2108AFE Financial Accounting Topic 9 2108AFE Financial Accounting Assessable Wor
ID: 2340784 • Letter: 2
Question
2108AFE Financial Accounting Topic 9 2108AFE Financial Accounting Assessable Workshop Question Topic 9 - Statement of Cash Flows Question 1 Yellow Submarine Ltd's Balance Sheets at the end of June 2016 and 2017 were as follows Yellow Submarine Ltd. Balance Sheets as at 30 June 20172016 SSETS urrent Assets 0 counts Receivable 200,000 107,50 20,000 (10,000 305.500 182.500 llowance for Doubtful Dchts 485 280. Non-Current Assets Land ildin 60 35,000) (30,000 00,000 207,00 55,500) (27,000 294 780,000 500, umulatedI iation-buildin Plant&Equip t & 220.000 TOTAL ASSETS LIABILITIES AND OWNERS' EQUITY urrent Liabilities Overdraft counts Payable 167,950 58,800 29,300 36,200 15,0001 6,00 urrent Tax 21 101 Owners' Equit 385,000! 300.00 Revaluation Reserve eneral Reserve Retained Profits Total Equit 15,000 85,000! 50.00 82,750 49,00 567 399 TAL LIABILITIES AND OWNERS ITYExplanation / Answer
SOLUTION =
YELLOW SUBMARINE LTD.
STATEMENT OF CASH FLOWS ( FOR THE YEAR ENDED 30 JUNE 2017
( INDIRECT METHOD)
WORKING NOTES >
1)NET PROCEEDS FROM PLANT AND EQUIPMENTS = SALE PRICE - COST= 47,500- 40,000
2) CALCULATION OF NEW PLANT & EQUIPMENTS =
PLANT & EQUIPMENT AT THE END OF PERIOD = 300,000
PLANT & EQUIPMENT AT THE BEGNNING = 207,000
PLANT & EQUIPMENT SOLD = 40,000
NEW PLANT & EQUIPMENT PURCHASED (300,000+40,0000-207,000) = 133,000
3)ISSUE OF SHARE CAPITAL
SHARE CAPITAL AT THE BEGNNING = 300,000
SHARE CAPITAL AT THE END = 385,000
PROCEEDS FROM ISSUE OF SHARE CAPITAL (385,000-300,000) = 85,000
3)INCREASE AND DECREASE IN FOLLOWING
PARTICULARS 30.06.2017 30.06.2016 INCRE.(DEC.)
A) ACCOUNTS RECEIVABLES 200,000 107,000 93,000
B) INVENTORY 305,500 182,500 123,000
C) ACCOUNTS PAYABLE 29,300 36,200 (6,900)
D) CURRENT TAX PAYABLE 15,000 6,000 9,000
PARTICULARS AMOUNT($) CASH FLOWS FROM OPERATING ACTIVITY = PROFIT BEFORE TAXATION 143,750 ADD:- DEPRECIATION BUILDING 5,000 PLANT & MACHINERY 38,500 NET CASH FLOW FROM PLANT & EQUIPMENT( 47,500-40,000) (7500) INCREASE IN ACCOUNTS RECEIVABLES (92,500) INCREASE IN INVENTORY (123,000) DECEREASE IN ACCOUNT RECEIVABLE (6,900) DECREASE IN CURRENT TAX PAYABLE 9000 INCOME TAX PAID (52,500) NET CASH FLOWS FROM OPERATING ACTIVITIES(A) (86,150) CASH FLOWS FROM INVESTMENT ACTIVITIES= PURCHASE OF PLANT & EQUIPMENT (133,000) PROCEEDS FROM SALE OF PLANT & EQUIPMENT 47,500 NET CASH FLOWS FROM INVESTING ACTIVITIES(B) (85,500) CASH FLOWS FROM FINANCING ACTIVITIES PROCEEDS FROM ISSUES OF SHARE CAPITAL 85,000 DIVIDEND PAID (22,500) NET CASH FLOWS FROM FINANCING ACTIVITIES(C) 62,500 NET INCREASE IN CASH & CASH EQUIVALENTS (A+B+C) (109,150) CASH & CASH EQUIVALENTS BEGNNING OF THE PERIOD (58,800) CASH & CASH EQUIVALENTS AT THE END OF THE PERIOD (167,950)Related Questions
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