QUESTION 2 The following trial balance is available for Smash Plc as at 30 April 2019: Revenue Cost of sales Administration expenses Distribution costs Dividends paid Cork factory (cost 4,000,000) Dublin factory (cost 6,000,000) Plant and machinery (cost 10,000,000) Investments Trade receivables Trade payables Bank balance Retained profit at 1 May 2018 Ordinary shares Share premium 000 000 40,000 20,000 10,000 6,000 500 3,000 5,000 8,000 600 700 300 100 8,100 5,000 500 53,900 53,900 The following additional information is available: (1) Smash Plc has two manufacturing plants, one in Cork and one in Dublin. During 2018/19 a strategic decision was taken to close the Cork plant and it was closed on 31 January 2019. The following analysis is available concerning the Cork plant: Turnover Cost of sales Distribution costs Administration expenses 000 10,000 5,000 2,000 4,000 (2) As a result of the closure of the Cork factory, closure costs amounting to 900,000 were incurred. These costs were included in the Cork administration expenses in the above trial balance. (3) It was necessary to carry out a fundamental re-organisation of the Dublin factory which would change the nature and focus of Smash Plc's activities. Re-organisation expenses amounting to 700,000 were accruing at the year end. These expenses were not included in the trial balance. (4) The Cork factory was sold on 28 April 2019 for 5 million. The proceeds of sale were received on 1 May 2019. No transactions relating to the sale of the factory have been recorded in the trial balance. (5) On 30 April 2019, the Dublin factory was revalued to 8,000,000. This revaluation was not reflected in the trial balance. (6) Depreciation should be provided as follows: Dublin factory - depreciation charge for 2018/19 (based on re-valued amount) Cork factory - depreciation charge for 2018/19 Plant and machinery - depreciation charge for 2018/19 000 160 80 2,000 Depreciation on plant and machinery should be allocated as follows: Dublin plant and machinery 60%; Cork plant and machinery 40% (7) The company issued 500,000 1 shares at a premium of 1 per share during the year. Required: Prepare in a form suitable for publication under International Accounting Standards: (a) an income statement for Smash Plc for the year ended 30 April 2019 (7.5 marks) (b) the note to the income statement concerning the Cork plant (5 marks) (c) the statement of comprehensive income for the year ended 30 April 2019 (2 marks) (d) the statement of changes in equity for the year ended 30 April 2019 (5 marks) (e) a statement of financial position at 30 April 2019 (9.5 marks) QUESTION 2 The following trial balance is available for Smash Plc as at 30 April 2019: Revenue Cost of sales Administration expenses Distribution costs Dividends paid Cork factory (cost 4,000,000) Dublin factory (cost 6,000,000) Plant and machinery (cost 10,000,000) Investments Trade receivables Trade payables Bank balance Retained profit at 1 May 2018 Ordinary shares Share premium 000 000 40,000 20,000 10,000 6,000 500 3,000 5,000 8,000 600 700 300 100 8,100 5,000 500 53,900 53,900 The following additional information is available: (1) Smash Plc has two manufacturing plants, one in Cork and one in Dublin. During 2018/19 a strategic decision was taken to close the Cork plant and it was closed on 31 January 2019. The following analysis is available concerning the Cork plant: Turnover Cost of sales Distribution costs Administration expenses 000 10,000 5,000 2,000 4,000 (2) As a result of the closure of the Cork factory, closure costs amounting to 900,000 were incurred. These costs were included in the Cork administration expenses in the above trial balance. (3) It was necessary to carry out a fundamental re-organisation of the Dublin factory which would change the nature and focus of Smash Plc's activities. Re-organisation expenses amounting to 700,000 were accruing at the year end. These expenses were not included in the trial balance. (4) The Cork factory was sold on 28 April 2019 for 5 million. The proceeds of sale were received on 1 May 2019. No transactions relating to the sale of the factory have been recorded in the trial balance. (5) On 30 April 2019, the Dublin factory was revalued to 8,000,000. This revaluation was not reflected in the trial balance. (6) Depreciation should be provided as follows: Dublin factory - depreciation charge for 2018/19 (based on re-valued amount) Cork factory - depreciation charge for 2018/19 Plant and machinery - depreciation charge for 2018/19 000 160 80 2,000 Depreciation on plant and machinery should be allocated as follows: Dublin plant and machinery 60%; Cork plant and machinery 40% (7) The company issued 500,000 1 shares at a premium of 1 per share during the year. Required: Prepare in a form suitable for publication under International Accounting Standards: (a) an income statement for Smash Plc for the year ended 30 April 2019 (7.5 marks) (b) the note to the income statement concerning the Cork plant (5 marks) (c) the statement of comprehensive income for the year ended 30 April 2019 (2 marks) (d) the statement of changes in equity for the year ended 30 April 2019 (5 marks) (e) a statement of financial position at 30 April 2019 (9.5 marks)