Polar Limited (hereafter Polar) has a 31 January financial year end. The accountant for Polar requested...

 

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Polar Limited (hereafter "Polar") has a 31 January financial year end. The accountant for Polar requested your assistance with the preparation of the annual financial statements for the financial year ended 31 January 2022. The following information is available with regards to the capital structure of Polar: 1. On 1 February 2021, Polar had 900 000 authorised ordinary shares of no par value, of which 360 000 were issued. The value of the issued share capital amounted to R 510 000. 2. On 1 February 2021, Polar had 300 000 authorised 10% preference shares of no par value, of which 200 000 were issued. The preference shares are non- redeemable and therefore classified as pure equity. The value of the issued 10% preference shares was R 200 000. 3. The balance of retained earnings was R 420 000 on 1 February 2021. 4. During the year an additional 240 000 ordinary shares were issued at R 3.60 each. 5. A new share issue of 150 000 10% non-redeemable preference shares at R 3 each took place during the year. Dividends paid on all issued preference shares during the year amounted to R 65 000. 6. Interim dividends of R 15 000 were declared on 30 July 2021. A final dividend of R 20 000 was declared on 15 January 2021. The accountant calculated the profit for the year as R 210 000, before realizing that the effect of the following transactions has not yet been taken into account: 7. A machine with a total cost of R 50 000 was purchased on 1 August 2021. The machine has an estimated useful live of 5 years. To finance the purchase of this machine, Polar took out a loan that carries interest at 12% per annum on 1 July 2021. The first repayment of the loan is due on 1 August 2022. 8. An invoice made out to a customer of Polar for services rendered on 10 January 2022 was captured as R 5 700. While performing the bank reconciliation, the accountant inspected the invoice and determined that the actual amount of the invoice is R 7 500. 5| Page REQUIRED: a) CACN021: TEST 1 Prepare the Statement of Changes in Equity of Polar for the year ended 31 January 2022 in terms of IAS 1: Presentation of Financial Statements. Communication skills: Presentation 2022 MARKS [9] [1] Polar Limited (hereafter "Polar") has a 31 January financial year end. The accountant for Polar requested your assistance with the preparation of the annual financial statements for the financial year ended 31 January 2022. The following information is available with regards to the capital structure of Polar: 1. On 1 February 2021, Polar had 900 000 authorised ordinary shares of no par value, of which 360 000 were issued. The value of the issued share capital amounted to R 510 000. 2. On 1 February 2021, Polar had 300 000 authorised 10% preference shares of no par value, of which 200 000 were issued. The preference shares are non- redeemable and therefore classified as pure equity. The value of the issued 10% preference shares was R 200 000. 3. The balance of retained earnings was R 420 000 on 1 February 2021. 4. During the year an additional 240 000 ordinary shares were issued at R 3.60 each. 5. A new share issue of 150 000 10% non-redeemable preference shares at R 3 each took place during the year. Dividends paid on all issued preference shares during the year amounted to R 65 000. 6. Interim dividends of R 15 000 were declared on 30 July 2021. A final dividend of R 20 000 was declared on 15 January 2021. The accountant calculated the profit for the year as R 210 000, before realizing that the effect of the following transactions has not yet been taken into account: 7. A machine with a total cost of R 50 000 was purchased on 1 August 2021. The machine has an estimated useful live of 5 years. To finance the purchase of this machine, Polar took out a loan that carries interest at 12% per annum on 1 July 2021. The first repayment of the loan is due on 1 August 2022. 8. An invoice made out to a customer of Polar for services rendered on 10 January 2022 was captured as R 5 700. While performing the bank reconciliation, the accountant inspected the invoice and determined that the actual amount of the invoice is R 7 500. 5| Page REQUIRED: a) CACN021: TEST 1 Prepare the Statement of Changes in Equity of Polar for the year ended 31 January 2022 in terms of IAS 1: Presentation of Financial Statements. Communication skills: Presentation 2022 MARKS [9] [1]

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