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The following is the summarized statement of financial position Malover Ltd at 31 December 2019 and 2020: 31.12.20 31.12.19 Assets Sh. '000' Sh. '00' 380,000 360,000 Freehold property at cost Plant and machinery at cost Furniture and fittings at cost 70,000 67,000 3,200 4,500 Investments 20,000 --- Stock 68,000 64,000 Debtors and prepaid expenses 79,000 68,000 Bank balance 41,000 18,000 Total assets 642,500 600,200 Equity and liabilities: Share capital (issued and fully paid shares of Sh20 each) 350,000 300,000 Share premium 8% redeemable preference capital (shares of Sh200 each)--- 32,500 40,000 100,000 Profit and loss account 33,000 29,200 10% debentures 30,000 --- Capital redemption reserve fund Taxation 50,000 45,000 40,000 --- Proposed dividend 30,000 27,000 72,000 64,000 642,500 600,200 Trade creditors and accruals Total equity and liabilities Additional information a. The investments were disposed of for cash Sh. 19,800,000. Furniture and fittings with a net book of Sh. 200,000 were sold for cash Sh. 180,000. b. The preference shares were redeemed at a premium provided out profit the share premium account. Subsequently, 2,500,000 ordinary shares of Sh20 each were issued at a premium of 25%. c. On January 1st 2020, Malover Ltd. issued Sh. 300,000 10% debentures at Sh96 each for every Sh100 nominal. The discount arising from this issue was charged to the profit and loss account. d. The depreciation charged during the year was as follows: Plant and Machinery Sh. 21,400,000 Furniture and fittings Sh. 800,000

The following is the summarized statement of financial position Malover Ltd at 31 December 2019 and 2020: 31.12.20 31.12.19 Assets Sh. '000' Sh. '00' 380,000 360,000 Freehold property at cost Plant and machinery at cost Furniture and fittings at cost 70,000 67,000 3,200 4,500 Investments 20,000 --- Stock 68,000 64,000 Debtors and prepaid expenses 79,000 68,000 Bank balance 41,000 18,000 Total assets 642,500 600,200 Equity and liabilities: Share capital (issued and fully paid shares of Sh20 each) 350,000 300,000 Share premium 8% redeemable preference capital (shares of Sh200 each)--- 32,500 40,000 100,000 Profit and loss account 33,000 29,200 10% debentures 30,000 --- Capital redemption reserve fund Taxation 50,000 45,000 40,000 --- Proposed dividend 30,000 27,000 72,000 64,000 642,500 600,200 Trade creditors and accruals Total equity and liabilities Additional information a. The investments were disposed of for cash Sh. 19,800,000. Furniture and fittings with a net book of Sh. 200,000 were sold for cash Sh. 180,000. b. The preference shares were redeemed at a premium provided out profit the share premium account. Subsequently, 2,500,000 ordinary shares of Sh20 each were issued at a premium of 25%. c. On January 1st 2020, Malover Ltd. issued Sh. 300,000 10% debentures at Sh96 each for every Sh100 nominal. The discount arising from this issue was charged to the profit and loss account. d. The depreciation charged during the year was as follows: Plant and Machinery Sh. 21,400,000 Furniture and fittings Sh. 800,000

FINANCIAL ACCOUNTING
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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prepare cashflow statement for the year ended 2020 december 31st in line with IAS7 - International Accounting Standard 

The following is the summarized statement of financial position Malover Ltd at 31 December 2019 and 2020: 31.12.20 31.12.19 Assets Sh. '000' Sh. '000' Freehold property at cost Plant and machinery at cost Furniture and fittings at cost 380,000 360,000 70,000 67,000 4,500 3,200 Investments 20,000 68,000 64,000 79,000 68,000 Stock Debtors and prepaid expenses Bank balance 41,000 18,000 Total assets 642,500 600,200 Equity and liabilities: Share capital (issued and fully paid shares of Sh20 each) 350,000 300,000 Share premium 32,500 40,000 8% redeemable preference capital (shares of Sh200 each) --- 100,000 Profit and loss account 33,000 29,200 10% debentures 30,000 Capital redemption reserve fund 50,000 Taxation 45,000 40,000 Proposed dividend 30,000 27,000 72,000 64,000 642,500 600,200 Trade creditors and accruals Total equity and liabilities Additional information a. The investments were disposed of for cash Sh. 19,800,000. Furniture and fittings with a net book of Sh. 200,000 were sold for cash Sh. 180,000. b. The preference shares were redeemed at a premium provided out profit the share premium account. Subsequently, 2,500,000 ordinary shares of Sh20 each were issued at a premium of 25%. c. On January 1st 2020, Malover Ltd. issued Sh. 300,000 10% debentures at Sh96 each for every Sh100 nominal. The discount arising from this issue was charged to the profit and loss account. d. The depreciation charged during the year was as follows: Plant and Machinery Sh. 21,400,000 Furniture and fittings Sh. 800,000
Transcribed Image Text:The following is the summarized statement of financial position Malover Ltd at 31 December 2019 and 2020: 31.12.20 31.12.19 Assets Sh. '000' Sh. '000' Freehold property at cost Plant and machinery at cost Furniture and fittings at cost 380,000 360,000 70,000 67,000 4,500 3,200 Investments 20,000 68,000 64,000 79,000 68,000 Stock Debtors and prepaid expenses Bank balance 41,000 18,000 Total assets 642,500 600,200 Equity and liabilities: Share capital (issued and fully paid shares of Sh20 each) 350,000 300,000 Share premium 32,500 40,000 8% redeemable preference capital (shares of Sh200 each) --- 100,000 Profit and loss account 33,000 29,200 10% debentures 30,000 Capital redemption reserve fund 50,000 Taxation 45,000 40,000 Proposed dividend 30,000 27,000 72,000 64,000 642,500 600,200 Trade creditors and accruals Total equity and liabilities Additional information a. The investments were disposed of for cash Sh. 19,800,000. Furniture and fittings with a net book of Sh. 200,000 were sold for cash Sh. 180,000. b. The preference shares were redeemed at a premium provided out profit the share premium account. Subsequently, 2,500,000 ordinary shares of Sh20 each were issued at a premium of 25%. c. On January 1st 2020, Malover Ltd. issued Sh. 300,000 10% debentures at Sh96 each for every Sh100 nominal. The discount arising from this issue was charged to the profit and loss account. d. The depreciation charged during the year was as follows: Plant and Machinery Sh. 21,400,000 Furniture and fittings Sh. 800,000
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