The following is a draft set of simplified financial statements for Pear Limited for the year ended
Question:
The following is a draft set of simplified financial statements for Pear Limited for the year ended 30 September 2015.Income statement for the year ended 30 September 2015
Statement of financial position as at 30 September 2015
The following information is available:1 D epreciation has not been charged on office equipment with a carrying amount of ?100,000. This class of assets is depreciated at 12 per cent a year using the reducing-balance method.2 A new machine was purchased, on credit, for ?30,000 and delivered on 29 September 2015 but has not been included in the financial statements. (Ignore depreciation.)3 A sales invoice to the value of ?18,000 for September 2015 has been omitted from the financial statements. (The cost of sales figure is stated correctly.)4 A dividend of ?25,000 had been approved by the shareholders before 30 September 2015, but was unpaid at that date. This is not reflected in the financial statements.5 The interest payable on the loan notes for the second half-year was not paid until 1 October 2015 and has not been included in the financial statements.6 A n allowance for trade receivables is to be made at the level of 2 per cent of trade receivables.7 A n invoice for electricity to the value of ?2,000 for the quarter ended 30 September 2015 arrived on 4 October and has not been included in the financial statements.8 The charge for taxation will have to be revised to take account of any amendments to the taxable profit arising from items 1 to 7. Make the simplifying assumption that tax is payable shortly after the end of the year, at the rate of 30 per cent of the profit before tax.
Required:Prepare a revised set of financial statements for the year ended 30 September 2015 incorporating the additional information in 1 to 8 above. (Work to the nearest ?1,000.)
Financial StatementsFinancial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
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Accounting and Finance An Introduction
ISBN: 978-1292088297
8th edition
Authors: Peter Atrill, Eddie McLaney