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Dear Mike,
I was wondering whether you can help me with some questions in BPP exam kit. They are cash flow question (Q279 and 280, regarding Pinto).
1. For Q279, I am struggling to calculate the tax received. Where can I find ‘b/f current asset’ whilst calculating tax received which involves deferred tax?
2. Q280, I am struggling to understand investment property income figure. If 60,000 is included in profit before tax in respect of income and gains on investment property and in balance sheet, there has been a 20,000 increase in investment property, why is final figure 60-20?
3. Final question is general one about dividend. If dividend is paid in the middle of the year where number of shares increase from 10 to 20. Do we assume that when the dividend is paid, that the shares have been issued? Thus dividend paid will be dividend per share x 20.
Thank you so much
“1. For Q279, I am struggling to calculate the tax received. Where can I find ‘b/f current asset’ whilst calculating tax received which involves deferred tax?”
Did you look in last year’s current assets?
“2. Q280, I am struggling to understand investment property income figure. If 60,000 is included in profit before tax in respect of income and gains on investment property and in balance sheet, there has been a 20,000 increase in investment property, why is final figure 60-20?”
If the profit or loss figure for “income and gains on investment property” is $60,000 and, of that figure, $20,000 is a revaluation gain involving no cash, then are we not able to deduce that the investment cash income must be …..
“3. Final question is general one about dividend. If dividend is paid in the middle of the year where number of shares increase from 10 to 20. Do we assume that when the dividend is paid, that the shares have been issued? Thus dividend paid will be dividend per share x 20.”
Ask yourself this …”Why would a company pay a dividend on shares that have not yet been issued?”
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