ADVANCED FINANCIAL ACCOUNTING 1Assignment 41. Below are the statements of financial position of Dickson as at 31 March 20X8 and 31 March20X7, together with the statement of profit or loss and other comprehensive income for theyear ended 31 March 20X8.20X820X7$'00$'000Non-current assetsProperty, plant and equipmentDevelopment expenditure9257372901601,215897Current assetsInventories360227Trade receivables274324Investments14346Cash292,0211171,611Total assetsEquityShare capital - $1 ordinary shares500400100Share premiumRevaluation surplus35016060Retained earnings2291,239_255815Non-current liabilities6% debentures150100Finance lease liabilities10080Deferred tax4845Current liabilitiesTrade payables274352Finance lease liabilities1712Current tax56153Debenture interest5Bank overdraft132541,611Total equity and liabilities2,021STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOMES'000Revenue1,476Cost of sales(962)Gross profitOther expenses514(157)Finance costs(15)Profit before tax342Income tax expense(162)Profit for the year180Other comprehensive income:Gain on revaluation of property, plant and equipmentTotal comprehensive income for the year100280Notes(i) During 20X8, amortisation of $60,000 was charged on development projects.(ii) During 20X8 items of property, plant and equipment with a carrying amount of $103,000were sold for $110,000. Profit on sale was netted off against 'other expenses'.Depreciation charged in the year on property, plant and equipment totalled $57,000. Dicksonpurchased $56,000 of property, plant and equipment by means of finance leases, paymentsbeing made in arrears on the last day of each accounting period.(iii) The current asset investments are government bonds and management has decided to classthem as cash equivalents.(iv) The new debentures were issued on 1 April 20X7. Finance cost includes debenture interestand finance lease finance charges only.(v) During the year Dickson made a 1 for 8 bonus issue, capitalising its retained earnings,followed by a rights issue.Required: Prepare a statement of cash flows for Dickson in accordance with IAS 7 using theindirect method.

Cash Flow Statement The purpose of preparing the cash flow statement is to analyze the details of…

Notes (1) During 20X8, amortisation of $60,000 was charged on development projects. (ii) During 20X8 items of property, plant and equipment with a carrying amount of $103,000 were sold for $110,000. Profit on sale was netted off against 'other expenses'. Depreciation charged in the year on property, plant and equipment totalled $57,000. Dickson purchased $56,000 of property, plant and equipment by means of finance leases, payments being made in arrears on the last day of each accounting period. (i) The current asset investments are government bonds and management has decided to class them as cash equivalents. (iv) The new debentures were issued on 1 April 20X7. Finance cost includes debenture interest and finance lease finance charges only. (v) During the year Dickson made a 1 for 8 bonus issue, capitalising its retained earnings, followed by a rights issue. Required: Prepare a statement of cash flows for Dickson in accordance with IAS 7 using the indirect method.

Notes (1) During 20X8, amortisation of $60,000 was charged on development projects. (ii) During 20X8 items of property, plant and equipment with a carrying amount of $103,000 were sold for $110,000. Profit on sale was netted off against 'other expenses'. Depreciation charged in the year on property, plant and equipment totalled $57,000. Dickson purchased $56,000 of property, plant and equipment by means of finance leases, payments being made in arrears on the last day of each accounting period. (i) The current asset investments are government bonds and management has decided to class them as cash equivalents. (iv) The new debentures were issued on 1 April 20X7. Finance cost includes debenture interest and finance lease finance charges only. (v) During the year Dickson made a 1 for 8 bonus issue, capitalising its retained earnings, followed by a rights issue. Required: Prepare a statement of cash flows for Dickson in accordance with IAS 7 using the indirect method.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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