Answered: ASSETS Equipment Inventory Trade…

Financial Reporting, Financial Statement Analysis and Valuation

8th Edition

ISBN:9781285190907

Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Chapter2: Asset And Liability Valuation And Income Recognition

Section: Chapter Questions

Problem 21PC

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QUESTION FOUR [25] The following information was extracted from Zayra Proprietary Limited’s annual financial statements for the year ended 29 February 2024 in preparation of the Statement of Cash Flows for the current year: Zayra Proprietary Limited Statement of Financial Position as at 29 February 2024 (with comparative values for 28 February 2023): 29 February 2024 28 February 2023 ASSETS R R Equipment 636 000 324 000 Inventory 82 800 45 600 Trade Receivables 22 800 27 600 Bank 237 600 120 000 Total Assets 979 200 517 200 EQUITY AND LIABILITIES EQUITY 662 400 424 800 Ordinary share capital 396 000 300 000 Retained Earnings 336 000 124 800 3 LIABILITIES 247 200 92 400 Mortgage Bond 186 000 48 000 Trade Payables 25 200 19 200 SARS: Tax Payable 36 000 25 200 Total Equity and Liabilities 909 600 517 200 Additional Information: 1. Authorised share capital: 1 000 000 Ordinary shares 2. Issued share capital: 100 000 Ordinary shares were sold for cash during the current financial period. 3. Dividends of R30 000 were declared on 20 February 2024 and paid on 20 April 2024. 4. New equipment was purchased during the current financial year for R240 000. 5. Zayra raised a long term loan of R168 000 in May 2023. 6. The following information was extracted from the statement of comprehensive income for the year ended 29 February 2024: • Sales for the year was R1 464 000 • Rental income was R26 400 • Profit on disposal of equipment R36 000 • Depreciation R48 000 • Interest expense R50 400 • Income tax expense R147 600 • Profit after tax R222 000 Required: Prepare the statement of cash flows for Zayra Proprietary Limited for the financial year ended 29 February 2024 in compliance with the requirements of the International Financial Reporting Standards (IFRS) in as much as the given information allows. Use the indirect method.