Question 3 The following Trial Balance was extracted from the books of A.B.L Sdn Bhd as at 31 December 20X1: Trial Balance as at 31 December 20X1 Dr Cr RM RM Capital – issued & fully paid: 60,000 Ordinary shares 60,000 20,000 non- redeemable Preference shares 20,000 General reserves 14,000 Balance of retained earnings 7,000 5% Debentures 50,000 Trade receivables and Trade payables 42,240 44,000 Cash at bank 35,000 Land and building at cost 100,000 Plant and machinery at cost 50,000 Inventories 31,000 Cash in hand 1,000 Accumulated depreciation, 1 January 20X1 Land and building 20,000 Plant and machinery 7,500 Gross profit 145,000 Administrative expenses 44,000 Selling and distribution expenses 56,000 Discounts 500 1,540 Debenture interest 2,500 Legal fees 1,200 Directors’ fees 5,600 369,040 369,040 Required: Prepare the Statement of Profit or Loss and an extract of the Statement of Changes in Equity (showing the movements in retained earnings) for the year ended 31 December 20X1 and the Statement of Financial Position at that date, taking into account the following additional information: (i) Depreciation for land and building is to be made at the rate of 10% per annum on cost and for plant and machinery at 15% per annum on cost. (ii) Tax expense for the year is RM5,000. Applicable tax rate is 25%. (iii) The directors decided to: (a) transfer RM5,000 to General reserves; (b) pay preference dividend of 6 sen per share for the year; and (c) Recommend a dividend of 10 sen per share on Ordinary shares.
Question 3
The following
at 31 December 20X1:
Trial Balance as at 31 December 20X1 Dr Cr
RM RM
Capital – issued & fully paid:
60,000 Ordinary shares 60,000
20,000 non- redeemable
General reserves 14,000
Balance of
5% Debentures 50,000
Trade receivables and Trade payables 42,240 44,000
Cash at bank 35,000
Land and building at cost 100,000
Plant and machinery at cost 50,000
Inventories 31,000
Cash in hand 1,000
Land and building 20,000
Plant and machinery 7,500
Gross profit 145,000
Administrative expenses 44,000
Selling and distribution expenses 56,000
Discounts 500 1,540
Debenture interest 2,500
Legal fees 1,200
Directors’ fees 5,600
369,040 369,040
Required:
Prepare the Statement of Profit or Loss and an extract of the Statement of
Changes in Equity (showing the movements in retained earnings) for the year
ended 31 December 20X1 and the
taking into account the following additional information:
(i) Depreciation for land and building is to be made at the rate of 10% per
annum on cost and for plant and machinery at 15% per annum on cost.
(ii) Tax expense for the year is RM5,000. Applicable tax rate is 25%.
(iii) The directors decided to:
(a) transfer RM5,000 to General reserves;
(b) pay preference dividend of 6 sen per share for the year; and
(c) Recommend a dividend of 10 sen per share on Ordinary shares.
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