Kenya Kwanza ltd wants to determine its liquidity position in 5 years from closure of business in year 2023. The financial position as at December 2023 was: Balance sheet as at 31 December, 2023 Fixed assets: Ksh. '000' Ksh. '000' Freehold premises 1,680,000 Leasehold premises 1,200,000 Plant and equipment 1,120,000 Motor vehicles 600,000 4,600,000 Current assets: Stocks 2,120,000 Debtors 880,000 Bank balance 240,000 3,240,000 7,840,000 Capital & liabilities: Creditors 1,440,000 Accrued expenses 1,120,000 Ordinary share capital 4,000,000 Reserves 380,000 15% loan 900,000 7,840,000 7,840,000 Additional information: 1. The loan will mature before the end of the 5 year period and will be duly settled. 2. Sales for year 2023 amounted to ksh 16,000m and are expected to grow by 8% per year in each of the five years from 2024 to 2028. 3. Dividend payout ratio of 40% is to be maintained. 4. Profit after tax is to be maintained at 14% of sales 5. Except for the ordinary share capital and reserves, all the remaining balance sheet items are to maintain their current (2023) percentage of sales Required: Determine the Total Uses of funds as at December 2028. Question 1Answer A. Ksh 4,579, 532 B. Ksh 5,501, 532 C. Ksh 3,969, 572 D. Ksh 4,919,5127
Kenya Kwanza ltd wants to determine its liquidity position in 5 years from closure of business in year 2023. The financial position as at December 2023 was: Balance sheet as at 31 December, 2023 Fixed assets: Ksh. '000' Ksh. '000' Freehold premises 1,680,000 Leasehold premises 1,200,000 Plant and equipment 1,120,000 Motor vehicles 600,000 4,600,000 Current assets: Stocks 2,120,000 Debtors 880,000 Bank balance 240,000 3,240,000 7,840,000 Capital & liabilities: Creditors 1,440,000 Accrued expenses 1,120,000 Ordinary share capital 4,000,000 Reserves 380,000 15% loan 900,000 7,840,000 7,840,000 Additional information: 1. The loan will mature before the end of the 5 year period and will be duly settled. 2. Sales for year 2023 amounted to ksh 16,000m and are expected to grow by 8% per year in each of the five years from 2024 to 2028. 3. Dividend payout ratio of 40% is to be maintained. 4. Profit after tax is to be maintained at 14% of sales 5. Except for the ordinary share capital and reserves, all the remaining balance sheet items are to maintain their current (2023) percentage of sales Required: Determine the Total Uses of funds as at December 2028. Question 1Answer A. Ksh 4,579, 532 B. Ksh 5,501, 532 C. Ksh 3,969, 572 D. Ksh 4,919,5127
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Kenya Kwanza ltd wants to determine its liquidity position in 5 years from closure of business in year 2023. The financial position as at December 2023 was: Balance sheet as at 31 December, 2023
Fixed assets: Ksh. '000' Ksh. '000' Freehold premises 1,680,000 Leasehold premises 1,200,000 Plant and equipment 1,120,000 Motor vehicles 600,000 4,600,000 Current assets: Stocks 2,120,000
Debtors 880,000 Bank balance 240,000 3,240,000 7,840,000 Capital & liabilities: Creditors 1,440,000 Accrued expenses 1,120,000 Ordinary share capital 4,000,000 Reserves 380,000 15% loan
900,000 7,840,000 7,840,000 Additional information: 1. The loan will mature before the end of the 5 year period and will be duly settled. 2. Sales for year 2023 amounted to ksh 16,000m and are
expected to grow by 8% per year in each of the five years from 2024 to 2028. 3. Dividend payout ratio of 40% is to be maintained. 4. Profit after tax is to be maintained at 14% of sales 5. Except
for the ordinary share capital and reserves, all the remaining balance sheet items are to maintain their current (2023) percentage of sales Required: Determine the Total Uses of funds as at December
2028. Question 1Answer A. Ksh 4,579, 532 B. Ksh 5, 501, 532 C. Ksh 3,969, 572 D. Ksh 4,919,5127
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