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

Preparation of financial statements — practice question

The following data relate to a limited company for the financial year ending on 31 December. total equity on 1 January $492000 profit for the year $70500 dividends paid $24000 dividends proposed $12000 On 30 June, a bonus issue of 20000 ordinary shares of $1 each was made. On 31 December, these decisions were taken. 1 The buildings are to be revalued to $250000. Their original cost was $200000 and accumulated depreciation stood at $50000. 2 A transfer of $5000 is to be made to the general reserve. Calculate the total equity on 31 December after these adjustments have been made.

  • A$588500
  • B$613500
  • C$618500
  • D$638500

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