The following trial balance is provided for Silver Stars Co Ltd for the year ending 31st December 2019

400,000 Ordinary shares of s. 10 @

4,000,000

300,000 10% Preference Share of Sh. 10 @

3,000,000

Share premiums

1,000,000

Retained Profits

2,400,000

Revaluation Reserve

1,200,000

15% Debentures

1,600,000

Land and buildings (cost)

5,480,000

Motor vehicles ( net as at 31st Dec 2013

7,200,000

Plant and machinery (net as at 31st Dec.2013)

1,440,000

Furniture (N.B.V)

600,000

Computers (N.B.V)

100,000

Stocks

1,080,000

Debtors and creditors

760,000

720,000

Bank balance

720,000

Cash balance

80,000

Gross profit for the year

6,740,000

Interim dividends: Preference

200,000

Ordinary

80,000

Provision for depreciation:

Administrative expenses

1,700,000

Selling and distribution cost

810,000

Finance cost

120,000

Investments

300,000

Provision for bad debts

4,000

  Investment income 6,000

                                                                                          20,670 20,670

Additional information

Sh. 200,000 to be transferred to general reserves

Proposed dividends; Preference dividends to be paid and a final dividend of 5% be made on Ordinary shares

Distribution expenses paid in advance amount tosh. 200 000 and accrued administration expenses amount tosh. 1,2 M Debentures were partly accruing for the year.

Sh. 20,000 were to be written off as bad debts and a provision of 2% be maintained

   Required:

Income statement and profit and loss and appropriation account for the year ended 31st December 2019.(5 Marks)