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QUESTION SIX Cayman prepares annual financial statements to 30 September. At September 30, 2022, the companys list of account balances was as follows: DR TZS000 CR TZS000 Revenue 7,400,000 Production costs 4,140,000 Inventory at October 1, 2021 695,000 Distribution costs 540,000 Administrative expenses 730,000 Loan interest expense 120,000 Land at valuation 5,250,000 IAA MAF 2023 CORPORATE REPORTING (AFG 09214) IAA MAF-2023 Page 6 Buildings Cost 4,000,000 Buildings accumulated depreciation at October 1, 2021 1,065,000 Plant and equipment Cost 6,400,000 Plant and equipment Acc. depreciation at October 1, 2021 1,240,000 Trade accounts receivable 2,060,000 Trade accounts payable 1,120,000 Bank overdraft 40,000 Issued shares (50 cent ordinary) at September 30, 2022 7,000,000 Share premium account at September 30, 2022 2,000,000 Revaluation surplus 1,500,000 Retained earnings 1,570,000 12% loan (payable 2029) - 1,000,000 23,935,000 23,935,000 The following matters are relevant to the preparation of the financial statements for the year ended September 30, 2022: (1) Inventory at September 30, 2022 amounted to TZS 780,000,000 at cost before adjusting for the following: (i) Items which had cost TZS 40,000,000/= and which would normally sell for TZS 60,000,000/= were found to be faulty. TZS 10,000,000/= needs to be spent on these items in order to sell them for TZS 45,000,000/=. (ii) Goods sent to a customer on a sale or return basis have been omitted from inventory and included as sales in September 2022. The cost of these items was TZS 8,000,000/= and they were included in revenue at TZS 12,000,000/=. The goods were returned by the customer in October 2022. (2) Depreciation is to be provided on cost as follows: Buildings: 2% per year Plant and equipment: 20% per year 80% of the depreciation is to be charged to cost of sales and 10% to each of distribution costs and administrative expenses. (3) Land is to be revalued to TZS 5,000,000,000/= (4) Accrued expenses and prepayments were: Accrued expenses Prepayments TZS000 TZS000 Distribution costs 95,000 60,000 IAA MAF 2023 CORPORATE REPORTING (AFG 09214) IAA MAF-2023 Page 7 Administrative expenses 35,000 30,000 (5) During the year 4 million ordinary shares were issued at TZS 750 each. The directors of Cayman declared an interim dividend of TZS 20/= per share in September 2022. No dividends were paid during the year. (6) Loan interest is paid annually, in arrears, on September 30 each year. Required: Prepare for Cayman for the year ended September 30, 2022: (a) a statement of total comprehensive income; (b) a statement of financial position; and (c) a statement of changes in equity, Note: The above financial statements should be presented in accordance with IAS 1: Presentation of Financial Statements.

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