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Azaraza Sdn Bhd

Question 1 Stmt of Comp Inc for the year ended 31 May 2008RM’000 RM’000 RM’000

Sales 11,476

Less : Returns inwards (249) 11,227Less : Cost of sales

Opening inventories 1,294

Purchases 9,726

Less : Return outwards (341) 9,385

10,679

Less : Closing inventories (1,471) (9,208)

Gross Profit 2,019

Add: IncomeDiscount received 8

Interest received 4 12

2,031Less : Expenditure

Heat & light 28

Building insurance 16

Telephone 12

Postage 8Discounts allowed 14

Stationery 23

Bad debts written off 274

Warehouse rent [45 - (30 x 6/12 mths)] 30Wages & salaries 97

Staff bonus 23

Motor expenses (43 + 5) 48

Interest (164 + 12) 176Inc. in prov. for doubtful debts(142-

93)

49

Depn : Motor vehicles [(78 -34) x 25%] 11

Depn : office equipment [(47-15 x25%] 8Depn : furniture (25 / 5 years) 5 (822)

 Net Profit before tax 1,209

Less : Tax (210)

Profit for the year 999

Azaraza Sdn Bhd

Working Notes on the Appropriation of Profits for the year ended 31 May 2008

RM’000 RM’000Profit for the year 999

Less : Appropriation

Interim dividend paid 10

Proposed final dividend (1,000,000 x RM1 x 6%) 60 (70)

929

Retained profits b/d 550

Retained profits c/d 1,479

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Question 2

F W Sdn Bhd

Statement of Comprehensive Income for the year ended 31 Dec 2008RM RM RM

Sales 98,200

Less : Cost of sales

Opening inventories 22,690Purchases 53,910

Add : Carriage inwards 1,620 55,530

78,220

Less : Closing inventories (27,220) (51,000)

Gross profit 47,200

Less : ExpenditureSalaries & wages 9,240

Motor expenses 8,120

Rates & insurances 2,930

General expenses 560

Directors’ remuneration 6,300Debenture interest 3,000

Depreciation : Motor vehicles 3,000

Depreciation : Equipment 1,200 (34,350)

 Net profit before tax 12,850

Less : Tax (5,000)

Profit for the year 7,850

F W Sdn Bhd

Working Notes on the Appropriation of Profits for the year ended 31 Dec 2008

RM RM RMProfit for the year 7,850

Less : Appropriation

Transfer to general reserves 5,000

Interim dividend paid: Ordinary shares 3,500Proposed final dividends:

- Preference shares (20,000 x RM1 x 10%) 2,000

- Ordinary shares (70,000 x RM1 x 10%) 7,000 9,000 (17,500)

(9,650)Retained profits b/d 16,940

Retained profits c/d 7,290

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F W Sdn Bhd

Statement of Financial Position as at 31 Dec 2008

RM RM RM

 Non- current assets

Building, at cost 110,500Equipment, at cost 8,000

Less: Accum. Depreciation (2,400 + 1,200) (3,600) 4,400Motor vehicles, at cost 17,200

Less: Accum. Depreciation (5,160 + 3,000) (8,160) 9,040 123,940

Current assets

Inventories 27,220

Trade Receivables 18,610

Cash at Bank 8,390

54,220

Less : Current liabilities

Trade payables 11,370

Accrued dividends 9,000

Debenture interest payable 1,500

Provision for taxation 5,000 (26,870) Net current assets 27,350

151,290

Financed by:Authorised share capital

20,000 10% Preference shares of RM1 each 20,000

100,000 Ordinary shares of RM1 each 100,000

120,000

Issued share capital

20,000 10% Preference shares of RM1 each 20,000

70,000 Ordinary shares of RM1 each 70,000

90,000

ReservesShare premium 14,000

General reserve (5,000 + 5,000) 10,000

Retained profits 7,290 31,290

Shareholders’ equity 121,290

 Non-current liabilities

10% Debentures (repayable 2012) 30,000

151,290

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Extra exercise questions (for students’ own practice)

Question 3

ABL Sdn BhdStatement of Comprehensive Income for the year ended 31 Dec 2008

RM RM

Gross Profit 145,000

Add : IncomeDiscount received 1,540

146,540

Less : Expenditure

Administrative expenses 44,000Selling and distribution expenses 56,000

Discount allowed 500

Debenture interest 2,500

Legal fees 1,200Directors’ fee 5,600

Depreciation : Land & buildings (100,000 x 10%) 10,000

Depreciation : Plant & machinery (50,000 x 15%) 7,500(127,300)

 Net profit before tax 19,240

Less : Tax (5,000)

Profit for the year 14,240

ABL Sdn Bhd

Working Notes on the Appropriation of Profits for the year ended 31 Dec 2008

RM RM

Profit for the year 14,240Less: Appropriation

Transfer to general reserve 5,000

Preference share dividend (20,000 x RM1 x 6%)x 75% 900

Ordinary share dividend (60,000 x RM1 x 10%)x 75% 4,500

(10,400)

3,840Retained profits b/d 7,000

Retained profits c/d 10,840

ABL Sdn Bhd

Statement of Financial Position as at 31 Dec 2008RM RM RM

 Non-current assets

Land & building, at cost 100,000

Less: Accum. Depreciation (30,000) 70,000

Plant & machinery, at cost 50,000

Less: Accum. Depreciation (15,000) 35,000

105,000

Current assets

Inventories 31,000

Trade Receivables 42,240Cash at Bank 35,000

Cash in Hand 1,000

109,240

Less : Current liabilities

Trade payables 44,000Provision for tax 5,000Accrued dividend: Pref. Shares 900

Accrued dividend: Ord. Shares 4,500 (54,400)

 Net current assets 54,840

159,840

Financed by:Authorised & issued share capital

60,000 Ordinary shares of RM1 each 60,000

20,000 6% Preference shares of RM1 each 20,000

80,000Reserves

Share premium 4,000

General reserve (10,000 + 5,000) 15,000

Retained profits 10,840

29,840

109,840

  Non-current liabilities

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5% Debentures 50,000

159,840

Question 4 

Falta Ltd

Statement of Comprehensive Income for the year ended 30 April 2005

£ £ £Sales 880,426

Less: Returns inwards (18,400) 862,026

Less: Cost of goods sold

Opening inventories 102,994

Purchases 419,211

Add: Carriage inwards 1,452 420,663

523,657

Less: Closing inventories (111,317) (412,340)

Gross profit 449,686

Less: Expenditure

Loan note interest (1,600 + 1600) 3,200Wages and salaries 123,289Rent, rates & insurance (16,240 + 802) 17,042

Discounts allowed 3,415

Directors’ remuneration (82,400 + 6,000) 88,400

Depn: Equipment (225,000 x 20%) 45,000Depn: Motor vehicles (57,200 x 25%) 14,300 (294,646)

Profit for the year 155,040

Falta Ltd

Working Notes on the Appropriation of Profits for the year ended 30 Apr 2005

£ £ £Profit for the year 155,040

Less: Appropriation

Proposed final dividends:

- Ordinary shares (300,000 x £0.50 x 18%) 27,000- Preference shares (50,000 x £1 x 12%) 6,000 33,000

Transfer to general reserve 5,000Transfer to non-current assets replacement reserve 10,000 (48,000)

107,040

Retained profits b/d 12,411

Retained profits c/d 119,451

Falta Ltd

Statement of Financial Position as at 30 April 2005

£ £ £ Non-current assets

Equipment at cost 225,000

Less: Accum. Depreciation (32,600+45,000) (77,600) 147,400

Motor vehicles at cost 57,200

Less: Accum. Depreciation (18,200+14,300) (32,500) 24,700 172,100

Current assets

Inventory 111,317

Trade receivables 227,219Bank 4,973

Cash 62

343,571Less: Current liabilities

Trade payables 54,818

Accrued dividends 33,000Accrued expenses (802 + 6,000 + 1,600) 8,402 (96,220)

 Net current assets 247,351

419,451

Financed by:

Issued capital

300,000 Ordinary shares of 50p each 150,00050,000 12% Preference shares of £1 each 50,000

200,000Reserves

General reserve (15,000 + 5,000) 20,000 Non-current assets replacement reserve (30,000+10,000) 40,000

Retained profits 119,451 179,451

 Non-current liabilities8% loan notes 40,000

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419,451