ACCT2015 Marathon

Past Paper 2014 Solution

Ricketts Accounts Tutoring Service
A)
Paul Limited
Statement of Comprehensive Income
For year ended December 31, 2014
$
Revenues 90,520
Less: Cost of Goods Sold (51,248)
Gross Profit 39,272
Add: Other Operating Income (8600+500) 9,100
48,372
Less: Operating Expenses
Administrative Expenses (7150)
Distribution Costs (10,100)
Other Operating Expenses 0
Operating Profit 31,122
Less : Finance Cost (10/100 x 10,000) (100)
Profit before tax 30,122
Corporation Tax 11,001
Net Income 19,121
 Paul Limited
Statement of Changes in
Equity
For year ended December 31, 2014
Ordinary General Reva Retained Total
Share Reserve luati Earnings $’000
$’000 $’000 on $’000
Surpl
us
As at 18,000 2,000 3,525 23,525
January 01,
2014
Net Income 19,121 19,121
Dividends (1800) -1800
declared
Dividends (3600) -3600
paid
Revaluation 240 240
Transfer to 800 (800) 0
reserves
As at 18,000 2,800 240 16,446 37,486
December
31, 2014

C)

Paul Limited
Statement of Financial Position
As at December 31, 2014
$’000
Non-Current Assets
Property, plant and Equipment 14,500
Long Term receivables 6000
Investment Property 9800
Total Non-Current ASSETS 30,300
Current Assets
Closing Inventory 5222
Current portion of receivables 3,000
Trade Debtors 15,700
Cash and bank (90,725-125) 8210
Total Current Assets 32,132
Total Assets 62,432

Equity and Liabilities

Equity
Ordinary Share 18,000
General Reserve 2,800
Reval Surplus 240
Retained Earnings 16,446
Total Equity 37,486

Non-Current Liabilities
Long term loan 5,000
Deferred Tax payable 676

Current Liabilities
Trade Creditors 1780
Corporation tax payable 10,440
Current Portion of long term loan 5000
Interest payable 250
Dividend payables 1400
Total Current Liabilities 19,270
Total equity and liabilities 62,432
D)

Paul Limited

Taxation Note

Income tax is computed at 25% of the profit for the year adjusted for tax purposes. The change for
taxation comprises for year ended December 31, 2014

Income Tax @ 25% 10,400

Over Provision (30)

Deferred Tax provision 91

Div/Investment Income 500

11,001
 Corporation Tax payable
Deferred Tax 91 Income Statement 11,001
Dividend Income 500 Over-Provision 30
Bal c/d 10,440
11,031 11,031

E)