Prepare the statement of profit or loss

Assignment Help Financial Accounting

Reference no: EM131161588

Question :-
Hafeni Limited changed its inventory valuation method from weighted average method to FIFO as this will result in fairer presentation as the matching of revenue and expenses will be improved.
The effect of the change is as follows:

Year-end inventory balances

2015

2014

2013

2012

Weighted average method (old method)

15 000

14 000

12 000

10 000

FIFO method (new method)

18 000

15 000

14 000

11 000

The draft financial statements before the change in accounting policy are as follows:

HAFENI LIMITED DRAFT STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2015
	2015 N$	2014 N$
Revenue	1 200 000	900 000
Cost of sales	(420 000)	(350 000)
Gross profit	780 000	550 000
Other costs	(220 000)	(200 000)
Profit before tax	560 000	350 000
Income tax expense	(235 200)	(136 500)
Profit for the year	324 800	213 500
Other comprehensive income for the year	-	-
Total comprehensive income for the year	324 800	213 500

HAFENI LIMITED DRAFT STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2015
	Retained earnings N$
Balance: 1/1/2014	67 500
Total comprehensive income: 2014	213 500
Balance: 31/12/2014	281 000
Total comprehensive income: 2015	324 800
Balance : 31/12/2015	605 800

REQUIRED

Prepare the statement of profit or loss and other comprehensive income, statement of changes in equity, statement of financial position and the relevant notes of Hafeni Limited for the year ended 31 December 2015 in accordance with International Financial Reporting Standards.

Reference no: EM131161588

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