The trial balance of Shanghai Co. on 31 March 20X7 is given below.

The following information is also relevant:
1. Closing inventory is valued at €133m.
2. Electricity accrued is estimated to be €5m.
3. The last rent bill of €8m was paid in January 20X7 and was for the half-year to 30 June 20X7.
4. A staff bonus relating to the year ended 31 March 20X7 of €7m was paid in May 20X7.
5. Half a year’s debenture interest is to be accrued.
6. Taxation for the year has been estimated at €83m.
7. Depreciation is to be charged on cost at the rate of:
(i) buildings – 2 per cent straight-line method;
(ii) plant and machinery – 20 per cent reducing balance method;
(iii) motor vehicles – 25 per cent reducing balance method.
8. The company has been having problems with several debtors and it was decided that the allowance for doubtful debts is to be increased to 4 per cent of outstanding receivables.
You are required to:
■ prepare an income statement for the year ended 31 March 20X7 and a balance sheet as at that date.

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Ordinary share capital Retained earnings 10% debentures Buildings at cost Plant and machinery at cost Motor vehicles at cost Accumulated depreciation - buildings Accumulated depreciation - plant m m 200 350 60 210 125 60 48 75 44 Accumulated depreciation - vehicles Inventory at 1 April 20X6 128 Sales 1,300 Purchases 580 17 Bad debts Debenture interest Directors' remuneration Discount allowed General expenses Heat and light 3 115 12 20 34 Office expenses 24 27 Rent Returns outwards 30 Salaries and wages 175 Allowance for doubtful debts 28 Trade receivables 750 Trade payables 160 Bank Total 15 2,295 2,295