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Jingle Eng

Jingle Ltd's financial records for the year ended 31 December 2010 show a gross profit of R60,000 and a profit before tax of R45,500. The company's total assets increased to R255,000 from R211,500 in the previous year, with significant growth in non-current assets and equity. Additional information includes details on property, plant, equipment, and a dividend declaration of R5,760.

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18 views2 pages

Jingle Eng

Jingle Ltd's financial records for the year ended 31 December 2010 show a gross profit of R60,000 and a profit before tax of R45,500. The company's total assets increased to R255,000 from R211,500 in the previous year, with significant growth in non-current assets and equity. Additional information includes details on property, plant, equipment, and a dividend declaration of R5,760.

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kgomotsomahloko11
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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JINGLE LIMITED

The following information was extracted from the records of Jingle Ltd on their year ended
31 December 2010.

Jingle Ltd
Extract from the statement of profit or loss and other comprehensive
income for the year ended 31 December 2010.

R
Gross profit 60,000
Other income 2,500
Interest on fixed deposit 1,500
Profit on sale of equipment 225
Dividends from listed shares 775
Expenses (17,000)
Bank charges 1,000
Interest on mortgage bond 5,200
Loss on scrapping of vehicle 500
Depreciation 6,925
Other operating expenses 3,375
Profit before tax 45,500

Jingle Ltd
Statement of financial position as at 31 December 2010

2010 2009
R R
ASSETS
Non-current assets 189,500 154,000
Property, plant and equipment 156,800 137,000
Listed shares at cost 17,700 12,000
Fixed deposit 15,000 5,000
Current assets 65,500 57,500
Inventory 40,000 20,000
Debtors 25,000 35,000
Bank and cash 500 2,500
255,000 211,500

EQUITY AND LIABILITIES


Equity 140,000 103,000
Ordinary share capital 100,000 90,000
Retained earnings 40,000 13,000
Non-current liabilities
Mortgage bond 44,260 60,000

Current liabilities 70,740 48,500


Creditors 52,000 48,500
Taxation payable 12,740
Bank overdraft 6,000
255,000 211,500

1
Additional information:

1. Property, plant and equipment

Cost Cost Acc Dep'n Acc Dep'n Book value Book value
2010 2009 2010 2009 2010 2009
Land & buildings 106,000 96,000 106,000 96,000
Vehicles 50,000 45,000 14,500 25,000 35,500 20,000
Equipment 25,000 30,000 9,700 9,000 15,300 21,000
181,000 171,000 24,200 34,000 156,800 137,000

1.1 An old vehicle, on which the useful life has expired, had been scrapped on 1 January
2010. The cost price was R15 000 and accumulated depreciation R14 500. A new vehicle
was acquired on credit on 1 July 2010 from WV Motors at a cost of R20 000. The monthly
payment on this vehicle is R500 per month and the remaining balance owing to WV Motors
on 31 December 2010 is included under creditors. Depreciation on vehicles is calculated at
10% per annum on the straight line method.

1.2 No equipment was acquired during the year. Old equipment, with an accumulated
depreciation balance of R2 000 on 31 December 2009, was sold at a profit on 30 June 2010.
Depreciation on equipment is calculated at 15% per annum on the diminishing balance
method.

2. The listed investment consists of 8 850 ordinary shares of R2 each in NUW Ltd. The
market value of these shares is R23 000.

3. Gross profit percentage = 25%

4. A dividend of R5 760 was declared and paid on 31 December 2010.

5. Taxation expense for the year amounted to 28% on profit before tax.

REQUIRED:

Prepare the statement of cash flow, with notes, for the year ended 31 December 2010 in
accordance with IFRS. Use the direct method.

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