Tanka Ltd, an engineering company, which engages in manufacturing and selling of production equipment, made up its financial statements to 31 March 20X5. The financial statement was authorised to be issued on 1 June 20X5. Subsequent to the reporting date, and before the financial statements were approved for issue, the following material events have taken place:

(a) When drafting the financial statements, the accountant included a figure of $2m as part of stock balance in the financial position statement of which represents the net realizable value of certain damaged items of inventory. The cost of these items was $3m. During April 20X5, these items are sold for $3.1m.

(b) A fire occurred at a company warehouse on 30 April 20X5 and all the companys stock up to the value of $5 million was destroyed. It was subsequently found that the stock in the warehouse was underinsured by around 50 per cent.

(c) On 31 March 20X5 a provision had been made of $600,000 in respect of any remedial work required on a production line supplied and installed at a customers production plant during the year. The customer confirmed on 1 May 20X5 that the production line is to be accepted with no follow up work to be required; accordingly, no further liability would be involved.

(d) Confirmed by the liquidator that a debtor will only be able to pay 30% of his debt. At the reporting date, he owed $900,000 and since then we have supplied him with goods to the value of $85,000.

(e) A final dividend of 20 cents per share was proposed and declared by the board of directors on 30 April 20X5.

(f) Tanka Ltd has disclosed a contingent liability representing an outstanding legal case in which the company was being sued for breach of contracts and the amount being claimed was $2.5m. Legal opinion at that time was in favor of Tanka Ltd. However, during a meeting held with the solicitors in May 20X5, the management of Tanka Ltd was advised that the company did not have a strong case in view of recent development of certain events.

(g) On 31 May 20X5, Tanka Ltd made a public announcement that as part of the companys business restructuring, their operations in Indonesia would be closed and there would be redundancies for the staff concerned. Further, it announced that all assets involved, including the manufacturing plants and facilities, would be sold to interested parties. The company also made it public that total cost incurred for this closure of operation was estimated to be around $1.5m.

Required:

.(ii) Prepare either the accounting adjustments for adjusting events or the notes to financial statements for non-adjusting events.