QUESTION 3 Kele Ltd is a private company. Three quarters of the stated capital is held by the directors or members of their families. The company's draft Statement of Financial Position as at the end of 2020 was as follows: Statement of Financial Position at 31 December 2020 Non-Current assets Intangible assets: Development costs GH Non Current Asset Goodwill GHO Tangible assets: Land and buildings Plant and machinery Current Assets Development cast Land Building Plant Machay 85,000 85,000 320,00 60,000 125000 270,000 -326,000 Inventories Current Assels Receivables Total Assets Inventory 210,000 PRONEL 426,000 500,000 531.000 Cash Equity and liabilities 233 1698,000 Equity 1473,000 Capital Surplus Stated capital (800,000 share of GHe leach) EXL Retained loss State Capital 469000 800,000 50,000 Current liabilities Non cent (232,000) Payables 4050 600,000 Bank loans and overdraft Total Equity plus Liability Current Art Payables 393000 393,000 687,000 1,473,000. 1,698,000) Additional information: 1. Bank loans and overdrafts consist of a 10% loan of GHe400,000 repayable in 2022 and an unsecured overdraft of GHe287,000. 2. The demand for the company's products fell drastically in recent years owing to the import of high quality and cheaper products from Togo. The development costs appearing in the Statement of financial Position above relate to a new product which has been perfected to a marketable stage, however there is no believe that there will be demand for the product in future. 3. The company is in urgent need of capital to meet existing liabilities and the necessary new investment in plant and working capital. A scheme for financial reorganization has been drawn up and the terms are as follows: i) The share of GH1.00 each are to be written down to GH0.20 per share and subsequently (every five shares of GH0.20 each) are to be consolidated into one fully paid share of GH1.00.