Reference no: EM132331580

Question :

The following has been extracted from the trial balances of Treasure Ltd for the last two years:

	2019 ($'000)	2018 ($'000)
Sales (all on credit)	5,250	1,500
Cost of goods sold	2,730	780
Doubtful debts expense	525	150
Interest expense	420	120
Salaries	630	180
Depreciation	210	60
Gain on sale of plant	185	30
Cash	3,264	794
Inventory	3,780	1,080
Accounts receivable	5,600	1,600
Allowance for doubtful debts	560	160
Land	3,150	20
Plant	2,100	900
Accumulated depreciation	490	600
Bank overdraft	4,890	140
Accounts payable	4,280	80
Accrued salaries	462	1,200
Long-term ban	2,240	132
Share capital	2,800	640
Dividends paid	190	800
Retained earnings		1,442

Additional infonnation:

- plant with a carrying value of $110 000 (original cost $400 000 and accumulated depreciation of 53200,000) was sold during the year.

- new plant and new land were acquired during the year

Required:

(a) Prepare an Income Statement for the year ending 30 June 2019 (usc the space available on page 4)

(b) Calculate the closing balance of retained earnings as at 30 June 2019 (usc the t-account on page 4)

(c) Prepare a Statement of Financial Position as at 30 June 2019, showing comparative information for the prior year (use the space available on page 5)

(d) Prepare a Statement of Cash Flows (and reconciliation of profit to operating cash flows) for the year ending 30 Junc 2019, showing all workings (usc the space available on page 6 for the t-accounts and the space available on pages 7 and 8 for the Statement of Cash Flow and supporting notes)