Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › cash flows from financing activities
- This topic has 5 replies, 2 voices, and was last updated 8 years ago by MikeLittle.
- AuthorPosts
- August 21, 2015 at 11:04 am #267956
and this…
Delta’s SFP:
December 31, 2008 December 31, 2007
Share capital 2,000 1,200
Share premium 400 100
Finance lease liabilities (long-term portion) 3,000 4,000
Finance lease liabilities (short-term portion) 1,800 2,000Note: During the year Delta has entered into a new finance lease agreement and recorded fixed assets worth of 1,000.
Required: Prepare a fragment of a statement of cash flows from financing activities.
August 21, 2015 at 12:13 pm #267964Share issue proceeds 1,100
Payments to finance lease creditors 2,200Does that agree with the solution?
August 21, 2015 at 12:24 pm #267966there’s no solution for these questions, I’m afraid. I can see now how you arrived at 1,100, but why 2,200? we paid only 1,200 (1,000+200) on lease liabilities, I believe.
August 21, 2015 at 1:31 pm #267973Put both brought forward liabilities into the credit side of a single T account (4,000 and 2,000)
Put both carry forward liabilities into the debit side of the same T account (3,000 and 1,800)
Put into the credit side of that same T account the 1,000 new finance lease liability
That gives us credits of 7,000 and debits of 4,800 – a missing figure on e debit side of 2,200
That entry MUST have been Dr Finance Lease Liabilities 2,200 Cr Cash 2,200
Ok?
August 21, 2015 at 2:41 pm #267978yeah, now I see !!!
thank you so much, I think I’ll try to employ T account in all my cash flow calculations now 🙂August 21, 2015 at 8:23 pm #268006That’s a good idea. Last time I taught in your area (Uzbekistan) I remember telling the students that really the only time I found T accounts of immense value was in Cash Flow questions.
It is possible to do without – of course it is – but if there’s any tiny element of doubt, then open a T account
- AuthorPosts
- You must be logged in to reply to this topic.