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Statement of Financial Position
Of TMH Ltd. as at 30 June 2009.
2009 | 2008 | |
Assets: | $ | $ |
Current Assets: | ||
Cash | 52,000 | 46,000 |
Accounts Receivable | 124,000 | 134,000 |
Inventory | 156,000 | 176,000 |
Total Current Assets: | 332,000 | 356,000 |
Land | 178,000 | 140,000 |
Buildings | 415,000 | 290,000 |
Less Accumulated Depreciation | (120,000) | (105,000) |
Total Land and Buildings | 473,000 | 325,000 |
Total Assets: | 805,000 | 681,000 |
Liabilities | ||
Current Liabilities | ||
Expense Payable | 155,000 | 124,000 |
Accounts Payable | 167,000 | 197,000 |
Total Current Liabilities | 322,000 | 321,000 |
Long-Term Borrowings | 192,000 | 139,000 |
Owner's Equity | ||
Ordinary Share Capital | 50,000 | 45,000 |
Retained Earnings | 241,000 | 176,000 |
Total Owner's Equity | 805,000 | 681,000 |
Note:
Paragraph 10 of AASB 101 requires an entity to display complete set of financial statements (Leo, Susan, Sweeting, & Knapp, 2015). Besides that paragraph 38 of AASB 101 requires an entity to disclose the comparative financial in respect of previous reporting period.
Figure 1
From the above chart it is clear that there is increase in cash balance but a decline in accounts receivable and inventory.
Figure 2
From the above chart it is clear that there is increase in balance of land due to revaluation and increase in balance of buildings due to purchase of new building.
Figure 3
There is increase in expense payable liability and decline in accounts payable liability.
Figure 4
There is increase in share capital and retained earnings.
Cash: | |
Opening balance | 46,000 |
Add: Received from cash sales | 320,000 |
Add: Received from AR | 10,000 |
Add: Share capital proceeds | 5,000 |
Less: Accounts Payable | (170,000) |
Less: Expenses | (20,000) |
Less: Dividends | (67,000) |
Less: Buildings | (125,000) |
Add: Long-Term Borrowings | 53,000 |
Closing balance | 52,000 |
Accounts Receivable: | |
Opening balance | 134,000 |
Less: Cash Received | (10,000) |
Closing balance | 124,000 |
Expense Payable: | |
Opening balance | 124,000 |
Add: Expense for the year 2009 (b.f.) | 51,000 |
Less: Cash paid for expense | (20,000) |
Closing balance | 155,000 |
Retained Earnings: | |
Opening balance | 176,000 |
Add: Transfer | 65,000 |
Closing balance | 241,000 |
Accounts Payable: | |
Opening balance | 197,000 |
Add: Inventory purchased (b.f.) | 140,000 |
Less: Cash paid | (170,000) |
Closing balance | 167,000 |
Inventory: | |
Opening balance | 176,000 |
Add: Inventory purchased | 140,000 |
Less: Cost of goods sold | (160,000) |
Closing balance | 156,000 |
Land: | |
Opening balance | 140,000 |
Add: Gain on revaluation | 38,000 |
Closing balance | 178,000 |
Buildings | |
Opening balance | 290,000 |
Add: New building purchased | 125,000 |
Closing balance | 415,000 |
2. Statement of Financial Performance
Statement of Financial Performance
Of TMH Ltd for the year ended 30th June 2009.
Revenue | 320,000 |
Cost of goods sold | (160,000) |
Gross Profit | 160,000 |
Other Income | - |
Entertainment expense | 6,000 |
Other expense | 45,000 |
Depreciation | 15,000 |
Income tax | - |
Profit for the year | 94,000 |
Gains on land revaluation | 38,000 |
Total comprehensive income for the year | 132,000 |
Dividends Paid | 67,000 |
Profit transferred to retained earnings | 65,000 |
Graphs and Charts
Figure 5
Majority of expense is from cost of goods sold i.e. 71% of the cost is inventory cost.
Workings
Depreciation: | |
Accumulated Dep. Opening Bal. | 105,000 |
Accumulated Dep. Closing Bal. | 120,000 |
Depreciation for year 2009 | 15,000 |
Figure 6
The target of management was to make a reduction in the liabilities by 5%. However in real life there in an increase of 11.69% in the liabilities. Thus it is clear that the company goals have not met and there is negative variance.
Year----> | 2009 | 2008 |
Current Liabilities | 322,000 | 321,000 |
Long-term Liabilities | 192,000 | 139,000 |
Total Liabilities | 516,009 | 462,008 |
Increase in liabilities | 54,001 | |
Percentage change | 11.69% | |
Management Target | -5% |
NOTE: IT IS NOT POSSIBLE TO ANALYSIS ‘CHANGE IN PROFITS’ AND ‘CHANGE IN SALES’, AS DATA FOR YEAR 2008 IS NOT AVAILABLE.
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