Question 9 Arnold plc and Bunny pic agreed to establish a Joint Operation Cartton, which started trading on laru. ary 20XI. Carlton is an unincorporated business, which is financed and managed by Arnold and Bunny Arnold agreed to provide and at an agreed price of 1.000.000 and plant at 600,000. In addition, Arnold and Bunny provided 200,000 in cash for working capital. It was agreed that, on consolidation, the land and plant would remain in the statement of francial position of Arnold. Al other assets and bites (except cash at the banks of the joint operation would be divided equally between the partners Cash at the bank would be divided so the capital of each partner was equal to their respective assets less liabilities. The trial balance of the Joint Operation at 31 December 20XI is given below. 2000 1500 Sales Purchases Direct wages Land Plant Trade receivables Trade payables Office expenses Heat, light & telephone Motor & travelling expenses Advertising & marketing Finance costs Capital - Amold Capital - Bunny Bank balance The value of inventory at 31 December 20XI was 200.000. No depreciation is to be charged on the land. Plant is to be depreciated at 5% per annum on cost Profit for the year is to be distributed to the partners 0 5% per annum on capital, then the remaining profit is to be divided equally between Arnold and Bunny Required: For the year ended 31 December 20X1. prepare an income statement and statement of financial position of the Joint Operation at the year-end