Toby and Talea McKellar are the joint owners of Beaut Beach Caravan Park, which is near a swimming beach popular during the summer months. The park provides not only camping facilities for caravans and tents but also up-market cabins with kitchenettes and ensuites. For the year ended 30 June 2019, Toby and Talea determined the following financial information for their business.

A real estate agent valued the buildings at $500 000 on 30 June 2019.
Required

(a) Prepare an income statement for Beaut Beach Caravan Park for the year ended 30 June 2019.

(b) Prepare a balance sheet for the business as at 30 June 2019.

(c) Explain why you have used a particular valuation for the buildings in the balance sheet.

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Cash on hand Buildings purchased $ 20000 420 000 272 000 Income - cabins Salaries and wages 220 000 Supplies used 71 000 Other equipment purchased 63 000 Accounts payable Accounts receivable Income camping Supplies on hand Other expenses $ 87000 8000 185000 15000 45000