The following summarized accounts have been prepared for Pill Limited: Additional information: 1. There were no sales
Question:
The following summarized accounts have been prepared for Pill Limited:
Additional information:
1. There were no sales of fixed assets during the year ended 31 May 2011.
2. The debentures were paid back at the beginning of the year.
Required:
(a) Compile Pill Limited's cash flow statement for the year ended 31 May 2011.
(b) What does it tell the managers of PillLimited?
Transcribed Image Text:
Profit and loss account for the year ended 31 May 2011 2010 2011 Sales Less Cost of goods sold Gross profit Less Expenses: Administrative expenses Depreciation: vehicles 2400 1600 800 3000 2000 1000 310 320 furniture 35 400 400 120 280 200 80 40 420 580 150 430 250 180 Net profit Taxation Dividends Retained profits for the year Balance sheet at 31 May 2011 31.5.10 31.5.11 5000 £000 Fixed assets Vehicles at cost Less: Depreciation Furniture Less: Depreciation 800 200 200 100 540 250 140 100 110 500 650 Current assets Stocks Debtors Cash 400 180 320 900 540 200 120 860 Less: Current liabilities Creditors Corporation tax Proposed dividends 270 170 150 590 100 310 810 620 240 Capital and reserves Ordinary share capital Profit and loss account Shareholders' funds Loans Debentures (1096) 500 120 620 550 850 190 810 40 890
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