Financial Statements Preparation

Tax paid in the year Tax liability at the beginning of year 300,000 Additional Tax liability during the year 450,000 Total liability 750,000 End of year outstanding tax liability 450,000 Tax paid during the year 300,000 Depreciation Depreciation Schedule Cost 200,000 Useful life 10 Scrap value 20,000 Annual DepreciationCumulative DepreciationNet book valueYear 1 18,000 18,000 182,000 Year 2 18,000 36,000 164,000 Year 3 18,000 54,000 146,000 Year 4 18,000 72,000 128,000 Year 5 18,000 90,000 110,000 Year 6 18,000 108,000 92,000 Year 7 18,000 126,000 74,000 Year 8 18,000 144,000 56,000 Year 9 18,000 162,000 38,000 Year 10 18,000 180,000 20,000 The total depreciation for the 3 years as indicated in the income statement is 18,000 The following non-current asset also will be indicated in the financial position statement at the close of year 3. Cost non-current asset 200,000 Cumulative depreciation 54,000 Net value of asset 146,000 If all the assets are disposed at a total cost of 120,000 in year 4, the following changes will be effect will be recorded income statement for year 4 Cost non-current asset 200,000 Cumulative depreciation 72,000 Net value of asset 128,000 Sales proceeds 120,000 Loss on disposal 8,000 A loss of 8,000 will