- 20 Marks
FR – L2 – Q69 – Presentation of Financial Statements
Prepare Nova Bekasi Ltd's statement of profit or loss and financial position for 20X5 per IAS 1, considering inventory, depreciation, tax, and goodwill impairment.
Question
NOVA BEKASI LIMITED
The list of balances of Nova Bekasi Limited shows the following balances at 31 December 20X5.
| Dr GH₵’000 | Cr GH₵’000 | |
|---|---|---|
| Share capital (600,000 shares) | 320 | |
| General reserve | 20 | |
| Accumulated profit 1 January 20X5 | 50 | |
| Inventory (goods for resale) at 1 January 20X5 | 60 | |
| Revenue | 1,000 | |
| Purchases | 540 | |
| Purchases returns | 26 | |
| Sales returns | 28 | |
| Carriage outwards | 28 | |
| Warehouse wages | 80 | |
| Sales representatives salaries | 60 | |
| Administrative wages | 40 | |
| Warehouse plant and equipment – cost | 126 | |
| Accumulated depreciation – 1 January 20X5 | 50 | |
| Delivery vehicle hire | 20 | |
| Goodwill | 100 | |
| Distribution expenses | 10 | |
| Administrative expenses | 30 | |
| Directors’ salaries (charge to administrative expenses) | 30 | |
| Rental income | 16 | |
| Trade receivables | 330 | |
| Cash at bank | 60 | |
| Trade payables | 60 | |
| 1,542 | 1,542 |
Additional information
(1) Inventory (goods for resale) at 31 December 20X5 amounted to GH₵100,000.
(2) Annual depreciation on warehouse plant and equipment of GH₵32,000 should be provided.
(3) Income tax for 20X5 should be taken as GH₵50,000.
(4) The recoverable amount of goodwill was only GH₵90,000.
Required
Prepare the company’s statement of profit or loss for the year to 31 December 20X5 and a statement of financial position at that date in accordance with IAS 1 Presentation of Financial Statements.
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