Question $3(25$ Marks$)$

LS Printing Limited is a retailer listed on the NSX$.$ The company distributes fast moving consumer

goods as well publishing and printing books with the headquarters in Katima Mulilo at erf $452,$

Zambezi region. The trial balance of the company at $28$ February $2023$ is shown below:

LS Printing Limited

Trial balance as at $28$ February $2023$

The following information is relevant: i$.$ The authorised share capital comprises of $10000000$ ordinary shares of no par value.

ii$.,1000000$ shares were issued at $N$$$1$ on $30$ November $2022.$

iii. The land and buildings are used for the supply of goods and for administration purposes.

The buildings were revalued on $28$ February $2023$ to a fair value of $N$$$6720000.$ This

represented an increase of N$$160000$ over the previous carrying amount. This has

already been processed.

iv$.$ All property, plant and equipment is depreciated using the straight$-$line method.

v$.$ The building is $320$ square metres in area, of which $180$ square metres are used for the

warehouse $($used to store goods prior to despatch$)$ and the remaining $140$ square metres

is used as the company head$-$office.

vi$.$ The equipment consists of items used in the despatch area and office equipment and the

balance relates to depreciation of the equipment used in the despatch area.

vii. $,N$$$570000$ of the salaries and wages relates to the employees hired in the despatch area

and $N$$$642000$ relates to employees employed in the head office.

viii. Postage and packaging for purposes of safe transportation relate purely to the despatch

area

ix$.$ Telephone of $N$$$27000$ was incurred during the year. Of this, $N$$$15000$ was incurred in

the despatch department and $N$$$12000$ was incurred in the head$-$office.

x$.$ Electricity of $N$$$51000$ was incurred during the year. Of this, $N$$$35000$ was incurred in

the despatch department and $N$$$16000$ was incurred in the head$-$office.

xi$.$ Included in the sales figure is amount of $N$$$200000$ relating to value added tax for the

period. Goods sold to a customer on credit for $N$$$120000$ in August $2022$ which originally

cost $N$$$72000$ were returned to the company on $29$ September $2022.$ No entries have

been made in the accounts to reflect this return of goods.

xii. Dividends of $N$$$100000$ were declared on $18$ March $2022$ in respect of the year ended

$28$ February $2022.$

xiii. The tax expense for the year has been correctly calculated at $N$$$353550.$

REQUIRED:

Prepare the statement of profit and loss and other comprehensive income of LS Printing

Limited for the year ended $28$ February $2023$ to conform with International Financial

Reporting Standards according to the function of expenses method.

Prepare the extracted statement of financial position "showing assets section only" of LS

Printing Limited as at $28$ February $2023$ to conform with International Financial Reporting

Standards.

$(5$ marks$)$

In so far as information is available, prepare the following notes to the financial

statements for the year ended $28$ February $2023$ in conformity with International Financial

Reporting Standards: $(5$ marks$)$

i$.$ Statement of compliance

ii$.$ Summary of significant accounting policies

iii. Domicile and legal form

iv$.$ Revenue

v$.$ Inventory

Show all your calculations!!