| | Completing this assessment will demonstrate your ability to prepare the required financial statements according to your companys organisational procedures, as well as AASB Standards. It will also demonstrate your ability to use your problem-solving skills by reviewing the additional information and making adjustments as required to ensure there is no negative impact for reporting. Enter the information in Hanks Tanks Information into the Hanks Tanks Workbook Template, preparing the following: An updated trial balance statement based on the trial balance and adjustments provided An income statement A balance sheet A statement of changes of equity Prepare financial statements. Trial Balance and Adjustments Trial balance for Hanks Tanks Pty Ltd | Trial Balance as at 30 June 2017 | | | | Account | Dr $,000 | Cr $,000 | | Buildings | 65,625 | | | Accumulated depreciation buildings | | 5,250 | | Land | 25,875 | | | Mortgage on buildings @ 5% p.a. | | 25,000 | | Plant and equipment | 10,000 | | | Accumulated depreciation plant and equipment | | 3,000 | | Goodwill | 12,500 | | | Investments (10% debentures) | 5,000 | | | Investments (shares) | 22,500 | | | Bank CBA | 12,500 | | | Inventories 30/06/2016 | 22,500 | | | Share capital | | 112,500 | | Asset revaluation reserve | | 9,875 | | Retained profits | | 12,500 | | Calls in arrears ($0.50 call) | 3,000 | | | Interim dividend paid | 2,000 | | | Final dividend paid | 4,000 | | | Sales | | 112,500 | | Interest received from investments | | 2,750 | | Audit fees | 3,125 | | | Sales commission | 4,000 | | | Cost of goods sold | 52,500 | | | Bad debts | 2,500 | | | Marketing costs | 3,000 | | | Sales salaries | 8,500 | | | Administrative salaries | 3,000 | | | Directors fees | 5,000 | | | General expenses | 7,500 | | | Interest on mortgage | 5,250 | | | Profit on sale of surplus plant | | 2,500 | | Tax payable | | | | Accounts receivable | 13,500 | | | Accounts payable | | 7,500 | | Debentures on issue 7% | | | | | 293,375 | 293,375 | Adjustments | Adjustments required as at 30 June 2016 | | Goodwill has been valued at $1,500,000 less than carrying value | | Tax @ 30% on net profit before tax and write down of goodwill | | ABC still owes Sales salaries of $300,000 | | Depreciation on cost of buildings for the year @ 4% p.a. | | Depreciation on written down value of plant for the year @ 10% p.a. | | $62,000 of General expenses were paid in advance | | Doubtful debts were estimated at $450,000 | | Cinta Group, a major customer of Hanks Tanks, started insolvency proceedings and $500,000 owing from Cinta Group is to be written off | | Revaluation of buildings on 30 June 2016 resulted in an increase of $500,000 | | | | Additional information | | Cost of goods sold include a write-off of $1,250,000 for damaged goods | | General expenses include payments of $1,750,000 to employees | | Audit fees include payments of $1,200,000 for consulting (not audit related) | | Shares held as assets had a market value of $25,300,000 on 30 June 2015 | | On 1 July 2013, Hanks Tanks had 100,000,000 ordinary shares paid to $1. | | During the year, Hanks Tanks issued 12,500,000 shares, .50 payable on application and .50 on a call. The call money on 6,000,000 shares remain unpaid as at balance date | | Directors declared a final dividend of $.10 per participating share payable in August 2016 and require a provision | | Shares participating in dividend distributions: | | 100,000,000 shares in dividends paid and declared during the year ended 30 June 2015 | | 100,000,000 shares in interim dividend 2016 | | 106,500,000 shares in final dividend 2016 | | Debentures are redeemable on 31 December 2016 | |
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