Trial Balance For Ocean: Preparing Income Statement, Changes In Equity And Financial Position
| Trial Balance | Amount ($000) | Amount ($000) |
| Revenue | 2,45,000.00 | |
| Cost of sales | 1,45,300.00 | |
| Distribution Cost | 16,750.00 | |
| Adminstrative Expenses | 18,400.00 | |
| Dividends paid | 5,440.00 | |
| Bank Intererst | 450.00 | |
| Loan | 1,250.00 | |
| leased Property | 50,000.00 | |
| Plant and equipment | 77,750.00 | |
| Depreciation | ||
| Leased property | 12,500.00 | |
| Equipment | 21,750.00 | |
| Inventory | 30,500.00 | |
| Trade Receivables | 31,500.00 | |
| Trade Payables | 16,100.00 | |
| Bank | 2,250.00 | |
| Share Capital | 40,500.00 | |
| Retained earnings | 13,540.00 | |
| 5% convertible loan | 25,000.00 | |
| Income tax | 1,600.00 | |
| Deferred Tax | 2,300.00 | |
| Total | 3,78,940.00 | 3,78,940.00 |
i. Revenue includes an amount of $10 million for cash sales made through Ocean’s retail outlets during the year on behalf of Outdoor Extreme. Ocean, acting as agent, is entitled to a commission of 15% of the selling price of these goods. By 31 March 2017, Ocean had remitted to Outdoor Extreme $7.5 million (of the $10 million sales) and recorded this amount in cost of sales.
1,500.00
ii. Plant and equipment is depreciated at 10% per annum on the reducing balance basis. All amortization / depreciation of non-current assets is charged to cost of sales.
37,500.00,56,000.00
iii. The balance on income tax represents the under/over provision of the tax liability for the year ended 31 March 2016. A provision of $14 million is required for tax for the year ended 31 March 2017 and at this date the deferred tax liability was assessed at $4·15 million.
iv. The weighted average of number of shares during financial year ended 31 March 2017 is 105 million.
| Income Statement Amount | |
| Revenue | 2,45,000.00 |
| less: Cost of sales | 1,47,150.00 |
| Gross Profit | 97,850.00 |
| Add: Commission Received | 1,500.00 |
| less: Distribution Cost | 16,750.00 |
| Less: adminstrative expenses | 18,400.00 |
| PBIT | 64,200.00 |
| Less: Loan note interest | 1,250.00 |
| Less: Bank Interest | 450.00 |
| Net Profit | 62,500.00 |
| Statement of Changes in Equity | |
| Share Capital | 40,500.00 |
| Retained Earnings (Opening Balance) | 13,540.00 |
| Net profit | 62,500.00 |
| Less: Dividend paid | 5,440.00 |
| Less: Provision for Tax | 14,000.00 |
| Total Equity (31-March-18) | 97,100.00 |
| Statement of Financial Position | |
| Current assets | |
| Bank | 250.00 |
| Inventory | 30,500.00 |
| Trade receivables | 31,500.00 |
| Total Current Assets | 62,000.00 |
| Fixed Assets | |
| Leasehold Property | 50,000.00 |
| less: Accumulated Depreciation | 16,250.00 |
| Equipments | 77,750.00 |
| Less: Accumulated depreciation | 25,350.00 |
| Total Fixed Assets | 86,150.00 |
| Total Assets | 1,48,150.00 |
| Current Liablities | |
| Trade Payables | 8,600.00 |
| Long term Liablities | 25,000.00 |
| Provision for Tax | 14,000.00 |
| Deferred tax Liablity | 1,850.00 |
| Total liablities | 49,450.00 |
| Owner’s Equity | |
| Common Stock | 40,500.00 |
| Retained Earnings | 58,200.00 |
| Total Liablities and owner’s Equity | 1,48,150.00 |
| Calculation of EPS | |
| Revenue | 2,45,000.00 |
| less: Cost of sales | 1,47,150.00 |
| Gross Profit | 97,850.00 |
| Add: Commission Received | 1,500.00 |
| less: Distribution Cost | 16,750.00 |
| Less: adminstrative expenses | 18,400.00 |
| PBIT | 64,200.00 |
| Less: Loan note interest | 1,250.00 |
| Less: Bank Interest | 450.00 |
| Net Profit | 62,500.00 |
| Less: Dividend | 5,440.00 |
| EAES | 57,060.00 |
| ÷No. of shares outstanding | 105000 |
| EPS | 0.54 |