Write a report that explains with reference to appropriate accounting standards.1) At 1 April 2020, Honister plc had its land and building revalued to £600 million. This valuation includes a value for land of £120 million. The estimated remaining life of the building at that date was 40 years. Depreciation of buildings is charged on a straight-line basis and is allocated 60% to cost of sales, 20% to distribution costs and 20% to administrative expenses.
2) During the year, Honister plc manufactured an item of plant that it is using as part of its own operating capacity. The details of its cost, which is included in cost of sales in the trial balance, are:
£52 million.
6) The inventory at 31 March 2021 was valued at cost of £42.5 million. This includes £6.5 million of slow-moving goods. Honister plc is trying to sell these to another company, but has not been successful in obtaining a reasonable offer. The best price it has been offered is £4 million.
7) The Corporation tax account in the trial balance represents the over-provision of the previous year’s estimate. The estimated Corporation tax liability for the year ended 31 March 2021 is £13.8 million. At 31 March 2021 there were £62.5 million of taxable temporary differences. The Corporation tax rate is 20%.
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