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Dear Tutor ,
Firstly apologies for the long question and sorry to be a pain but this is a 15 marks question for F3 module so I would like to be more clear. Using the following information how Statement of Cash flow is prepared? your help is greatly appreciated
ThanksStatement of Profit and loss or the year ended 31 Dec 20×2
In ($’000)
Sales Revenue: 2533
Cost of sales: (1814)
Gross profit: 739
Distribution Cost: (125)
Admin Expenses: (264)Operating Profit: 350
Depreciation : (90)
Interest Received : 25
Interest Paid : (75)
Profit Before Tax : 210
Income Tax Expense : 240
Profit for the year : (30)Statement of Financial Position as at December
20×2($’000) 20×1($’000)
Non current assets
Tangible assets : 380……………………….. 305
Intangible assets : 250 …………………….. 200
Investments : — ………………………… 25
630 530
Current Assets
Inventories : 150……………………………….102
Receivables 390 ……………………………..315
Short-term Investments : 50 ………………………….. —-
Cash in hand : 2 ………………………………….1
Total Current Assets : 592……………………………… 418
Total Assets : 1222 ……………………………..948Equity and liabilities
Share Capital ($1 ordinary shares ) : 200 ……………………………….150
Share Premium account : 160 ………………………………150
Revaluation Surplus : 100 …………………………………91
Retained Earnings : 160 ………………………………..100
Total : 620 ………………………… 491Non- current liabilities
Long- term loan : 100…………….. —-Current liabilities
Trades Paybles : 127 …………………………. 119
Bank Overdraft : 85 …………………………… 98
Taxation : 290 …………………. 240
Total : 502 ………… 457
1222 …………………….. 948The following information is available:
1. The proceeds of the sale of non- current asset investment amounted to $30,000.2. Fixtures and fittings with an original cost of £85,000 and a carrying value of $45,000 were sold for £32,000 during the year.
3. 50,000 $1 ordinary shares were issued during the year at a premium of 20c per share
Prepare statement of Cash flow for the year to 31 December 20×2 with the relevant notes to the statement.
I am sorry but I cannot write up full answers to questions like this on here!
You must watch the free lecture on Statements of cash flows. Then try this example yourself and ask me about any specific problems – then I will try to help.
You presumably have an answer in whatever book you found the question. You must only really ask about specific problems here.Thanks John, I will follow as you suggested …will let you know if i get confused .
Tutor:
In statement of cash flows, example 1 – Blair Limited:
You did two workings prior to proceeding to do the cash flow statement. One of which is “tax”.
While I understand why you did workings for the non current asset, given the “relevant information”, I don’t understand why you did workings for tax when there were no additional information given. In other words, how would I know that I would have to address Tax before delving into the question?Because on the statement you need the tax actually paid (it is a cash flow statement) which is not the same as the tax charged in the SOPOL
Also question 5:
At JUNE 30 2005 the capital reserves of smith were:Ordinary shares of $1 each. 100
Share premium 80
During the year. Ended June 30, 2006
1 September 2005. A bonus issue of one ordinary share for every two
held USING THE SHARE PREMIUM ACCOUNT.
1 January 2006. A fully subscribed rights issue of two ordinary shares
For every five held at that date at $1.50 per share.What would be the balance on each account be at 30 June 2006?
My workings:
# shares. Share capital. Share premium
100. 100. 80
50. ? ?
60. 60. 30Thanks
Question 5???? Where?
(Please start a new thread when it is a different topic – this has nothing to do with Statements of cash flows)The bonus issue of 50 shares means than share capital increases by the nominal value of the shares issued and share premium reduces by the same amount.
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