The following trial balance relates to Jelly Berhad at 30 September 2022:

	Note		RM'000		RM'000
Land and Buildings – at valuation 1 October 2021	(i)		150,000
Plant and equipment – at cost	(i)		229,800
Plant and equipment – accumulated depreciation at 1 October 2021					73,800
Capitalised development expenditure – at 1 October 2021	(ii)		60,000
Development expenditure – accumulated amortisation at 1 October 2021					18,000
Closing inventory at 30 September 2022			60,000
Trade receivables			129,300
Bank					3,900
Trade payables and provisions	(iii)				71,400
Revenue	(i)				900,000
Cost of sales			612,000
Distribution costs			43,500
Administrative expenses	(iii)		66,600
Preference dividend paid			2,400
Interest on bank borrowings			600
Equity dividend paid			18,000
Research and development costs	(ii)		25,800
Equity shares (200 million shares)					150,000
8% redeemable preference shares of RM1 each	(iv)				60,000
Retained earnings at 1 October 2021					90,900
Revaluation reserve – Land and building					30,000
			1,398,000		1,398,000

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The following notes are relevant: 11 (1) (ii) (iv) (v) 1 On 1 October 2021 an item of plant was disposed of for RM3.5 million cash. The proceeds have been treated as sales revenue by Jelly Berhad. The plant is still included in the above trial balance figures at its cost of RM16 million and depreciation of RM12 million (to the date of disposal). All plant is depreciated at 20% per annum using the reducing balance method. Depreciation and amortisation of all non-current assets are charged to cost of sales. 1 1 In addition to the capitalised development expenditure (of RM60 million), further research and development costs were incurred on a new project which commenced on 1 October 2021. The research stage of the new project lasted until 31 December 2021 and incurred RM7.8million of costs. From that date, the project incurred development costs of RM2,000,000 per month. On 1 April 2022 the directors became confident that the project would be successful and yield a profit well in excess of its costs. The project is still in development at 30 September 2022. Capitalised development expenditure is amortised at 20% per annum using the straight-line method. All expensed research and development is charged to cost of sales. 1 11 11 11 The company's policy is to revalue its property at each year end and at 30 September 2022 the property was valued at RM140 million (land at RM20 million with no changes). The buildings had a remaining life of 10 years at 1 October 2021. 1 1 Jelly Berhad is being sued by a customer for RM3 million for breach of contract over a cancelled order. Jelly Berhad has obtained legal opinion that there is 80% chance that Jelly Berbad will lose the case and the estimated compensation was RM2 million. Accordingly, Jelly Berhad, has provided RM2 million included in administrative expenses in respect of the claim. The unrecoverable legal costs of defending the action are estimated at RM180,000. These have not been provided for as the legal action will not go to court until next year. 11 The preference shares were issued on 1 April 2021 at par. They are redeemable at a large premium which gives them an effective finance cost of 12% per annum. 1 The directors have estimated the provision for income tax for the year ended 30 September 2022 at RM20.5 million. 11 Required (a) Prepare a Statement of profit or loss and statement of changes in equity for Jelly Berhad for the year ended 30 September 2022 and a statement of financial position as at that date in a form suitable for publication. (25 marks) 11 The following notes are relevant: 11 (1) (ii) (iv) (v) 1 On 1 October 2021 an item of plant was disposed of for RM3.5 million cash. The proceeds have been treated as sales revenue by Jelly Berhad. The plant is still included in the above trial balance figures at its cost of RM16 million and depreciation of RM12 million (to the date of disposal). All plant is depreciated at 20% per annum using the reducing balance method. Depreciation and amortisation of all non-current assets are charged to cost of sales. 1 1 In addition to the capitalised development expenditure (of RM60 million), further research and development costs were incurred on a new project which commenced on 1 October 2021. The research stage of the new project lasted until 31 December 2021 and incurred RM7.8million of costs. From that date, the project incurred development costs of RM2,000,000 per month. On 1 April 2022 the directors became confident that the project would be successful and yield a profit well in excess of its costs. The project is still in development at 30 September 2022. Capitalised development expenditure is amortised at 20% per annum using the straight-line method. All expensed research and development is charged to cost of sales. 1 11 11 11 The company's policy is to revalue its property at each year end and at 30 September 2022 the property was valued at RM140 million (land at RM20 million with no changes). The buildings had a remaining life of 10 years at 1 October 2021. 1 1 Jelly Berhad is being sued by a customer for RM3 million for breach of contract over a cancelled order. Jelly Berhad has obtained legal opinion that there is 80% chance that Jelly Berbad will lose the case and the estimated compensation was RM2 million. Accordingly, Jelly Berhad, has provided RM2 million included in administrative expenses in respect of the claim. The unrecoverable legal costs of defending the action are estimated at RM180,000. These have not been provided for as the legal action will not go to court until next year. 11 The preference shares were issued on 1 April 2021 at par. They are redeemable at a large premium which gives them an effective finance cost of 12% per annum. 1 The directors have estimated the provision for income tax for the year ended 30 September 2022 at RM20.5 million. 11 Required (a) Prepare a Statement of profit or loss and statement of changes in equity for Jelly Berhad for the year ended 30 September 2022 and a statement of financial position as at that date in a form suitable for publication. (25 marks) 11

Answer rating: 100% (QA)

Ans statement of profit and loss account for the year sep 20 2022 particulars amountRM000 revenue 896500 Cost of sales 525640 gross profit 370860 distributing costs 43500 administrative expenses 64600 ... View the full answer