Here are the financial statements of Diamond Ltd on 31 December 20x7:

Additional information:

1. Favourable market conditions enabled the company to place 200 000 ordinary shares privately with institutional investors at 55c/share, and also to issue 60 000 6%-preference shares to the public at R1/share.

– The issue of new shares was to redeem the mortgage debentures.

– The company paid share issue expenses of R1 000 and this amount was written off at 31 December 20x7.

2. The company had sold a small plot in December 20x7. The cost of the land disposed of was R4 000. (No other fixed assets were sold or scrapped during the year.)

3. Included in the profit before taxation is interest paid (R5 400), and interest received (R1 300).

4. Dividends declared consists of:

You are required to:

Prepare a statement of cash flows and notes for the year ended 31 December 20x7.

Transcribed Image Text:

Diamond Ltd ABRIDGED STATEMENT OF PROFIT OR LOSS & OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 20x7 Notes Revenue Cost of sales Operating profit (including profit on sale of land) before taxation Taxation - normal tax for the current year PROFIT FOR THE YEAR 20x7 239 000 00 (194 000 00) 45 000 00 (9 500 00) 35 500 00