 Discounts allowed 11,000 Discounts received 14,000 Wages (putting goods into saleable condition) 88,000 Salaries and wages: Sales and distribution staff 62,000 Salaries and wages: Administrative staff 74,000 Motor expenses (see Note (c)) 24,000 Rent and business rates (see Note (d )) 28,000 Investments in undertakings in which the company has a participating interest (market value P74,000) 100,000 Income from shares in undertakings in which the company has a participating interest 5,000 General distribution expenses 12,000 General administrative expenses 6,000 Bad debts 2,000 Interest from government securities 3,000 Haulage costs: Distribution 4,000 Debenture interest payable 2,000 Profit and loss account: 31 December 2017 94,000 Motor vehicles at cost: Distribution and sales 60,000 Administrative 26,000 Plant and machinery at cost: Distribution and sales 50,000 Administrative 30,000 Production 60,000 Directors remuneration 36,000 Dividends paid 60,000

Additional Notes: (a) The production department puts goods bought into a saleable condition. (b) Stock at 31 December 2018 P160,000. (c) Apportion motor expenses: distribution 3/4, administrative 1/4. (d ) Apportion rent and business rates: distribution 40 per cent, administrative 60 per cent. (e) Write P26,000 off the value of investments in undertakings in which the company has a participating interest. (f ) Depreciate motor vehicles 25 per cent on cost, plant and machinery 15 per cent on cost. (g) Accrue auditors remuneration P14,000. (h) Accrue corporation tax on ordinary activity profits P104,000. (i ) A sum of P25,000 is to be transferred to debenture redemption reserve.

Required: : From the above selected balances of State plc as at 31 December 2018: (a). Prepare a detailed statement of comprehensive income for the year ended 31 December 2018 for internal use. (20 Marks) (b). Prepare a detailed statement of Changes in equity for the year ended 31 December 2018. (5 marks)