Bright Sparks (Pty) Ltd is a company based in Cape Town that specialises in buying and...

  

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Bright Sparks (Pty) Ltd is a company based in Cape Town that specialises in buying and selling energy-efficient lighting equipment for residential and commercial use. The company has a 31 December financial year-end. Provided is an extract of the Statement of Profit or Loss and Other Comprehensive Income for the year ended 31 December 2022: Sales Cost of sales Gross profit Operating expenses Operating profit Finance costs Other income Interest received Profit before tax Taxation Profit for the year Notes to the Statement of Profit or Loss: 1. Finance costs The company paid interest on loans, according to Note 5. Current assets Trade receivables Bank Equity Share capital: Class A Retained earnings Non-current liabilities. 2. Other income Other income consists of dividends received during the current financial year. Loans Current liabilities SARS (Income tax) Provided is an extract of the Statement of Financial Position as at 31 December 2022: 2022 R 148 728 1971 162 Notes to the Statement of Financial Position: Note Note HFAC130-1-Jan-June2023-SA1-LVN-V2-20230307 3 4 10 1 2 5 REQUIRED: 1 500 000 ? Rand 2 482 461 (1 090 688) 1 391 773 (430 585) 619 209 ? 50 400 6 000 ? (192 480) 550 000 55 755 2021 R 140 659 443 145 1 500 000 1 567 714 3. Share capital: Class A The company had 360 000 issued shares in 2021. No further shares were issued for the 2022 financial year. • Show all workings clearly. • Always round up to the nearest rand where applicable. 4. Retained earnings (dividends) On 2 January 2022, the directors declared the only dividend for the financial year at a rate of 25 cents per share. The dividend was paid on 2 January 2022 (Ignore dividend tax). 300 000 5. Loans As of 31 December 2021, the company had one outstanding loan amounting to R300 000 with an interest rate of 12% per annum. The loan was settled on 31 December 2022. 37 240 On 30 June 2022, the company obtained a new loan with an interest rate of 9% per annum. The first interest and instalment on the loan will be due for repayment during the 2023 financial year. As of 31 December 2022, the outstanding loan balance is R550 000. Additional information: • Assume Cash paid to suppliers and employees amounted to R1 757 640. • Ignore VAT and dividends tax for this question. HFAC130-1-Jan-June2023-SA1-LVN-V2-20230307 Prepare an extract of the Statement of Cash Flows of Bright Sparks (Pty) Ltd for the financial year ended 31 December 2022, using the direct method. Instructions: • Prepare the Cash flows from operating activities. • Prepare the Cash generated from operations. • Prepare the Net cash flow from operating activities. • Ignore Cash flows from Investing and Financing activities. Bright Sparks (Pty) Ltd is a company based in Cape Town that specialises in buying and selling energy-efficient lighting equipment for residential and commercial use. The company has a 31 December financial year-end. Provided is an extract of the Statement of Profit or Loss and Other Comprehensive Income for the year ended 31 December 2022: Sales Cost of sales Gross profit Operating expenses Operating profit Finance costs Other income Interest received Profit before tax Taxation Profit for the year Notes to the Statement of Profit or Loss: 1. Finance costs The company paid interest on loans, according to Note 5. Current assets Trade receivables Bank Equity Share capital: Class A Retained earnings Non-current liabilities. 2. Other income Other income consists of dividends received during the current financial year. Loans Current liabilities SARS (Income tax) Provided is an extract of the Statement of Financial Position as at 31 December 2022: 2022 R 148 728 1971 162 Notes to the Statement of Financial Position: Note Note HFAC130-1-Jan-June2023-SA1-LVN-V2-20230307 3 4 10 1 2 5 REQUIRED: 1 500 000 ? Rand 2 482 461 (1 090 688) 1 391 773 (430 585) 619 209 ? 50 400 6 000 ? (192 480) 550 000 55 755 2021 R 140 659 443 145 1 500 000 1 567 714 3. Share capital: Class A The company had 360 000 issued shares in 2021. No further shares were issued for the 2022 financial year. • Show all workings clearly. • Always round up to the nearest rand where applicable. 4. Retained earnings (dividends) On 2 January 2022, the directors declared the only dividend for the financial year at a rate of 25 cents per share. The dividend was paid on 2 January 2022 (Ignore dividend tax). 300 000 5. Loans As of 31 December 2021, the company had one outstanding loan amounting to R300 000 with an interest rate of 12% per annum. The loan was settled on 31 December 2022. 37 240 On 30 June 2022, the company obtained a new loan with an interest rate of 9% per annum. The first interest and instalment on the loan will be due for repayment during the 2023 financial year. As of 31 December 2022, the outstanding loan balance is R550 000. Additional information: • Assume Cash paid to suppliers and employees amounted to R1 757 640. • Ignore VAT and dividends tax for this question. HFAC130-1-Jan-June2023-SA1-LVN-V2-20230307 Prepare an extract of the Statement of Cash Flows of Bright Sparks (Pty) Ltd for the financial year ended 31 December 2022, using the direct method. Instructions: • Prepare the Cash flows from operating activities. • Prepare the Cash generated from operations. • Prepare the Net cash flow from operating activities. • Ignore Cash flows from Investing and Financing activities.

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To prepare an indirect method Statement of Cash Flows for Bag Spa Pty Ltd for the financial year ended 31 December 2022 we will follow a stepbystep approach to calculate and present the cash flows fro... View the full answer