Monda Co. produces financial statements to 30 June annually. At 30 June 2012 Monda Co. trial balance was as follows:

	£000	£000
Sales revenue		14,776
Purchases	8,280
Inventory at 1 July 2011	1,390
Distribution cost	1,080
Administrative expenses	1,460
Deferred taxation		100
land at valuation	10,500
Buildings at cost	8,000
Buildings depreciation at 1 July 2011		2,130
Plant and equipment at cost	12,800
Plant and equipment depreciation at 1 July 2011		2,480
Trade receivables and payables	4,096	2,240
Cash at bank	160
Dividends paid	100
Ordinary share capital		14,000
Share premium account		4,000
Revaluation reserve as at 1 July 2011		3,000
Retained earnings		3,140
10% debenture loan		2,000
	47,866	47,866

The following matters remain to be adjusted for in preparing the financial statements for the year ended 30 June 2012.

1. Closing inventory at 30 June 2012 amounted to £1,576,000 at cost. A review of inventory items revealed items which had cost £80,000 and which would normally sell for £120,000 were found to have deteriorated. Remedial work costing £20,000 would be needed to enable the items to be sold for £90,000.

2. Depreciation for the year is to be charged as follows:

buildings	2 per cent per year on cost
plant and equipment	20 per cent per year on cos

Eighty per cent of the depreciation is to be charged to cost of sales, and 10 per cent each to distribution costs and administrative expenses.

3. The land is to be revalued to £12,000,000. No change to the value of the buildings was required.

4. Accruals and prepayments at 30 June 2012 were as follows:

	Accruals in £	prepayments in £
Distribution Cost	190,000	120,000
Administrative Cost	70,000	60,000

5. The debenture loan was taken out on 1 April 2012 and no interest has yet been paid on the loan.

6. Corporation tax for the year is estimated at £300,000. The deferred taxation provision is to be increased by £50,000.

Required:

a) Prepare a statement of comprehensive income, and a statement of changes in equity for Comply plc for the year ending 30 June 2012.

b) Prepare a statement of financial position (balance sheet) for Comply plc as at 30 June 2012.

All statements should be prepared to comply with IAS 1 (revised)

Answer rating: 100% (QA)

a Statement of comprehensive income for the year ended 30 June 2012 Revenue 14776 Cost of sales 7702 Gross profit 7074 Distribution costs 1080 Adminis... View the full answer