Chrisha is a limited liability company. You have been employed as the Assistant Financial Controller and...

 

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Chrisha is a limited liability company. You have been employed as the Assistant Financial Controller and have been assigned to prepare the year-end financial statements, in particular the Statement of Comprehensive Income. After a detailed discussion with your supervisor, you were presented with the following trial balance as of 31 December 2019: Dr $000 Cr SO00 250 Distribution costs Administrative expenses 126 Salaries 1,180 Discounts received 88 Sales 9,427 Property expenses 290 Returns inward 166 Cash 27 Insurance 130 Purchases 6,248 Inventory at 1 January 2018 610 Bank 311 Loan note interest 58 Share premium account 350 Retained earnings at 1 January 2018 875 Allowance for receivables at 1 January 2018 70 Trade payables 507 Trade receivables 1,700 7% Loan notes 822 Receivables expense $1 Ordinary shares Dividends paid: Final for year ended 31 December 2018 260 2,850 200 Land at cost 1,295 Buildings at cost 2,640 Motor vehicles at cost 420 21/01 Furniture and equipment at cost 800 Accumulated depreciation at 1 January 2018 Buildings Motor vehicles Furniture and equipment 625 140 335 16,400 16,400 Further information relating to the company is as follows: i. The insurance includes $10,000 which relates to January 2020. ii. Buildings are depreciated at 5% of the cost. Building depreciation during the year is allocated 50% to distribution costs and 50% to administrative expenses. On 31 December 2019 the buildings were professionally valued at $3,150,000 and the directors wish this valuation to be incorporated into the accounts. iii. Depreciation is to be charged as follows: a. Motor vehicles at 25% of written down value, allocated to distribution costs iv. b. Furniture and equipment at 20% of the cost, allocated to administrative expenses. v. Inventory on 31 December 2019 was valued at $480,000 based on its original cost. vi. Based on past experience the allowance for receivables is to be increased to 5% of trade receivables and allocated to administrative expenses. vii. There are salaries outstanding of $60,000 for the year ended 31 December 2019. viii. The items listed below should be apportioned as indicated: ix. Cost of Sales Distribution Administrative Costs Expenses 50% Property expenses Insurance 20% 30% 20% 40% 40% Salaries 25% 35% 40% Discounts received 100% x. Tax of $120,000 is to be provided for the year. Required: A. Prepare the statement of comprehensive income for the year ended 31 December 2019 for Chrisha Ltd in accordance with IAS 1, Presentation of Financial Statements. (14 marks) В. The Accounting Clerk in your department overheard the conversation with your supervisor and would like you to explain the rationale behind the difference between the Income Statement and the Statement of Comprehensive Income. (3 marks) C. Prepare detailed workings to show the amount included as *other comprehensive income. (3 marks) Chrisha is a limited liability company. You have been employed as the Assistant Financial Controller and have been assigned to prepare the year-end financial statements, in particular the Statement of Comprehensive Income. After a detailed discussion with your supervisor, you were presented with the following trial balance as of 31 December 2019: Dr $000 Cr SO00 250 Distribution costs Administrative expenses 126 Salaries 1,180 Discounts received 88 Sales 9,427 Property expenses 290 Returns inward 166 Cash 27 Insurance 130 Purchases 6,248 Inventory at 1 January 2018 610 Bank 311 Loan note interest 58 Share premium account 350 Retained earnings at 1 January 2018 875 Allowance for receivables at 1 January 2018 70 Trade payables 507 Trade receivables 1,700 7% Loan notes 822 Receivables expense $1 Ordinary shares Dividends paid: Final for year ended 31 December 2018 260 2,850 200 Land at cost 1,295 Buildings at cost 2,640 Motor vehicles at cost 420 21/01 Furniture and equipment at cost 800 Accumulated depreciation at 1 January 2018 Buildings Motor vehicles Furniture and equipment 625 140 335 16,400 16,400 Further information relating to the company is as follows: i. The insurance includes $10,000 which relates to January 2020. ii. Buildings are depreciated at 5% of the cost. Building depreciation during the year is allocated 50% to distribution costs and 50% to administrative expenses. On 31 December 2019 the buildings were professionally valued at $3,150,000 and the directors wish this valuation to be incorporated into the accounts. iii. Depreciation is to be charged as follows: a. Motor vehicles at 25% of written down value, allocated to distribution costs iv. b. Furniture and equipment at 20% of the cost, allocated to administrative expenses. v. Inventory on 31 December 2019 was valued at $480,000 based on its original cost. vi. Based on past experience the allowance for receivables is to be increased to 5% of trade receivables and allocated to administrative expenses. vii. There are salaries outstanding of $60,000 for the year ended 31 December 2019. viii. The items listed below should be apportioned as indicated: ix. Cost of Sales Distribution Administrative Costs Expenses 50% Property expenses Insurance 20% 30% 20% 40% 40% Salaries 25% 35% 40% Discounts received 100% x. Tax of $120,000 is to be provided for the year. Required: A. Prepare the statement of comprehensive income for the year ended 31 December 2019 for Chrisha Ltd in accordance with IAS 1, Presentation of Financial Statements. (14 marks) В. The Accounting Clerk in your department overheard the conversation with your supervisor and would like you to explain the rationale behind the difference between the Income Statement and the Statement of Comprehensive Income. (3 marks) C. Prepare detailed workings to show the amount included as *other comprehensive income. (3 marks)

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