QUESTION 3 (20 MARKS) Seri Meranti Sdn Bhd is a company that supplies safety equipment product. Table 4 shows statements in the company's account. Table 4: Statements in the Seri Meranti Sdn Bhd's account Statements RM Stock (1 January 2019) 12,000 Stock (31 December 2019) 16,000 Capital 263,756 Bank 50,000 Purchase 80,000 Sales 800,800 General expenses 4,000 Commission received 5,000 Machineries 520,000 Vehicle 164,000 Creditors 223,120 Wages And Salaries 42,900 Long term loan 280,000 Debtors 40,000 Overdraft (short term loan) 240,000 Other relevant supplementary information are as follows: Depreciation for machineries is 10% every year. Depreciation allocation for machineries for last year was RM 104,000. Total tax to be paid is 10%. The board of director agreed to distribute 60% dividend to the shareholders for the financial year ending 31 December 2019. a) Based on the data in Table 4, construct the income statement and balance sheet as at 31 December 2019. (13 marks) b) Evaluate the company's ability to pay current liabilities. If the company plan to increase production by applying some loan, determine whether the company has the capability to pay the current loan. Justify your answer with the normal situation and for a short term situation (4 marks) c) It is found that there are some statements are not stated in the account: Stakeholder add cash in bank RM 10,000 as an additional capital. Company paid cash in bank RM 4,000 for office equipment. (ii) Company purchased extra office equipment RM 2,000 by loan from creditors. Determine the change of the balance sheet by showing the amount reduced or increased at the suitable place after considering the statements above