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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Flufftort part – 2
Dear sir,
In the second part of flufftort
Why isn’t the additional loan (35) taken and the extra subscription of shares at par of (15+20) added to the cash?
I mean when they subscribed to the shares and got the extra loan, the cash must have increased right? But they just used a balancing figure of 5 for cash ?
Please help thank you
They will indeed receive extra cash as you have stated. However, most of the cash is being used to fund the expected production of the Easicushion chair. They have to spend money increasing the non-current assets and increasing the net current assets.
Thank you !!
Can’t believe I missed this point!!
You are welcome 🙂