Below was an extract from the books of Piko Sdn Bhd for the year ended 31 December
Question:
Below was an extract from the books of Piko Sdn Bhd for the year ended 31 December 2019.
RM'000
Retained profit 31 December 2018
158,000
Inventory 1 January 2019
39,000
Purchases
550,000
Sales
1,292,000
Share capital
120,000
Distribution expenses
116,000
Administration expenses
241,000
Bad debts
23,500
6% bonds (redeemable in Year 2021)
400,000
Trade receivables
200,000
Trade payables
73,500
Allowance for doubtful debts
6,000
Interest paid on bonds
12,000
Bank
58,000
Dividends paid
105,000
Plant and machinery at cost
920,000
Accumulated depreciation as of 1 January 2019
215,000
8
Additional information:
i. Inventory on 31 December 2018 was RM35,000.
ii. Depreciation on plant and machinery for the Year Ended December 2019 is to be provided at the rate of 10% at cost.
iii. Accrued distribution expenses amounted to RM7,500.
iv. Prepaid administrative expenses amounted to RM4,000.
v. The allowance for doubtful debts should be adjusted to 2% of the trade receivables as of 31 December 2019.
vi. Company tax rate is estimated to be 20% of the profit before tax.
Required:
a. Prepare the Statement of Comprehensive Income for the year ended 31 December 2019 by adopting the function of expense or “cost of sales” method in accordance with MFRS 101 Presentation of Financial Statements: (Show workings where appropriate) (12 marks)
b. The Statement of Financial Position as of 31 December 2019.
Financial Accounting and Reporting
ISBN: 978-1292162409
18th edition
Authors: Barry Elliott, Jamie Elliott