1. The following is a list of the assets and claims of Beta Manufacturing as at 31 December last year:
   • Trade payables: £85,000
   • Motor vehicles: £39,000
   • Long-term borrowing (loan from Manufacturing Finance Co.): £265,000
   • Equipment and tools: £225,000
   • Short-term borrowings: £115,000
   • Inventories: £150,000
   • Property: £340,000
   • Trade receivables: £180,000

Required:

(a) Prepare the statement of financial position of the business as at 31 December last year from the information provided, using the standard layout. (Hint: There is a missing item that needs to be deduced and inserted.)

(b) Evaluate the profitability prospects revealed by this financial statement.