DFIDO Limited is a company involved in retailing of special event promotional materials. An extract from...

  

 

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DFIDO Limited is a company involved in retailing of special event promotional materials. An extract from the trial balance of DFIDO Limited on 30 June 2019: Ordinary share capital (510 000 shares issued for R1 12% non-redeemable preference share capital (200000 shares issued at RO,50 each) R510 000 100 000 15% Debentures Retained earnings Land and buildings: carrying amount Plant and equipment: Carrying amount Merchandise inventory 100 000 16 485 420 000 110 500 90 450 Rent receivable 500 Inventory in transit A summary of the company's receipts and payments for the year ended 30 June 2020 is provided below: 8 300 Receipts Sales Rent 15% Debentures R785 000 5 000 50 000 Раyments: Accounts payable General administration expenses 340 000 26 115 Auditors' and directors' remuneration 180 000 7 500 1 555 6 000 15 000 125 000 37 424 Debenture interest Donations to hands of compassion fund Insurance Repairs to buildings Extensions to buildings Current company tax The following additional information is available: I. All sales are made on cash only. II. The land and buildings cost R520 000 were acquired on 1 July 2014. The land cost R120 000 and the building (an office building cost R400 000). The extensions to the building were completed on 30 June 2020. A section of the office building had be sublet at R500 per month until 31 March 2020. Land is not depreciated. The office building is depreciated at 5% per annum on cost with nil residual value. III. The plant and equipment originally cost R138 125. Plant and equipment is depreciated at 20% per annum on the reducing balance basis. IV. The debentures were issued on 2 January 2020. All debentures have been issued at par value and are secured on land and buildings. V. All payments in respect of accounts payable are for goods for resale. All amounts owing to suppliers are settled by the end of the month in which the purchases are made. Insurance payments of R3 000 are made quarterly in advance. The insurance contract was entered into on 1 February 2020. VII. Closing inventory was valued at a first-in, first-out cost of R80 110. The net realisable was estimated to be R75 110. Current company tax must be accounted for at 30%. All the ordinary and preference shareholders are subject to withholding tax on dividends of 20%. The directors passed the following resolutions at their final meeting for the financial reporting period ended on 30 June 2020. • The land and building are revalued for the first time to reflect their fair value of R750 000: The fair value of land is R200 000. VI. VIII. Preference dividends is declared. An ordinary dividend of RO.05 per share is declared to shareholders registered on 30 June 2020. You are required to: (a) Prepare property, plant, and equipment movement schedule on 30 June 2020 for DFIDO Limited. Detailed workings should be given to support your answer. [18 marks] (b) Prepare the statement of profit or loss of DFIDO Limited for the year ended 30 June 2020. [11 marks) (c) Provide an extract of equity, non-current liabilities, and current liabilities on the statement of financial position of DFIDO Limited on 30 June 2020. (11 marks) DFIDO Limited is a company involved in retailing of special event promotional materials. An extract from the trial balance of DFIDO Limited on 30 June 2019: Ordinary share capital (510 000 shares issued for R1 12% non-redeemable preference share capital (200000 shares issued at RO,50 each) R510 000 100 000 15% Debentures Retained earnings Land and buildings: carrying amount Plant and equipment: Carrying amount Merchandise inventory 100 000 16 485 420 000 110 500 90 450 Rent receivable 500 Inventory in transit A summary of the company's receipts and payments for the year ended 30 June 2020 is provided below: 8 300 Receipts Sales Rent 15% Debentures R785 000 5 000 50 000 Раyments: Accounts payable General administration expenses 340 000 26 115 Auditors' and directors' remuneration 180 000 7 500 1 555 6 000 15 000 125 000 37 424 Debenture interest Donations to hands of compassion fund Insurance Repairs to buildings Extensions to buildings Current company tax The following additional information is available: I. All sales are made on cash only. II. The land and buildings cost R520 000 were acquired on 1 July 2014. The land cost R120 000 and the building (an office building cost R400 000). The extensions to the building were completed on 30 June 2020. A section of the office building had be sublet at R500 per month until 31 March 2020. Land is not depreciated. The office building is depreciated at 5% per annum on cost with nil residual value. III. The plant and equipment originally cost R138 125. Plant and equipment is depreciated at 20% per annum on the reducing balance basis. IV. The debentures were issued on 2 January 2020. All debentures have been issued at par value and are secured on land and buildings. V. All payments in respect of accounts payable are for goods for resale. All amounts owing to suppliers are settled by the end of the month in which the purchases are made. Insurance payments of R3 000 are made quarterly in advance. The insurance contract was entered into on 1 February 2020. VII. Closing inventory was valued at a first-in, first-out cost of R80 110. The net realisable was estimated to be R75 110. Current company tax must be accounted for at 30%. All the ordinary and preference shareholders are subject to withholding tax on dividends of 20%. The directors passed the following resolutions at their final meeting for the financial reporting period ended on 30 June 2020. • The land and building are revalued for the first time to reflect their fair value of R750 000: The fair value of land is R200 000. VI. VIII. Preference dividends is declared. An ordinary dividend of RO.05 per share is declared to shareholders registered on 30 June 2020. You are required to: (a) Prepare property, plant, and equipment movement schedule on 30 June 2020 for DFIDO Limited. Detailed workings should be given to support your answer. [18 marks] (b) Prepare the statement of profit or loss of DFIDO Limited for the year ended 30 June 2020. [11 marks) (c) Provide an extract of equity, non-current liabilities, and current liabilities on the statement of financial position of DFIDO Limited on 30 June 2020. (11 marks)