Question
Sejahtera Bhd has an authorized share capital of RM2,000,000 divided into 3,000,000 equity shares of 50cents and 500,000 12% redeemable preference shares of RM1. The
Sejahtera Bhd has an authorized share capital of RM2,000,000 divided into 3,000,000 equity shares of 50cents and 500,000 12% redeemable preference shares of RM1.
The following trial balance has been extracted from accounting records at 30 June 2020.
| Debit RM000 | Credit RM000 |
50cents equity shares (paid) |
| 500 |
12% RM1 preference shares (paid) |
| 200 |
8% debentures |
| 400 |
Retained earnings 1 July 2019 |
| 368 |
Freehold land and buildings (cost) | 860 |
|
Plant and machinery (cost) | 1,460 |
|
Motor vehicle (cost) | 440 |
|
Accumulated depreciation at 1 July 2019 |
|
|
Freehold buildings |
| 40 |
Plant and machinery |
| 444 |
Motor vehicles |
| 230 |
Inventory at 1 July 2019 | 380 |
|
Sales |
| 6,590 |
Purchases | 4,304 |
|
Final dividends for year end 30 June 2019: |
|
|
Equity | 40 |
|
Interim dividends for the year end 30 June 2020 |
|
|
Preference | 12 |
|
Equity | 16 |
|
Debenture interest | 16 |
|
Wages and salaries | 508 |
|
Light and heat | 62 |
|
Irrecoverable debt expense | 30 |
|
Other administration expenses | 196 |
|
Receivables | 578 |
|
Payables |
| 390 |
Allowance for receivables |
| 20 |
Corporation tax paid | 112 |
|
Bank | 168 |
|
| RM9,182 | RM9,182 |
The following information needs to be dealt with before the financial statements can be completed:
- Inventories at 30 June 2020 were valued at cost RM440,000
- Other administration expenses include RM18,000 paid in respect of a machinery maintenance contract for the 12 months ending 30 November 2020. Light and heat does not include an invoice of RM12,000 for electricity for the quarter ending 3 July 2020, which was paid in August 2020.
- The directors wish to provide for:
- any debenture interest due
- directors; bonuses of RM24,000
- the years depreciation
- The allowance for receivables required at 30 June 2020 is RM24,000
- During the year ended 30 June 2020, a customer whose receivables balance of RM8,000 had been written off in previous years as irrecoverable paid the full amount owing. The company credited this amount to receivables
- The debentures have been in issue for some years
- Corporation tax of RM256,000 is to be charged on the profits
- During the year a piece of machinery, which had originally cost RM320,000 and had been owned by the company for 6 years, was scrapped. Proceeds received were RM40,000. These have been incorrectly credited to the plant and machinery cost account.
- The buildings element of the freehold land and buildings cost is RM400,000.
Depreciation methods and rates are as follows:
Building Straight-line over 50 years
Plant and machinery 10% straight-line
Motor vehicle 33% reducing balance
Required:
Prepare the financial statements for Sejahtera Bhd for the year ended 30 June 2020 according to the Principles set out under IAS 1. Your statements should include:
- Statement of Comprehensive income for the year ended
- Statements of Financial Position for the year ended
- Statement of changes in equity for the year ended
- Note to financial Statement:
- Property, Plant and Equipment
- Revaluation of non-current assets
- Expense by functions
- Receivables and Payables
- Finance Cost
Note: Financial statements for publication should be prepared in accordance with IAS 1 Presentation of Financial Statements.
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