1. Marlboro Ltd. Has an authorized share capital of sh. 1,000,000 in ordinary shares of sh.5 each 120,000 shares have been issued on which sh. 3.75 per share has been called up.

The following is the trial balance on 30^th April 2014.

 

The following information is relevant:

1. The following items are provided for
   • Director’s fees sh. 45,000
   • Auditor’s remunerations sh. 9,000
   • Depreciation at 2% on the cost of the freehold, land & buildings and 10% on the cost of the plant & machinery.
   • Sh. 7,500 for doubtful debts.
2. Quoted investments have a market value of sh.64, 000.
3. The corporation tax at 30% based on the profits of the year is estimated at sh. 85,000.
4. The directors decided to write off the preliminary expenses, transfer sh. 11,000 to General Revenue and sh.10,000 to a reserve for future fluctuations in raw material prices and distribute a dividend of 50 cents per share.

Required

1. Prepare in a vertical form for publication profit & lost account for the year ended 30^th April 2014. 

A balance sheet as of that date. 

 

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Dr Cr Shs. Shs. Share Capital Frechold Land & Buildings at cost Plant and machinery at cost (addition during the year Shs. 40,000) 450,000 450,000 400,000 Goodwill at cost 50,000 Preliminary expenses Quoted investments at cost Stock April 30, 2014 at cost 26,250 60,000 117,500 Accounts receivable 225,000 Provision for depreciation - April 30, 2014 On freehold land & building On plant and machinery Income from quoted investments Share premium a/c Accounts payable & accurals 100,000 150,000 2,500 20,000 75,000 Balance at bank 41,250 Cash in hand 1,875 Profit & Loss a/c - bal may, 1, 2013 Profit on trading for the year to 30 April 2014 192,500 281,875 Game reserves O 100,000 1,371,875 1,371,875 Dr Cr Shs. Shs. Share Capital Frechold Land & Buildings at cost Plant and machinery at cost (addition during the year Shs. 40,000) 450,000 450,000 400,000 Goodwill at cost 50,000 Preliminary expenses Quoted investments at cost Stock April 30, 2014 at cost 26,250 60,000 117,500 Accounts receivable 225,000 Provision for depreciation - April 30, 2014 On freehold land & building On plant and machinery Income from quoted investments Share premium a/c Accounts payable & accurals 100,000 150,000 2,500 20,000 75,000 Balance at bank 41,250 Cash in hand 1,875 Profit & Loss a/c - bal may, 1, 2013 Profit on trading for the year to 30 April 2014 192,500 281,875 Game reserves O 100,000 1,371,875 1,371,875