Rho Plc
 Date: 30 September 2023

Trial Balance:

Description	Dr (£000)	Cr (£000)
Bank overdraft		110
Called-up share capital (ordinary shares of £1 each)		3,100
Accounts payable		140
Accounts receivable	120
Non-current assets: at cost	480
Accumulated depreciation (at 1 October 2022)		300
Marketing expenses	280
Office expenses	310
Retained profits (at 1 October 2022)		380
Production expenses	4,000
Purchases (net of VAT)	5,400
Sales (amounts invoiced, net of VAT)		10,800
Inventory (at 1 October 2022)	300
Trade accounts payable		330
Trade accounts receivable	4,100
Total	10,620	10,620

Additional Information:

1. Inventory at 30 September 2023 was valued at £340,000.
2. At 30 September 2023, £105,000 was owing for office expenses, and £95,000 had been paid in advance for marketing expenses.
3. A customer had gone into liquidation owing the company £470,000; the company does not expect to recover any of this debt.
4. The company decides to set up an allowance for doubtful debts amounting to 5% of the outstanding trade accounts receivable as at the end of each financial year.
5. Depreciation is to be charged on the non-current assets at a rate of 20% on cost; it is to be apportioned as follows:
   • Marketing: 25%
   • Office: 25%
   • Production: 50%

Note:
 There were no acquisitions or disposals of non-current assets during the year to 30 September 2023.

Required:
 Prepare Rho Plc’s income statement for the year ending 30 September 2023, and a balance sheet as at that date.