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[Total 20 marks] Question 11 The following balances have been extracted from the books of Bright Days pic at 31 March 2015: Bright Days Plc Em 637 316 68 563 645 38 42 1,390 675 1,578 549 830 3,800 210 3,865 578 10,404 1,800 Administrative expenses Bank Deferred taxation Directors' remuneration Distribution expenses Dividends received Interest paid Investments Land and buildings Machinery-cost Machinery-accumulated depreciation Opening inventories Premises-cost Premises-accumulated depreciation Purchases Retained earnings Revenue Share capital 25p ordinary shares Trade payables Trade receivables 6% Debenture 2018 1,250 1,500 You are also provided with the following information Closing inventories were estimated at 650m. A piece of land was recently revalued to 150m. The cost of the land before revaluation was 105m. No accounting entries were made in respect of this revaluation. Depreciation is to be charged on the following basis: Premises: 2% straight line Machinery: 25% reducing balance . Corporation tax is estimated as 650 m for the year (Question continues on next page) i) Prepare Bright Days plc's "statement of profit and loss" for the year ended 31st March 2015 and its "statement of financial position" as at that date. These should be in a suitable form for publication, insofar as this is possible from the above information 14 marks] i) The company's CFO is concerned that the narrative part of the annual report is too detailed. As a manager responsible for its preparation: a) explain the purpose of the narrative part of the annual report; b) give examples of the stakeholders who use narrative and numerical financial information. 2 marks] ) Calculate profitability margin ratios for Bright Days plc and explain how these ratios could indicate the type of business model that the company has adopted List any other information that would be useful in order to improve the interpretation of these 4 marks] Total 20 marks] [Total 20 marks] Question 11 The following balances have been extracted from the books of Bright Days pic at 31 March 2015: Bright Days Plc Em 637 316 68 563 645 38 42 1,390 675 1,578 549 830 3,800 210 3,865 578 10,404 1,800 Administrative expenses Bank Deferred taxation Directors' remuneration Distribution expenses Dividends received Interest paid Investments Land and buildings Machinery-cost Machinery-accumulated depreciation Opening inventories Premises-cost Premises-accumulated depreciation Purchases Retained earnings Revenue Share capital 25p ordinary shares Trade payables Trade receivables 6% Debenture 2018 1,250 1,500 You are also provided with the following information Closing inventories were estimated at 650m. A piece of land was recently revalued to 150m. The cost of the land before revaluation was 105m. No accounting entries were made in respect of this revaluation. Depreciation is to be charged on the following basis: Premises: 2% straight line Machinery: 25% reducing balance . Corporation tax is estimated as 650 m for the year (Question continues on next page) i) Prepare Bright Days plc's "statement of profit and loss" for the year ended 31st March 2015 and its "statement of financial position" as at that date. These should be in a suitable form for publication, insofar as this is possible from the above information 14 marks] i) The company's CFO is concerned that the narrative part of the annual report is too detailed. As a manager responsible for its preparation: a) explain the purpose of the narrative part of the annual report; b) give examples of the stakeholders who use narrative and numerical financial information. 2 marks] ) Calculate profitability margin ratios for Bright Days plc and explain how these ratios could indicate the type of business model that the company has adopted List any other information that would be useful in order to improve the interpretation of these 4 marks] Total 20 marks]