The following is the statement of financial position of TT and Co. at the end of its first year of trading:

Statement of financial position as at 31 December 2014

ASSETS	£
Non-current assets
Property, plant and equipment
Delivery van at cost	12,000
Depreciation	(2,500)
	9,500
Current assets
Inventories	65,000
Trade receivables	19,600
Prepaid expenses*	5,300
Cash	750
	90,650
Total assets	100,150
EQUITY AND LIABILITIES
Equity
Original	50,000
Retained earnings	26,900
	76,900
Current liabilities
Trade payables	22,000
Accrued expenses†	1,250
	23,250
Total equity and liabilities	100,150

* The prepaid expenses consisted of rates (£300) and rent (£5,000).

† The accrued expenses consisted of wages (£630) and electricity (£620).

During 2015, the following transactions took place:

1. The owners withdrew £20,000 of equity as cash.

2. Premises continued to be rented at an annual rental of £20,000. During the year, rent of £15,000 was paid to the owner of the premises.

3. Rates on the premises £1,300 were paid for the period 1 April 2015 to 31 March 2016.

4. A second delivery van was bought on 1 January 2015 for £13,000. This is expected to be used in the business for four years and then to be sold for £3,000.

5. Wages totalling £36,700 were paid during the year. At the end of the year, the business owed £860 of wages for the last week of the year.

6. Electricity bills for the first three quarters of the year and £620 for the last quarter of the previous year were paid totalling £1,820. after 31 December 2015, but before the financial statements had been finalised for the year, the bill for the last quarter arrived showing a charge of £690.

7. Inventories totalling £67,000 were bought on credit.

8. Inventories totalling £8,000 were bought for cash.

9. Sales revenue on credit totalled £179,000 (cost £89,000).

10. Cash sales revenue totalled £54,000 (cost £25,000).

11. Receipts from trade receivables totalled £178,000.

12. Payments to trade payables totalled £71,000.

13. Van running expenses paid totalled £16,200.

The business uses the straight-line method for depreciating non-current assets.

Required:

Prepare a statement of financial position as at 31 December 2015 and an income statement for the year to that date.