Solution 14.6 – Leisure Hotels Ltd

(a) Statement of Comprehensive Income for year ended 30 June

	€	€	€
Sales			590,000
Less cost of sales
Opening stock		10,000
Purchases		158,900
Less closing stock		(8,000)
Cost of sales			(160,900)
GROSS PROFIT			429,100
Add gains

Less Expenses
Directors remuneration		50,000
Wages	252,000
+ Wages due	5,000	257,000
Motor expenses		15,000
Rates & insurance	12,000
- Insurance prepaid	(3,000)	9,000
General expenses		20,000
Advertising		32,000
Auditing		10,000
Create provision bad debts		260
Annual depreciation - furniture		7,000
Annual depreciation - equipment		12,000	(412,260)
NET OPERATING PROFIT			16,840
Interest paid - trial balance		2,100
Interest due		12,900	(15,000)
Net profit before tax			1,840
Corporation tax paid
Corporation tax due			(3,500)
Net profit after interest and tax			(1,660)

(b) Statement of Equity Changes for year ended 31 March

	Ordinary shares	Pref Share	Share Prem	General reserve	Retained /accumulated profit	Total
	€			€	€	€
O/Balance	150,000	70,000	50,000	30,000	33,000	333,000
Profit after tax					(1,660)	(1660)
Dividend Ord					(5,000)	(5,000)
Dividend Pref					(4,900)	(4,900)
Transf to reserve				5,000	(5,000)
Issue of shares	50,000		87,500			137,500

C/Balance	200,000	70,000	137,500	35,000	16,440	458,940

Statement of financial position as at 30 June