The following financial information has been extracted from the books of Pole Company as at 31...

  

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The following financial information has been extracted from the books of Pole Company as at 31 December 2023. Revenue 8% of loan notes General reserve Land at cost Purchases Rent expenses Consultancy fees Staff Training Costs Returns inwards Returns outwards Utilities expenses Marketing expenses Trade payables Trade receivables Discount received Discount allowed Freight inwards Digital Marketing Expenses Administrative expenses Website Costs Wages and salaries Website Maintenance Costs Bank balance Buildings at cost Buildings, accumulated depreciation 1/1/2023 Machinery at cost Dr $ 1,350,000 3,056,240 324,000 236,400 365,440 12,000 56,700 387,560 836,400 34,520 305,000 455,730 123,600 201,470 936,000 67,860 406,550 910,000 684,000 Cr $ 6,031,308 1,000,000 150,000 9,560 944,800 7,500 220,000 Machinery, accumulated depreciation 1/1/2023 Allowance for receivables at 1/1/2023 Retained earnings at 1/1/2023 Ordinary shares capital Inventory at 1/1/2023 650,020 11,399,490 15,400 21,470 999,452 2,000,000 11,399,490 Additional information: 1.The company's depreciation policy is as follows: 3. 2. Account receivables include irrecoverable debts of $120,000, which is to be written off as bad debts as the customer had gone bankrupt. An allowance for receivables should then be created, representing 5% of the account receivables remaining after the irrecoverable debt has been written off. Inventory is value at $610,000 as at 31 December 2023. 4. Consultancy fees owing due to additional spending for the new business plan amounted to $155,000. 6. vi.Building - 3% per annum using the straight-line method vii.Machinery - 20% per annum using the reducing balance method viii. Vehicles - 20% per annum using the reducing balance method ix.No depreciation is required for the land. 5. On 1 February 2023, motor vehicles were purchased for $410,000. These vehicles were required to be used to send goods to customers. 7. x.A full year's depreciation is charged in the year of purchase, and no depreciation is charged in the year of disposal. Required: Loan note interest had not been paid during the year. Wages & salaries to be paid and owing to staff amounted to $64,500 Prepare the Income Statement of Pole Company for the year ended 31 December 2023. (10 marks) b. Prepare the Statement of Financial Position of Pole Company as at 31 December 2023. a. (10 marks) The following financial information has been extracted from the books of Pole Company as at 31 December 2023. Revenue 8% of loan notes General reserve Land at cost Purchases Rent expenses Consultancy fees Staff Training Costs Returns inwards Returns outwards Utilities expenses Marketing expenses Trade payables Trade receivables Discount received Discount allowed Freight inwards Digital Marketing Expenses Administrative expenses Website Costs Wages and salaries Website Maintenance Costs Bank balance Buildings at cost Buildings, accumulated depreciation 1/1/2023 Machinery at cost Dr $ 1,350,000 3,056,240 324,000 236,400 365,440 12,000 56,700 387,560 836,400 34,520 305,000 455,730 123,600 201,470 936,000 67,860 406,550 910,000 684,000 Cr $ 6,031,308 1,000,000 150,000 9,560 944,800 7,500 220,000 Machinery, accumulated depreciation 1/1/2023 Allowance for receivables at 1/1/2023 Retained earnings at 1/1/2023 Ordinary shares capital Inventory at 1/1/2023 650,020 11,399,490 15,400 21,470 999,452 2,000,000 11,399,490 Additional information: 1.The company's depreciation policy is as follows: 3. 2. Account receivables include irrecoverable debts of $120,000, which is to be written off as bad debts as the customer had gone bankrupt. An allowance for receivables should then be created, representing 5% of the account receivables remaining after the irrecoverable debt has been written off. Inventory is value at $610,000 as at 31 December 2023. 4. Consultancy fees owing due to additional spending for the new business plan amounted to $155,000. 6. vi.Building - 3% per annum using the straight-line method vii.Machinery - 20% per annum using the reducing balance method viii. Vehicles - 20% per annum using the reducing balance method ix.No depreciation is required for the land. 5. On 1 February 2023, motor vehicles were purchased for $410,000. These vehicles were required to be used to send goods to customers. 7. x.A full year's depreciation is charged in the year of purchase, and no depreciation is charged in the year of disposal. Required: Loan note interest had not been paid during the year. Wages & salaries to be paid and owing to staff amounted to $64,500 Prepare the Income Statement of Pole Company for the year ended 31 December 2023. (10 marks) b. Prepare the Statement of Financial Position of Pole Company as at 31 December 2023. a. (10 marks)

Answer rating: 100% (QA)

Income Statement for the Year Ended 31 December 2023 Revenue 6031308 Cost of Goods Sold Inventory at ... View the full answer