Prepare Statement of Comprehensive Income and Statement of Financial Position as at 31 Dec 2021.
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
![Additional information:
Inventory as at 31 December 2021 was RM447,200.
Provision for company tax was RM429,520.
Depreciation 20% on cost per annum based on monthly pro rata basis to all non-
current assets.
Share capital: RM7,800,000 ordinary shares and RM520,000 4% preference
shares.
• Ordinary share dividend proposed to be 6%.
Long term borrowing interest where half year interest still owing.
Required:
Prepare Statement of Comprehensive Income and Statement of Financial Position as at
31 Dec 2021.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe55123cb-2956-423d-98b7-a30f49a91cde%2Fbed63dac-c4ce-472e-87cd-e05113667398%2Farypdsk_processed.png&w=3840&q=75)
![Zombie Berhad has the following trial balance at 31 December 2021:
RM
RM
Revenue
7,602,504
730,600
208,000
Purchases
Retums inwards
Plant at cost
Machinery at cost
10,712,000
4,940,000
Office equipment at cost
4,680,000
Accumulated depreciation-- Plant
936,000
988,000
-- Machinery
-- Office equipment
520,000
Accounts payable
Long-term borrowing
629,200
1,040,000
Accounts receivable
2,191,072
218,400
358,904
Inventory
Cash and bank
Administration expenses
520,000
26,000
Long tem borrowing interests
Salaries and wages
252,720
Marketing expenses
Discount allowed
208,000
72,800
Share capital
Retained profits as at 1 Jan 2021
8,320,000
4,602,208
General Reserve
480,584
25,118.496
...5/-
Total
25.118.496](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe55123cb-2956-423d-98b7-a30f49a91cde%2Fbed63dac-c4ce-472e-87cd-e05113667398%2Frhphob_processed.png&w=3840&q=75)
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