Sales revenue

1,210,000

Opening inventory

210,000

Purchases

800,000

Administrative Expenses

164,800

Distribution costs

114,000

Marketing expenses

28,000

Property, plant and equipment (PPE)

45,000

Accumulated depreciation onPPE

14,400

Vehicles

30,000

Accumulated depreciation on vehicles

7,500

Receivables

55,000

Allowance for receivables

3,000

Payables

67,000

Bank

11,100

Ordinary shares (1 nominal value)

50,000

Retained Earnings

90,000

6%, 10 year loan

20,000

Ordinary interim dividend - paid

4,000

Total

1461,900

1,461,900

NOTES

1)Closing inventory at 31 December 20X7 is 190,000

(2)Marketing expenses include a payment of 18,000for the period 1 December 20X7 to 28 February 20X8.

(3)Perfume Ltd's depreciation policy is as follows.

PPE is to be depreciated at 8% on a straight line basis.

Vehicles are to be depreciated at 25% on a reducing balance basis.

No depreciation has been charged for the year ended 31 December 20X7.

(4)Irrecoverable receivables to be written off amount to 8,000.

(5)The allowance for receivables is to be set at 10% of receivables at the financial year end.

(6)The audit fee for the year ended 31 December 20X7 is estimated to be 5,000. This has not been included in the trial balance or paid at the year end.

(7)During the year, the company estimates that the costs in relation to a warranty on its products are likely to be around 9,000.50% of the warranty costs will be paid in20X8 and 50% in 20x9.Warranty costs have not been included in the trial balance.

(8)irrecoverable receivables, depreciation on PPE, the audit fee, warranty costs and marketing expenses are to be recorded under administrative expenses.Depreciation on vehicles is to be recorded under distribution costs.

(9)The loan is repayable in ten years' time. Interest of 6% has not yet been recorded. The loan interest has not been paid at the year end.

(10)The corporation tax rate for the year ended 31 December 20X7 is 20%.

REQUIRED:

(a) Prepare a statement of financial performance for Bassett Limited for the year ended 28 February 2018. (15 marks)

(b) Prepare a statement of financial position for Bassett Limited, as at 28 February 2018