Reference no: EM132519516

Cubic Ltd, a transport company, generated revenues from the provision of services for the financial year ended 30 June 2017 of $3.5 million. In addition, the following transactions and events occurred during the year.

1. Plant and equipment was purchased for $600 000.
2. Depreciation using the straight-line method was $400 000.
3. On 31 August 2015, the company entered into a non-cancellable lease agreement with A-Z Ltd to acquire a number of additional trucks. For 2016/2017 the total monthly lease payments, which are made in advance, amounted to $100 000. The lease agreement was for a period of five years and the implicit rate of interest was 1.6% per month. There is no residual value.
4. On 1 April 2017, Cubic purchased, for $1 million, a small transport company with net assets (including $26 000 goodwill) that had a book value of $700 000 and a fair market value of $826 000.
5. The company's bad debt expense for 2016/2017 was $260 000.

Other expenses were as follows:

1. Wages and salaries$800 000Electricity100 000Rates50 000Selling expenses200 000Administrative expenses400 000Other expenses80 000
2. During the year the company sold, at a non-taxable profit of $1 million, land no longer required for business operations.
3. On 1 January 2017, the company revalued its buildings by $600 000.
4. Dividends paid on 1 April 2017 were $800 000.
5. Income tax expense for the year ended 30 June 2017 was $394 276.
6. Balance of retained earnings on 1 July 2016 was $1 301 577.

Required

Question 1: Prepare astatement of comprehensive income and statement of changes in equity for Cubic for the year ended 30 June 2017 in accordance with accounting standards. Explain any assumptions you make and show all calculations.