Case study 3:

The general ledger trial balance of Hasaki company includes the following accounts
at 31 December 2021:

Additional information
• A revaluation gain of $150,000 net of tax was recognised for available-for-sale
investments held during 2021.
• A loss of $12,000 net of tax was recognised on the revaluation of land.
• A loss on property revaluation was $75,000
• Exchange differences on translating foreign operations was $36,000
• No available-for-sale investments were sold during the year.
• Hasaki company uses the single statement format for the statement of profit or loss and
other comprehensive income and classifies expenses by function.
Required
Prepare the statement of profit or loss and other comprehensive income of Hasaki company
for the year ended 31 December 2021, showing the analysis of expenses in the statement.
Sale revenue 2,550,000
Cost of sales (2,100,000)
Gross profit 450,000
Other income 120,000
Selling and distributions expenses (150,000)
Administrative expenses (90,000)
Finance costs (45,000)
Profit before tax 285,000
Income tax expense (30,000)
Profit for the year 255,000
Other comprehensive income:
Items that will not be reclassified subsequently to profit or loss
Gain on valuation of available-for-sale investments 150,000
Loss on valuation of land net of tax (12,000)
Loss on property revaluation (75,000)
Exchange differences on translating foreign operations (36,000)
27,000
Total comprehensive income for the year 282,000 (255,000+27,000)

Other income comprise:

+ Gain on sale of plant 30,000
+ Interest revenue 75,000
+ Dividend revenue 15,000
120,000