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The following is the trial balance of Eskimo Limited at 31 December 20X8 Eskimo Limited Trial Balance at 31 December 2018 Debit Credit Retained earnings

The following is the trial balance of Eskimo Limited at 31 December 20X8:

Eskimo Limited

Trial Balance at 31 December 2018

Debit Credit

Retained earnings (1/1/2018) 145 000

Non-current liabilities: Loan from AB Bank 25 000

Revaluation surplus (1/1/2018) 20 000

Ordinary share capital 240 000

Revenue: Sales 580 000

Interest income 12 500

Rent income 23 000

Cost of sales 300 000

Interest on bank overdraft 9 500

General expenses 113 000

Bad debts expense 20 000

Repairs and maintenance expense 30 000

Marketing expense 22 000

Fuel expense 40 000

Depreciation expense 25 000

Salaries 50 000

Investments in listed companies 50 000

Accounts receivable 250 000

Bank 23 000

Current tax payable 12 800

Inventories 120 000

Accounts payable 225 000

Land 200 000

Equipment: Cost 100 000

Equipment: Accumulated depreciation 40 000

Income tax expense 1 800

Dividends 15 000

1 346 300 1 346 300

Additional information:

· Share capital constitutes 120 000 ordinary shares of no par value. 20 000 shares were issued for N$40 000 on the first day of the year.

· The interest and rental income are incidental to main business operations.

· Eskimo Limited classifies expenses according to their function. Management categorise the functions of the business into the areas of sales, administration and distribution.

- Salaries of N$30 000 relate to the administrative function and N$20 000 to the distribution function.

- Depreciation on equipment of N$10000 relates to the administrative function and N$15 000 to the distribution function.

- The bad debts and marketing expenses relate to the administration function.

- The repairs and maintenance and fuel expenses relate to the distribution function.

· Dividends of N$15 000 in respect of the year ended 31 December 2017 were declared and paid during January 2018. Dividends of N$20 000 in respect of the year ended 31 December 2018 were declared on 15 January 2019.

· There are no movements in other comprehensive income.

Required:

a) Prepare the statement of comprehensive income of Eskimo Limited for the financial year ended 31 December 2018 in accordance International Financial Reporting Standards.

b) Prepare the statement of financial position of Eskimo Limited at 31 December 2018 in accordance with International Financial Reporting Standards.

May 17 2020 View more View Less

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