Question 3 (20 Marks) Prepare the Statement of Comprehensive Income for the year ended 28 February 2022. INFORMATION The trial balance, additional information and adjustments given below were extracted from the records of Metro Limited for the financial year ended 28 February 2022 METRO LIMITED PRE-ADJUSTMENT TRIAL BALANCE AS AT 28 FEBRUARY 2022 Debit (R) Credit (R) Balance sheet accounts section Ordinary share capital 2 200 000 Retained earnings 608 000 Land and buildings at cost 2 300 000 Equipment at cost 1 060 000 Vehicles at cost 880 000 Accumulated depreciation on equipment 440 000 Accumulated depreciation on vehicles 220 000 Trading inventory 210 000 Debtors control 265 000 Provision for bad debts 15 000 Bank overdraft 70 000 Creditors control 325 000 Loan: Ria Bank (18% p.a.) 250 000 South African Revenue Services (Company tax) 130 000 Nominal accounts section Sales 4 580 000 Cost of sales 1 980 000 Sales returns 130 000 Advertising 140 000 Stationery 50 000 Bad debts 15 000 Discount allowed 20 000 Discount received 16 000 Electricity and water 180 000 Telephone 90 000 Interest on overdraft 1 000 Directors' fees 240 000 Audit fees 60 000 Insurance 32 000 Salaries 950 000 Bank charges 13 000 Rent income 112 000 Municipal rates 90 000 8 836 000 8 836 000 ADDITIONAL INFORMATION AND ADJUSTMENTS According to physical stocktaking, the following were on hand on 28 February 2022: 1. 1.1 Trading inventory R200 000 1.2 Stationery R3 000 2 Advertising includes a payment of R6 000 for six advertisements at R1 000 each that will be published monthly from January 2022 and June 2022. 3. Part of the building has been letto a tenant since 01 March 2020. Rent has been received up to 31 January 2022. Note: The rental increased by 10% on 01 December 2021. 4. On 28 February 2022 an amount of R1 200 was received from a debtor who was only able to pay 60% of his debt. The balance of his account must be written off. No entries were made for these transactions. 5. The provision for bad debts must be increased to R18 000. 6. Directors fees amount to R21 000 per month. Make the necessary adjustment 7. The loan from Ria Bank was obtained on 01 February 2022. Provide for the outstanding interest on loan 8. A notice from the municipality indicated that the municipal rates for the year ended 28 February 2022 was calculated at R50 per R1 000 of the value of the land and buildings. Make the necessary adjustment. 9. 9 Provide for depreciation as follows: 9.1 On vehicles at 20% per year using the diminishing balance method. 9.2 On equipment, R106 000 10. Based on the taxable income of the company, an amount of R6 114 is owed by the tax authority (South African Revenue Services) to Metro Limited for company tax