SFOP
After refincing take place
Directors would subscribed to an addition of 15m and Gupte VC of 20 m at par. = 35m addition.
8.5% loan note would be increased to $65m and current loan is $30m = 35m addition
Based on my understanding these additions should increase the current asset (Cash item).
Examiner answer, the addition is reflected on non current asset and current asset excluding cash.
Kindly advise
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September / December 2015 Q3
10y ago#1Note 5 of the question says what the finance is being used for.
Thank you for the answer
10y ago#3You are welcome :-)
9y ago#4Mr.Moffat
Can you explain to me how the Retained earnings reduce to $5m from $2.6m in 2015,after the refinancing takes place.
9y ago#5The retained earnings at 30 June 2015 are 2.6M (as per the question).
The forecast retained profits for 2016 are 2.4M, and so the retained earnings on the SOFP for 30 June 2016 will increase by 2.4M to 5M.
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