The following balances were extracted from the books of accounts of Bagman Plc as of the end of the financial year. Trial Balance as of 31 March 2018

DR CR

K MILLION K MILLION

Revenue 15000

Purchases 6081

Inventory-1/04/2017 495

Trade Payables 504

Trade Receivables 2451

Ordinary share capital( K 600 shares) 18000

15% Cumulative preference Shares (K 800 shares) 3000

Investment Property 19725

Land and Buildings-Cost 7200

Accumulated Depreciation 1/04/2017 2160

Fixtures and Fitting-cost 2700

Accumulated Depreciation 1/04/2017 1320

20% Loan notes( Redeemable 2022) 600

Retained earnings -31/03/2021 633

Differed tax provision 1200

Shared premium 30

General Administration expense 20

Delivery expenses 160

Office expenses 210

Sundry expenses 45

Directors’ Remuneration 15

Salaries and Wages 3600

20% Loan note paid 72

Cash and Cash equivalents 30

Short term investment 3

Income tax 60

Income from investment property 300

Dividend Received 1500

Interim dividend paid;

Preference 200

Ordinary 1300

TOTALS 44307 44307

ADDITIONAL INFORMATION

1. Inventory at the end of the financial year was valued at k 500million cost

2. Accrued expenses at 31 March 2018 were Office expenses-K15mllion and Salaries and wages- K40million

3. K12million and K5million were prepaid for delivery expenses and general Administrative expenses as of 31 March 2018.

4. Land and Building were revalued at K750million on 1/04/2017. The director decided to incorporate this valuation into account.

5. The balance of the income tax account represents the remaining amount after the settlement of the tax liability for the financial year ended 31 March 2017.

6. Deferred tax amount is to adjust to K35million, due to timing differences that occurred for the year ended 31 March 2018

7. The income tax charge for the year was estimated at K810 million

8. Depreciation is to be provided as follows; Land and Building-4% of cost or valuation and Fixture and Fittings -20% on reducing balance basis

9. Certain expenses are to be apportioned as follows

Expense item Cost of sales Distribution Administration

Salaries and Wages 25% 30% 45%

Deprecation –Land and Buildings 35% 20% 45%

Deprecation- Fixtures and Fittings 20% 30% 50%

10. The directors proposed a final dividend on preference share and a final ordinary dividend of K2 per share.

Required Prepare Bagman Plc

a) Statement of Profit or Loss for the year ended 31 March 2018

b) Statement of Changes in Equity for the year ended 31 March 2018

c) Statement of Financial Position as of 31 March 2018. In accordance with requirements of IFRS (for Publication as per IAS1)

Answer rating: 100% (QA)

Quiz a Statement of Profit and Loss for the year ended 31 March 2018 Revenue 15000 Cost of Sales 608... View the full answer