Question

Gun Ning Limited recorded the following operational income and expenses for the year ended 30 June 2014.

	$
Revenue (Sales)	7,600,000
Cost of sales	2,600,000
Other income:
Commission received	300,000
Interest received	100,000
Other expenses:
Distribution expenses	800,000
Marketing expenses	600,000
Occupancy expenses	1,500,000
Administration expenses	1,300,000
Other expenses	360,000
Finance cost expenses	240,000

Additional information:

(1) Income tax rate is 30%.

(2)    Administration expenses included:

(i) Audit fees   $50,000

(ii) Fees paid to auditors for taxation services   $24,000

(iii) Depreciation of plant & equipment   $90,000

(3)      Other expenses included a loss on sale of plant & equipment. $30,000

(4)    Share capital at 1 July 2013 was 6,000,000 ordinary shares of $1.00 each, fully paid.

(5)    Retained earnings balance 1 July 2013. (debit) $110,000

(6)      Dividend equalisation reserve 1 July 2013 $700,000

(7)    Transferred during year to retained earnings from dividend equalisation reserve $500,000

(8)      Asset revaluation reserve balance 01 July 2013   $300,000

(9)      The directors adopted a revaluation of land on 01 June 2014. The land had a book value of $960,000 and was revalued to $1,100,000.

(10)    An interim dividend of $0.0375 per ordinary share was paid on 29 February 2014.

(11)    The directors declared a final dividend of $0.045 per ordinary share on 30 June 2014.

Required:

Prepare a Statement of Comprehensive Income with both expenses (classified by function) and revenues disclosed on the face of the statement.

Prepare a statement of changes in equity disclosing all movements on the statement.

Prepare the following notes to support the Statement of Comprehensive Income and Statement of Changes in Equity:

(i) Profit for the period

(ii) Dividends

(iii) Reserves

Use the following format:

Statement of Comprehensive Income for the year ended 30 June 2014
Revenue (sales)
Gross Profit
Profit after Tax
Other comprehensive income
Total other comprehensive income
Total comprehensive income

Statement of changes in equity For the year ended 30 June 2014
	Reserves			Share Capital	Total equity
	Retained Earnings	Dividend Equalisation Reserve	Asset Revaluation Reserve
Balance 1 July 2013
Comprehensive income for the period
Transfers to/from reserves
Transactions with owners
Dividends
Share buy-back
Issue of share capital
Total transactions with owners
Balance 30 June 2014

Profit for the period

Profit has been determined after charging/crediting the following items:
	$'000	$'000

Dividends

           

                                               

Reserves:
Movement in reserves:

Answer 1