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

Preparation of financial statements — practice question

D Limited sells sports equipment. The balances below were taken from the books of account at 31 December 2018.
(a)[13]

Prepare the income statement for the year ended 31 December 2018. Put your workings in the space on the next page.

(b)[3]

Prepare an extract that shows only the current assets section of the statement of financial position at 31 December 2018.

(c)[5]

Prepare a statement for the directors showing the total value of equity at 31 December 2018.

(d)[5]

Advise the directors which option they ought to select. Support your answer.

(e)[4]

Explain two ways in which a bonus issue of shares differs from a rights issue of shares.

Worked solution & mark scheme

This 30-mark question has a full step-by-step worked solution and mark scheme. One marking point: Revenue is 5080

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