natgoon

I need urgent help for this work. I don't know how to answer this question below. Really appreciate your help and feedbacks.

ABC Berhad is a retailer of electrical goods and home furniture. The firm's adjusted trial
balance for the year ended 31 December 2009 is reproduced below.

Additional information:

a. The balances reported on the firm's adjusted trial balance incorporate all relevant
transactions for the period and balance date adjusting entries.

b. Advice from the firm's auditors indicates that:
- A classification based on the function of expenses within the entity would be the
most appropriate expense classification for the firm to use on the face of its
statement of comprehensive income; and
- A single statement approach would be the best method of presenting the firm's
statement of comprehensive income.

c. Accounts receivable included a long-term loan of RM850,000 provided to one of
the firm's directors which is payable on 20 January 2012.

d. During the period, a RM0.7 million revaluation increment (net of tax) was
recognised on the firm's available for sale financial assets.

e. Relevant information in relation to the firm's property, plant and equipment is
provided below:
- The buildings sold had an original cost of RM5.0 Million and an accumulated
depreciation balance of RM1.9 Million when sold;
- During the period, land was revalued upwards by RM2.1 Million (net of tax).
The revaluation was carried out by a licensed revaluer who used fair values as
the basis for the revaluation;
- During the period, new buildings worth RM3.0 Million were constructed and
new machinery worth RM800,000 was acquired; and
- The firm's buildings and land were pledged as security for the debentures issued
by the company.

f. Additional goodwill of RM4.1 Million was recognised during the period following
the acquisition of a new subsidiary.

g. Provisions included an:
- RM8 Million provision for warranty claims (the firm offers extended warranty
periods on all products sold); and
- RM3.25 Million provision for employee entitlements (i.e. annual and longservice
leave).
- 40% of the warranty claims and 20% of the total employee entitlements are
expected to be paid within the next 12 months.

h. The firm complies with the requirements of FRS 112 and the difference between
the firm's current tax liability and current tax expense is because of the movements
in the deferred tax asset and liability accounts.

i. The terms of the firm's mortgage agreement stipulate that it is required to make
minimum annual principal repayments of RM2.0 Million.

j. The firm's share capital includes 36 million ordinary shares fully paid to RM1.00.
An additional 5 Million share were issued during the period. Shareholders receive
one vote per share held.

k. The 'other expenses' identified in the adjusted trial balance included payments of
RM1.7 Million to the firm's auditor for:
- The conduct of the audit of the firm's financial statements (RM1.1 Million); and
- Other general accounting policy advice (RM600,000).

l. A dividend of RM1.4 was declared on 31 December 2009. The retained earnings
balance reported on the adjusted trial balance reflects the declaration of this
dividend.

m. Expenses recognised on the adjusted trial balance included:
RM
Depreciation on buildings 1,500,000
Depreciation on machinery 3,000,000
Goodwill impairment 600,000
Salaries and wages 14,000,000
Bonuses and commissions 4,750,000
Other employee entitlements 1,900,000
Insurance 650,000
Electricity and other utilities 2,000,000
Communications 1,850,000

Account Titles DR (RM) CR (RM)
Cash on hand (DR) 50,000
Cash at bank (DR) 6,700,000
Accounts receivable (DR) 8,450,000
Allowance for doubtful debts (CR) 1,600,000
Prepaid assets (DR) 1,300,000
Interest receivable (DR) 900,000
Raw materials inventory (DR) 4,000,000
Other inventories (DR) 1,750,000
Shares in listed companies (DR) 12,500,000
Debentures (DR) 8,350,000
Land (DR) 60,000,000
Machinery (DR) 16,500,000
Accumulated depreciation, machinery (CR) 4,600,000
Buildings (DR) 35,000,000
Accumulated depreciation, buildings (CR) 4,900,000
Goodwill (DR) 5,400,000
Accumulated impairment, goodwill (CR) 2,300,000
Deferred tax assets (DR) 640,000
Accounts payable (CR) 2,100,000
Interest payable (CR) 960,000
Rent payable (CR) 470,000
Salaries payable (CR) 1,300,000
Dividends payable (CR) 1,400,000
Provisions (CR) 11,250,000
Current tax liability (CR) 6,480,000
Mortgage payable (CR) 14,500,000
Debentures payable (CR) 12,000,000
Deferred tax liabilities (CR) 460,000
Other long-term liabilities (CR) 3,000,000
Share capital (CR) 36,000,000
Retained earnings (CR) 29,710,000
Revaluation reserve (CR) 5,000,000
Available for sale financial assets revaluation
reserve ((CR) 2,000,000
General reserve (CR) 1,100,000
Sales revenue (CR) 90,000,000
Sales revenue earned from related parties (CR) 3,000,000
Dividends revenue from subsidiaries (CR) 200,000
Dividend revenue from other parties (CR) 100,000
Interest revenue (CR) 300,000
Gain on sale of buildings (CR) 400,000
Cost of goods sold (DR) 29,000,000
Clerical expenses (DR) 8,400,000
Rental of administrative buildings (DR) 4,300,000
Other administrative expenses (DR) 800,000
Selling expenses (DR) 10,250,000
Marketing and advertising expenses (DR) 8,350,000
Rental of distribution fleet (DR) 640,000
Other distribution expenses (DR) 100,000
Interest on mortgage (DR) 2,400,000
Other interest expenses (DR) 950,000
Income tax expense (DR) 3,450,000
Other expenses (DR) 4,950,000

Required
Prepare ABC Berhad's financial statements for the year ended 31 December 2009. They
should be prepared in accordance with the relevant accounting standards and be
accompanied by appropriate note disclosures.

ADBot