The following are the financial statements for Nailsea plc for the years ended 30 June 2014 and
Question:
Income statement for years ended 30 June
Statements of financial position as at 30 June
There were no disposals of non-current assets in either year. Dividends were paid in 2014 and 2015 of £40 million and £45 million respectively.
Required:
Prepare a statement of cash flows for Nailsea plc for the year ended 30 June 2015.
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...
2014 2015 £m 2,280 (1,618) £m Revenue 1,230 (722) Operating expenses Depreciation Operating profit _(320) (270) 238 342 Interest payable Profit before taxation Taxation Profit for the year (27) 238 315 (110) (140) 128 175 2014 2015 £m £m ASSETS Non-current assets Property, plant and equipment (at carrying amount) Land and buildings Plant and machinery 1,500 1,900 810 740 2,310 2,640 Current assets Inventories 275 450 Trade receivables 100 250 Bank 118 375 818 Total assets 2,685 3,458 EQUITY AND LIABILITIES Equity Share capital (fully paid £1 shares) Share premium account Retained eamings 1,400 1,600 200 300 828 958 2,428 2,858 Non-current liabilities Borrowings - 9% loan notes (repayable 2019) 300 Current liabilities Borrowings (all bank overdraft) Trade payables Taxation 32 170 230 70 55 257 300 Total equity and liabilities 2,685 3,458
Step by Step Answer:
Statement of cash flows for the year ended 30 June 2015 To see how this relates to the cash of the business at the beginning and end of the year it ca...View the full answer
Accounting and Finance An Introduction
ISBN: 978-1292088297
8th edition
Authors: Peter Atrill, Eddie McLaney
Related Video
Depreciation of non-current assets is the process of allocating the cost of the asset over its useful life. The cost of the asset includes the purchase price, any additional costs incurred to bring the asset to its current condition and location, and any other costs that are directly attributable to the asset. The useful life of the asset is the period over which the asset is expected to be used by the company. To calculate the depreciation, companies use different methods such as straight-line, declining-balance, sum-of-the-years\'-digits, units-of-production, and group depreciation. The chosen method will depend on the type of asset, the company\'s accounting policies, and the accounting standards that are applicable. The straight-line method allocates an equal amount of the asset\'s cost over its useful life, while the declining-balance method calculates depreciation at a fixed rate, typically double the straight-line rate, but the amount of depreciation decreases over time. The sum-of-the-years\'-digits method is similar to the declining-balance method, but the rate of depreciation is calculated using a fraction that is based on the useful life of the asset. It\'s important to note that the depreciation expense will be recorded on the company\'s income statement and the accumulated depreciation will be recorded on the company\'s balance sheet. This will decrease the value of the asset on the balance sheet over time.
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