The following draft financial statements are available for Sipfalor plc for the year ended 31 May 2018:

Statement of financial position at 31 May 2018.

Statement of profit or loss for the year to 31 May 2018.

                                                                          £
Revenue.............................................. 43,380,756
Cost of sales..................................... (25,050,812)
                                                           €“€“€“€“€“€“€“€“€“€“
Gross profit.......................................... 18,329,944
Operating expenses.......................... (15,833,481)
                                                           €“€“€“€“€“€“€“€“€“€“
Operating profit.....................................2,496,463
Interest paid........................................... (812,500)
                                                           €“€“€“€“€“€“€“€“€“€“
Profit before tax................................... 1,683,963
Taxation................................................... (278,793)
                                                           €“€“€“€“€“€“€“€“€“€“
Profit for the year................................ 1,405,170
                                                           €“€“€“€“€“€“€“€“€“€“

Sipfalor plc presents a separate statement of profit or loss for the year (as above) and a separate statement of comprehensive income.

The following additional information for the year ended 31 May 2018 is available:

1). Dividends paid during the year were £680,000.

2). Non-current assets which had cost £332,100 and which had a carrying value of £55,940 were sold for £45,000. Any surpluses or deficits on the disposal of noncurrent assets have been included in the depreciation charge for the year. Other movements in non-current assets are due to purchases of new assets and revaluations.

3). "Other current assets" consists of prepaid insurance. "Other payables" consists of accrued wages and salaries.

Required:

Prepare a statement of cash flows for Sipfalor plc for the year ended 31 May 2018 in accordance with IAS7 Statement of Cash Flows using the direct method. Additional notes are not required. Ignore VAT.

(CIPFA)

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2018 2017 £ Assets Non-current assets at cost or valuation 81,535,730 16,677,788 57,754,170 12,687,297 Less: Accumulated dep'n 64,857,942 45,066,873 Current assets Inventory 389,500 467,800 1,540 64,640 412,350 558,400 2,560 2,702,204 3,675,514 Trade receivables Other current assets Cash and cash equivalents 923,480 Total assets 45,990,353 68,533,456 Equity Issued share capital Share premium Revaluation reserve 35,000,000 5,500,000 1,000,000 18,421,923 20,000,000 1,500,000 800,000 17,696,753 Retained earnings 59,921,923 39,996,753 Liabilities Non-current liabilities Debentures 7,500,000 359,800 7,859,800 5,000,000 289,500 5,289,500 Deferred tax Current liabilities Trade payables Other payables Current tax payable 309,800 4,560 389,740 409,800 5,140 336,793 751,733 704,100 45,990,353 Total equity and liabilities 68,533,456