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

Preparation of financial statements — practice question

J plc’s company accountant had drawn up draft financial statements for the year ended 30 June 2024. These balances were still left in the accounting records. The draft statement of profit or loss reported profit for the year of $83\,250$. It was then found that a number of errors and omissions had been ignored.
(a)[2]

Calculate the corrected carrying value of Property at 30 June 2024.

(b)[7]

Calculate the adjusted profit for the year ended 30 June 2024.

(c)[10]

Prepare the statement of financial position at 30 June 2024. Use the space on page 5 to show your workings.

(d)[2]

State two further factors that may cause the value of plant and equipment to depreciate.

(e)[2]

State the formula for each ratio below.

(f)[7]

Advise the directors which option they should choose. Support your advice by weighing both financial and non-financial factors.

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