Required tasks A,B and C as given in the attachment
QUESTION ONE (40 marks) Ketering Pc, a trading company, was noorporated on 1 Janary 2016 The following information is avaliable for the financiel year to 31 December 2016: L. 3 milion E1 ordinary shares were issued at per on January 1st Dwidends of 6p per share were paid on these shanes during the year 2 1.140.000 4% preference shares of 1 C45600 were paid on these shares during the year each were isand Donds or R A long-erm loan of 1400 000 was taken by the company on Mach 31. a.6% mere nee wth 3% to be paid at he end of each six orth perod, the frst payment being made on Segtember 30th The compeny recelived (20,000 nerst on its cash balances during the 5 Sales for the yeer are equal to 10,000.000 & Administrative expenses paid during the year were E1650.000 Adminsraive expenses owing 31 Dcember 2016 amounted to 7 Wages pad during the year are equal to 8750,000 of which wages paid Equipment wan purchased for cash during the year jon 31 Match 2016) 265,000 n advance amounted to t30 000 at a cost of E3600,000expected to last 10 years and to have salvage value at the end of its ife of 1,000,000 Depreciation charged pro rata to the proporson of the year the eqapmert was in use 9 Corporation tax is charged at 20% Aume that depreciation is a 0 Trade payecles 31 December 2016, relaing to purchases of I1. Trade receivables at 31 December 2016 are equal to E2.250000 deductible. No tax was paid during the year nventory, are' equa to 900,000 However, one of these detors which owes 90,000has gone bankupt 12 Inventory purchases for the year are equal to 5.100.000 Inventory a 31 Decerber 2016 valued at cos amourted to 900.000 On 31 December 2016, se copany made rtart czu for 1: and (b) offered rights issue of2or 3 030 per ondinary share These are to take effect immediately (Nole that both the share split and rights issue do not canry any right of didend in 2016 Required a Prepare an Income Statement for Kettering Plc for he year to 31 December 2016 Work in E000, ounding where necessany (12 marks) b. Propare a Balance Shoet (also known an the Statement of Financial Postionjforthe yeer to 31 December 2016 Show your workings cea ncluding far the cash balance, which should be fuity calculaled and nat ust the baiancing Eem on the Balance Sheet, and changes in the capital structure, and presert a "clean copy of ne requested two documerts If you make any assumptions explain them bretly 20 marks) e What are the demerts and merts off righs issue of shares TOTAL: 0 MARKS QUESTION ONE (40 marks) Ketering Pc, a trading company, was noorporated on 1 Janary 2016 The following information is avaliable for the financiel year to 31 December 2016: L. 3 milion E1 ordinary shares were issued at per on January 1st Dwidends of 6p per share were paid on these shanes during the year 2 1.140.000 4% preference shares of 1 C45600 were paid on these shares during the year each were isand Donds or R A long-erm loan of 1400 000 was taken by the company on Mach 31. a.6% mere nee wth 3% to be paid at he end of each six orth perod, the frst payment being made on Segtember 30th The compeny recelived (20,000 nerst on its cash balances during the 5 Sales for the yeer are equal to 10,000.000 & Administrative expenses paid during the year were E1650.000 Adminsraive expenses owing 31 Dcember 2016 amounted to 7 Wages pad during the year are equal to 8750,000 of which wages paid Equipment wan purchased for cash during the year jon 31 Match 2016) 265,000 n advance amounted to t30 000 at a cost of E3600,000expected to last 10 years and to have salvage value at the end of its ife of 1,000,000 Depreciation charged pro rata to the proporson of the year the eqapmert was in use 9 Corporation tax is charged at 20% Aume that depreciation is a 0 Trade payecles 31 December 2016, relaing to purchases of I1. Trade receivables at 31 December 2016 are equal to E2.250000 deductible. No tax was paid during the year nventory, are' equa to 900,000 However, one of these detors which owes 90,000has gone bankupt 12 Inventory purchases for the year are equal to 5.100.000 Inventory a 31 Decerber 2016 valued at cos amourted to 900.000 On 31 December 2016, se copany made rtart czu for 1: and (b) offered rights issue of2or 3 030 per ondinary share These are to take effect immediately (Nole that both the share split and rights issue do not canry any right of didend in 2016 Required a Prepare an Income Statement for Kettering Plc for he year to 31 December 2016 Work in E000, ounding where necessany (12 marks) b. Propare a Balance Shoet (also known an the Statement of Financial Postionjforthe yeer to 31 December 2016 Show your workings cea ncluding far the cash balance, which should be fuity calculaled and nat ust the baiancing Eem on the Balance Sheet, and changes in the capital structure, and presert a "clean copy of ne requested two documerts If you make any assumptions explain them bretly 20 marks) e What are the demerts and merts off righs issue of shares TOTAL: 0 MARKS
