Xi Ltd
 Date: 30 September 2023

Details:

• Raw materials inventory (cotton):
  • Cost: £44,000
  • Replacement cost: £42,000
• Finished goods inventory:

Product	Nu	Xi
Direct costs	£90,000	£75,000
Proportion of fixed overhead	£20,000	£18,000
Proportion of selling costs	£5,000	£4,500
Net realizable value	£135,000	£105,000

• Office machinery:
   Acquired on 1 October 2018 for £260,000, depreciated over 10 years using the reducing balance method.
• Freehold property:
   Acquired 20 years ago for £3,100,000, land value estimated at £700,000. Buildings are depreciated over 55 years.
• Research and development:
  • Research costs: £250,000
  • Development costs: £350,000, benefiting over 7 years.

Required:
 Prepare the necessary financial statement adjustments for Xi Ltd as of 30 September 2023.