Stone Ltd
Trial balance at 31 December 2021
Sales				2,792,000
Inventory at 1 January 2021		293,600
Purchases		996,000
Administrative expenses		238,600
Distribution costs		167,360
Salaries		341,000
Advertising expenses		60,000
Energy costs		12,240
Equipment - cost		1,124,000
Equipment - accumulated depreciation				184,000
Vehicles - cost		212,000
Vehicles - accumulated depreciation				116,800
Non-current investments		20,800
Receivables		310,400
Allowance for receivables				10,400
Payables				241,920
Bank		256,960
Ordinary shares (nominal value 50p)				443,000
Ordinary share premium				25,800
Retained earnings at 1 January 2021				168,640
6% debetures				60,800
Interim ordinary dividend paid		10,400
Total		Total 4,043,360		Total 4,043,360

The following information is relevant:

1. Closing inventory at 31 December 2021 is 300,000.
2. Stone Ltd depreciates non-current assets as follows:
   • Equipment at 30% per annum on a straight line basis
   • Vehicles at 15% per annum on a reducing balance basis.
3. On 31 December 2021, Stone Ltd decided to write off receivables of 4,400 and to make an allowance for irrecoverable receivables of 5% of net receivables at that date. No entries have been made in the accounting records.
4. A full year's interest on the debentures is to be accrued.
5. Energy costs have been paid up to 30 November 2021. The next invoice covering the period 1December2021 to 31 January 2022 is expected to be 4,200.
6. 60% of the advertising expenses in the trial balance related to 2021.
7. For the financial year ended 31 December 2021, the corporation tax rate is 20% and the audit fee is estimated to be 6,400.
8. On the last day of the period, Stone Ltd issues 50,000, 50p nominal value ordinary shares for 2.50 each. This transaction is not accounted for by the company.
9. Stone Ltd allocates expenses as follows:
   • Depreciation on vehicles is allocated to distribution costs.
   • Salaries are allocated 75% to administrative expenses and 25% to distribution costs.
   • All other expenses are allocated to administrative expenses.

Required

• a.Prepare a statement of financial performance for Stone Ltd for the year ended 31December2021.
• b.Prepare a statement of changes in equity for Stone Ltd for the year ended 31 December 2021.
• c.Prepare a statement of financial position for Stone Ltd as at 31 December 2021.