Question 1

The following trial balance has been extracted from the accounting records of Basslet Ltd at 31 May 2021:

	Debit 000		Credit 000
1 equity shares (fully paid)			6,200
Retained earnings 1 June 2020			2,070
Freehold land and buildings (cost)	4,850
Plant and machinery (cost)	8,230
Motor vehicles (cost)	2,480
Accumulated depreciation at 1 June 2020:
Freehold buildings			225
Plant and machinery			2,500
Motor vehicles			1,300
Inventory at 1 June 2020	2,140
Sales			37,150
Purchases	24,260
Wages and salaries	3,340
Light and heat	350
Other administrative expenses	1,270
Receivables	3,260

5 NBS-7043B

Version 1

Payables			2,200
Allowance for doubtful receivables			115
Corporation tax paid	630
Bank	950
	51,760		51,760

6 NBS-7043B

Version 1

Notes

In addition, the following information is available:

Other administrative expenses includes payment of 24,000 made on a maintenance contract for the 12 months ended 30 November 2021.

The allowance for doubtful receivables required at 31 May 2021 is 200,000.

Inventory at 31st May 2021 was valued at 2,620,000

The corporation tax charge for the year is 1,000,000.

Freehold land originally cost 2,000,000. Depreciation is charged as follows:

Buildings	Straight line over 25 years
Plant and machinery	10% straight line
Motor vehicles	33% per annum reducing balance

Required:

Prepare the following financial statements for Basslet Ltd:

statement of financial position as at the 31 May 2021.

statement of profit or loss and other comprehensive income for the year ended 31 May 2021.

(25 Marks)