The following trial balance was taken from the books of Rainbow plc as at 31 December 2011:
|
|
£m
|
£m
|
|
Retained profit at 1 January 2011
|
|
30
|
|
Sales
|
|
1,200
|
|
Purchases
|
500
|
|
|
Inventories at 1 January 2011
|
400
|
|
|
Rent and rates
|
90
|
|
|
Salaries and wages
|
80
|
|
|
Other expenses
|
50
|
|
|
Freehold land at cost
|
900
|
|
|
Plant and machinery at cost
|
350
|
|
|
Motor vehicles at cost
|
90
|
|
|
Accumulated depreciation:
Plant and machinery
Motor vehicles
|
|
140
50
|
|
Trade receivables
|
120
|
|
|
Other receivables
|
80
|
|
|
Cash
|
150
|
|
|
Trade payables
|
|
50
|
|
Other payables
|
|
30
|
|
10% Debentures
|
|
500
|
|
Debenture interest paid
|
25
|
|
|
Ordinary share capital of £1 each
|
|
700
|
|
Share premium
|
|
140
|
|
Interim dividends paid
|
5
|
|
|
|
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|
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|
|
|
2,840
|
2,840
|
|
|
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|
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|
The following additional information became available to you:
1. Inventories as at 31 December 2011 are valued at £300m.
2. Annual rent and rates is £120m.
3. Salaries and wages include £15m advance payments.
4. The annual depreciation on plant and machinery, and motor vehicles has not been charged. The company depreciates plant and machinery at 20% using the straight-line method and motor vehicles at 25% using the reducing-balance method.
5. A trade debtor owing £20m to the company has been declared bankrupt.
6. A provision of doubtful debts has to be made at 15% of the remaining trade receivables.
7. The remaining debenture interest has not been paid yet.
8. The freehold land was re-valued at £1,050m. The directors decided to reflect this in the accounts.
9. Taxation for the year is estimated to be £60m and has not been paid yet.
10. No final dividends have been declared.
Required: Prepare a Statement of Comprehensive Income for the year ended 31 December 2011 and a Statement of Financial Position as at that date in a form suitable for publication, so far as the information given allows.