Crowdly
Add to Chrome
Qabaqongo Oils Ltd is a sunflower oil production and distribution business, sup...
✅ The verified answer to this question is available below. Our community-reviewed solutions help you understand the material better.
Qabaqongo Oils Ltd is a sunflower oil production and distribution business, supplying various retailers and wholesalers throughout Mpumalanga. Below is the relevant information regarding the company’s financial activities for the year ending 30 June 2024.
Extract of balances as at 30 June 2024:
| R | |
| Inventory | R106,600 |
| Bank (positive) | R293,600 |
| Trade receivables control | R199,200 |
| Vehicles at cost | R708,200 |
| Equipment at cost | R209,300 |
| Factory building at cost | R575,100 |
| Accumulated depreciation: Vehicles | R41,700 |
| Accumulated depreciation: Equipment | R68,800 |
| Allowance for credit losses | R3,000 |
| Trade payables control | R119,800 |
| Share Capital | R431,500 |
2. Supplementary information:
2.1 Adjustments at the end of the year:
2.2.1 The business aimed to expand its operations by acquiring additional land for sunflower cultivation. On 30 June 2024, KEN Corp provided a loan of R468 000 to facilitate the purchase of a farm. The farmland was acquired on 2 July 2024 at the cost of R468,000. This loan is classified as long-term, with an 8% annual interest rate, to be repaid over 6 years with equal instalments starting from 30 June 2025. This transaction has not yet been recorded.
2.2.1 On 30 June 2023, it was decided that an outstanding debt of R17 000 owed to the business was unlikely to be recovered and should be written off as bad debt.
Which one of the following alternatives represents the correct amount that must be disclosed as property, plant and equipment in the statement of financial position of Qabaqongo Oils Ltd as at 30 June 2024?