BM12 Revision: Balance Sheet + Profit & Loss

Individually, complete the following problems on a separate sheet of

paper. Make sure to show your work. You may use a calculator.
If you finish early, start reading* on Investment Appraisal: Payback
Period on p. 310-312 in Hoang
Cash
0.1
or in Mr. Slaughters BM Blog.
Creditors
0.8
http://goo.gl/lOYbHW
Debtors
0.2
Fixed assets equipment
1.5
For homework, take notes
Fixed assets land and buildings
9
on Payback Period. I will check
Loan capital
4
these next class because Id
Retained profit
2
like to offer tips on how to
Share capital
4
strengthen note-taking.

PART ONE:
Miley Co. Profit & Loss
For the year 2010, Miley Co. generated average monthly revenues of
$125,000. This was achieved by pricing the goods with an average
mark up of 50% of total direct costs.
The companys expenses for the year included:
Advertising
$
50,000
Salaries
$100,000
Interest payable $ 15,000
Rent
$ 75,000
Utilities
$ 25,000
Taxes
$ 45,000
From the net profits, the company retained 50% and paid out the
balance as dividends to shareholders.
HL & SL: Prepare a profit and loss account for Miley Co. for 2010.

PART TWO:
Bieber Co. Balance Sheet
Selected financial information from Bieber Co. accounts as at
3l March 2014 (all figures in US$m)

1) HL & SL: Using the information provided, prepare a balance

sheet for Bieber Co. as at 31 March 2014.
2) HL: Using the reducing balance method of depreciation at a
rate of 40% per year, calculate the total depreciation charge on
the equipment purchased three years ago (show all your
working).
3) HL: Prepare Bieber Co.s new balance sheet as at 31 March
2014, taking into account the depreciation charge calculated in
no. 2.