Question 3 (35 Marks) Ballistic Limited is a listed company on the Namibia Stock Exchange with a year-end of 31 July. The following balances were extracted from it's ledgers. Trial Balance as at 31 July 2021 Dr Cr N$'000 N$000 Share Capital 50,000 Share premium 25,000 Revaluation Surplus at 1 August 2020 10,000 Land and Building (Cost) 130,000 Building-Accumulated depreciation at 1 August 2020 22,500 Plant and equipment (Cost) 32,000 P&M Accumulated depreciation at 1 August 2020 18,000 Discount settlement received Discount settlement granted Trade and other receivables Trade and other payables 30 50 20,280 8,725 5% Borrowing: AB bank 20,000 Cash and Cash equivalents 2,213 Retained earnings at 1 August 2020 12,940 Sales 110,926 Purchases 67,231 Distribution costs 8,326 Administrative expenses 7,741 Inventories at 1 August 2020 7,280 Dividend paid 3,000 278,121 278,121 Adjustments: 1) The inventories at the close of business on 31 July 2021 cost N$9,420,000. 2) Depreciation is to be provided for the year to 31 July 2021 as follows: i. ii. Buildings 4% per annum on straight-line basis, all to be allocated to administrative expenses. Plant and equipment 20% per annum reducing balance basis to be apportioned as follows: Cost of sales: 70% Distribution costs: 20% Administrative expenses: 10% 3) Land, which is non-depreciable is included in the trial balance at a value of NS40 000 000 and it is to be revalued to N$54 000 000. This revaluation is to be included in the financial statements for the year ended 31 July 2021. 4) It has been decided to write off a debt of N$540 000 which will be charged to administrative expenses. 5) Included within distribution costs is N$2 160 000 relating to an advertising campaign that will run from 1 January 2021 to 31 December 2021. 6) The loan interest has not yet been accounted for. 7) The tax charge for the year has been calculated as N$2 700 000. REQUIRED: Marks 2.1 2.2 Statement of Profit or Loss and other comprehensive income for the year ended 31 July 2021 to comply with the requirement Companies Act 71 of 2008 and International Financial Reporting Standards (IFRS) using the function of expenses method. Comparative information is not required Prepare the notes to the financial statement for the year ending 31 July 2021 to comply with minimum requirements of companies Act 2008 and International Financial Reporting Standards with respect to: 17 i. Statement of compliance 18 ii. iii. Revenue Statement of significant accounting policies iv. Property, Plant and Equipment 2 of 8 TOTAL 35