On completion of his first year of business as a dealer in fashion-wear, Bernard prepared his financial statements as shown on the right. The only mistake he has made is that he has failed to take into account the unsold fashion-wear costing £112,000 remaining in hand on 31 December 2010.

Required: 

Re-draft his financial statements correctly.

Transcribed Image Text:

Statement of income year ended 31.12.2010 Sales Purchases Gross profit Expenses Profit £'000 640 (516) 124 (94) 30 Statement of financial position as at 31.12.2010 Non-current assets Loan to staff Cash and bank Capital Profit £'000 240 15 75 330 £'000 300 30 330