QUESTION 4 (Accounting Policies, Changes in Accounting Policies and Emers: LAS 3) (20 marks) Good lining Lad has the following abridged Trial balances for the years ended 30 June 2018 and 2019 2018 NS 20 000) 7000 2000 Gross profit Retained carnings beginning of the year Share capital Profit on disposal of land Dividends paid Income tax expense Net current assets Other expenses Machinery at cost Machinery accumulated depreciation Depreciation (Sraight-line 20% per annum) stationery NS (30000) 10 RRO 2000 2000 1 OO 3120 SOCO 16 000 18000 11 200 3200 3000 1 000 1920 1200 10 000 18000 8000 3200 Additional information Note 1 The stationery expense of N53 000 relating to 2018 was paid in 2019 and arose in 2018 only after the company's auditors found an underpayment of stationery expenses relating to 2018. The expense was never recorded in 2018. The amount is said to be material for Good Living company Note 2 The board of directors of Good Living Lid re-estimated the residual value of the machinery to be NSI 400. The original value was NS2000. No machinery was purchased or disposed since 2017 Note 3 The share capital of Good Living has remained constant for some time and the Directors of Good Living are thinking of financing construction of a manufacturing plant starting June 2020. Note 4 Ignore tax implications of the above items and maintain taxation as given above. Page 19 of 20 Note 5 The following figures are also provided, Revenue (2018, NS40 000: 2019, NS 6 000 Gross prodit on sales percent has been constant for both 2018 and 2019 @ 50% Required 4.1 Prepare the Statement of Profit or Loss and other comprehensive income for 3 year ended 30 June 2019 in accordance with the requirements of IFRS 4.2 Prepare the Statement of changes in equity showing the retained carnings 5 only Notes to the financial Matements relating to the change in accounting 7 estimates and prior periodo Total 43 20 36% 11 MTC LTE 8:44 PM