Reference no: EM13938950

The following balances were extracted from the books of Ulinzi Insurance Company Ltd. As at 31 March 2000:

 

Debits

Sh.

Expenses of management:      Fire      Marine Claims paid:      Fire      Marine Commission:      Fire      Marine Directors' fees Depreciation on furniture Contribution to NSSF Investments Debentures on mortgage bank Interest accrued Shares in companies Premiums outstanding:      Fire      Marine Sundry debtors Fixed deposits Cash and bank balances Furniture less depreciation Library books   Credits Reserve for unexpired risks:      Marine      Fire Premium less reinsurance:      Fire      Marine Additional reserves:      Fire      Marine Claims outstanding on 1 April 1999:      Fire      Marine Interest on investments Miscellaneous receipts   Share capital: 210,000 ordinary shares Sh.100 each General reserve Staff provident fund Sundry creditors Contingency reserve Investment fluctuation reserve

579,000 258,000   840,000 805,500   522,000 370,500 130,500 6,000 22,500 18,886,500 4,402,500 54,000 4,230,000   1,056,000 894,000 289,5000 213,000 981,000 48,000 15,000   Sh.   1,830,000 976,500   2,479,500 1,677,000   1,071,000 112,500   28,500 1,500 385,500 1,500     21,000,000 1,917,000 213,000 900,000 300,000 210,000

            The following additional information is available:

 

            1.          Estimated liability in respect of claims outstanding at the close of the year was as follows:

                        Fire Sh.39,000                Marine Sh.141,000

 

            2.          The following provisions are to be made:

Sh.150,000 survey expenses for marine insurance claims

Sh.300,000 for taxation

 

An additional reserve of 10% of the net premium was made for the unexpired risks in the case of fire insurance in addition to the balance brought forward.

In respect of fire insurance, a reinsurance premium paid Sh.450,000, a claim of Sh.150,000 covered by insurance and a commission at 5% on reinsurance ceded have still to be accounted for.

The market value of the investments is Sh.21,375,000.

The reserve for unexpired risk should be 100% of the premium less reinsurance in marine business.

Required:

The revenue accounts and profit and loss account for the year ended 31 March 2000 and a balance sheet as at that date.