Question 2 The information below is based on the 2017 annual report of Excellent Trades LTD. Equipment Inventory Accounts receivable Cash Balance sheet as at 31-12-2013 () 416,000 Share capital 21,600 Reserves 22,800 4% long term bank loan 2,400 462,800 144,000 176,000 142,800 462,800 During the year 2018 the following events take place: Total receipts from customer transactions are 1,120,000. At the end of 2018 the outstanding receivables are 16,800, including 1,600 owed by a customer, who has filed for bankruptcy. The management of Excellent Trades LTD has serious doubts about ever receiving this money. Total purchases are 785,600. On 31 December 2018 the inventory is 24,800. All purchases are paid in cash. At the end of the year the company repays 40,000 on the long-term bank loan as well as the interest costs. Depreciation on equipment is 43,000 a year. Other operating costs are 104,000. All operating costs are paid in cash. Income tax is 20% of net profit and will be paid in 2019. The company paid out 120,000 in dividends a. Calculate the amount of interest that is paid at the end of 2018. b. Prepare the profit and loss account for 2018 C. Draw up the balance sheet as at 31-12-2018