The following information is taken from the accounting records of Starlight Supermarket Limited, a small local supermarket retailer, for the year ended 30th June 2021. Trial Balance Cr K Dr k 640,000 45,000 10,500 25,000 600 38,100 Purchases Admin expenses Bank overdraft Inventories at 1st July 2020 Trade receivables Retained earnings at 1st July 2020 Land (at cost) Buildings (at cost) Buildings - Accumulated depreciation Trade payables Sales revenue Called up share capital 290,000 220.000 430,000 21,000 720,000 1,000 1,220,600 1,220,600 Relevant Accounting Policies Depreciation is charged annually. if charged in the year of acquisition and no 1,220,600 1,220,600 Relevant Accounting Policies Depreciation is charged annually. A full year's depreciation is charged in the year of acquisition and no depreciation is charged in the year of disposal. Buildings have a useful economic life of 50 years with no residual value and depreciation is calculated on a straight-line basis. In addition, the following information is provided regarding matters which are not reflected in the above figures: i. At the year end, the supermarket needs to record a 7,400 tax expense which is required to be paid on 30th September 2021. PTO Page 2 of 9 ii. On 31st December 2020 Starlight Supermarket took out a new loan for 20,000 at an interest rate of 4% per year. The loan is repayable in full on 31st December 2025. No interest has yet been paid on this loan from cash. iii. Depreciation needs to be charged on the buildings for the full year. iv. The trade receivables balance reflects a customer who was also a local business and was offered credit from the supermarket. The local business is now in administration and so, the full amount is not considered to be SI recoverable. V. The closing inventory balance is 19,500 and costs of sales are calculated on a periodic basis. vi. An electricity bill for 3,000 has been paid out of cash and recorded as an expense. However, it has just been discovered that this expense relates to July to December 2022. Required: (a) On the first tab of the Excel template, detail the double-entry accounting adjustments required to address points (i) to (vi) above. You should explain your ntions made in determining them. Required: (a) On the first tab of the Excel template, detail the double-entry accounting adjustments required to address points (i) to (vi) above. You should explain your calculations, detailing any underlying assumptions made in determining them. (12 marks) (b) On the second tab of the Excel template, prepare the Extended Trial Balance, accommodating the changes required by the adjustments outlined in part (a). You are required to show the opening trial balance, the adjustments, and the revised figures. (8 marks) I (c) On the third and fourth tab of the Excel template, prepare the final Income Statement for the 12 months ending 30th June 2021 and the Balance Sheet as at 30th June 2021 for Starlight Supermarket Limited. (10 marks) (d) For adjustment (ili) above, relating to the deprecation charge required for buildings, explain how this is dealt with when producing Starlight Supermarket Limited's Cash Flow Statement for the 12 months ending 30th June 2021 and why such treatment is required. (4 marks) PTO ii. On 31st December 2020 Starlight Supermarket took out a new loan for 20,000 at an interest rate of 4% per year. The loan is repayable in full on 31s December 2025. No interest has yet been paid on this loan from cash. iii. Depreciation needs to be charged on the buildings for the full year. iv. The trade receivables balance reflects a customer who was also a local business and was offered credit from the supermarket. The local business is now in administration and so, the full amount is not considered to be 50 recoverable. V. The closing inventory balance is 19,500 and costs of sales are calculated on a periodic basis. vi. An electricity bill for 3,000 has been paid out of cash and recorded as an expense. However, it has just been discovered that this expense relates to July to December 2022. Required: (a) On the first tab of the Excel template, detail the double-entry accounting adjustments required to address points (i) to (vi) above. You should explain your ntions made in determining them. (e) Discuss how to account for the land and buildings if they were revalued at market value and explain why current accounting standards allow the choice of valuing fixed assets at either historical cost or market value. (6 marks)