Question
The Trial balance of BJ Ltd as at 31 December 2021 was as follows: Turnover is 850000, Purchases is 450000, 80000 is Inventory at 1
The Trial balance of BJ Ltd as at 31 December 2021 was as follows:
Turnover is 850000, Purchases is 450000, 80000 is Inventory at 1 January 2021, 80000 is Distribution costs,
Administration expenses is 105000, Returns inwards is 5000, Receivables is 150000, Payables is 32000,Returns outwards is 3000,Carriage inwards is 10000, Cash at bank is 85000,Carriage outwards is 2000,Ordinary shares 50 ngwee per share is 100000, 10% redeemable preference shares K1 is 90000, 10% loan notes is 80000,Non-current assets at cost is 368000, Accumulated depreciation 1 January, 2021 is 140000, Share premium is 30000, Retained profits at 1 January, 2021 is 30000,Loan note Interest is 4000,Interim preference dividend is 6000,Interim ordinary dividend is 10000 and total debit is 1355000 and total credit is 1355000.
The following is to be taken into account.
i) The depreciation is charged on non-current assets at the rate of 20% on a reducing balance basis per year. Depreciation is charged to the administrative expenses. Corporate tax payable is at the rate of 30% per year.
ii) Rent paid in advance amounting to K5, 000 was charged to administrative expenses.
iii) There is an outstanding transport cost amounting to K4, 000. Transport costs are charged to the distribution costs.
iv) Final ordinary dividend of 20 ngwee per share is proposed.
v) Closing inventory is K40, 000.
Required:
a) Prepare the statement of profit or loss and other comprehensive income for the year ended 31st December 2021.
b) Prepare the statement of Financial Position as at 31st December, 2021.
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