QUESTION $1$The following trial balance has been prepared for Vale Ltd as at $31$ December $2023.$ Except where stated, the additional information has not been accounted for in the trial balance.Notes$$Sales$13,083,000$Purchases$7,084,100$Staff wages and salaries$(2)3,913,800$Distribution costs$824,600$Interest paid on a bank overdraft$2,320$Inventories at $31$ December $2022518,200$Trade receivables$2,663,400$Allowance for receivables at $31$ December $2022(3)173,700$Land and buildings$(4)$ Cost $($land at $3,250,000)5,250,000$ Accumulated depreciation at $31$ December $2022560,000$Plant and equipment$(4)$ Cost$2,100,000$ Accumulated depreciation at $31$ December $20221,450,000$Retained earnings at $31$ December $20222,658,020$Ordinary share capital $(0\mathrm{.}25$ shares$)(5)2,000,000$Share premium$500,000$Trade payables$1,467,700$Financial liability $(4\%1$ preference shares$)(5)400,000$Bank $64,00022,356,42022,356,420$ Additional information$(1)$Vale Ltd uses the average cost method to value inventories. On $31$ December $2023,$ Vale Ltd had the following inventories:ProductInventoriesIn unitsAverage cost per unit$$CL$122,5009\mathrm{.}90$JP$143,2008\mathrm{.}00$Included within the total inventories of JP$1$ are $1,000$ units which are damaged and which can only be sold for $1.(2)$Staff wages and salaries should be allocated $60\%$ to cost of sales and $40\%$ to administrative expenses.$(3)$The allowance for receivables at $31$ December $2023$ should be $204,300.$ This figure has been correctly calculated but the change in the allowance for receivables has not yet been recorded. Changes in the allowance for receivables should be presented in administrative expenses.$(4)$No accounting entries have been made for depreciation for the year ended $31$ December $2023.$ Buildings are depreciated over a useful life of $25$ years using the straight line method with a residual value of zero. Depreciation on buildings should be presented in administrative expenses. Depreciation on plant and equipment is calculated using a reducing balance of $25\%.$ Depreciation on plant and equipment should be presented in cost of sales.$(5)$During the year, Vale Ltd issued the following shares:Ordinary shares: on $21$ December $2023,$ Vale Ltd issued $800,000$ new $0\mathrm{.}25$ ordinary shares for cash at a market value of $0\mathrm{.}30$ per share. No accounting entries have been made for this transaction.Preference shares: on $1$ January $2023,$ Vale Ltd issued $400,000$ of $14\%$ redeemable preference shares which are measured at amortised cost. The preference shares were issued at par for cash proceeds of $400,000.$ The effective interest rate is $5\mathrm{.}6\%.$ Vale Ltd paid the $4\%$ coupon on $31$ December $2023.$ Cash proceeds were correctly debited to bank and credited to financial liabilities. No accounting entries have been made to record the interest charged or the coupon payment.Note: the trial balance of Vale Ltd currently shows bank as a credit balance which indicates use of a bank overdraft.$(6)$Tax for the year has been estimated at $240,000.$REQUIRED:Prepare for Vale Ltd$,$ a statement of profit or loss for the year ended $31$ December $2023$ and a statement of financial position at that date.