Accounting 9706 · AS & A Level · Preparation of financial statements

Preparation of financial statements — practice question

On 1 January 2019, the equity of P Limited stood at $668{,}000$. For the year ended 31 December 2019, profit amounted to $120{,}000$. The following events also occurred during the year ended 31 December 2019: 1 April: an interim dividend of $40{,}000$ was paid 1 July: $50{,}000$ was transferred from retained earnings into general reserve 1 October: $5\%$ debentures worth $200{,}000$ were issued 31 December: a final dividend of $30{,}000$ was proposed What total equity did P Limited have at 31 December 2019?

  • A$698{,}000
  • B$718{,}000
  • C$748{,}000
  • D$948{,}000

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