Here are the financial statements of Diamonds Ltd on 30 September 2018. Diamond Ltd Abridged statement...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Here are the financial statements of Diamonds Ltd on 30 September 2018. Diamond Ltd Abridged statement of profit or loss and other comprehensive income for the year ended 30 September 2018 N$ Gross profit Other operating expenses Operating profit Operating income Profit on sale of equipment 2,400,000.00 (1.580,000.00) 820,000.00 12,000.00 Profit from operations Financing activities 832,000.00 Investment income - dividends Interest on mortgage bond 68,000.00 (164,000.00) Profit before tax 736,000.00 Income tax Profit for the year Other comprehensive income Re-valuation of land buildings (187,040.00) 548,960,00 850,000.00 Total comprehensive income 1,398,960.00 Page 24 of 27 Diamond Ltd Statement of financial position as at 30 September 2018 N$ N$ 2018 2017 ASSETS 2,940,000.00 2,620,000.00 Non-current assets 4,416,400.00 3,782,000.00 PPE Investments at costs 634,400.00 320,000.00 Current assets Inventory Trade receivables 2,685,000.00 825,000.00 2,750,000.00 675,000.00 Cash and cash equivalents 70,560.00 7,996,960.00 29,000.00 6,394,000,00 TOTAL ASSETS EQUTY AND LIABILITIES Equity & reserves Share capital Reserves Retained earnings 5,060,960.00 3,972,000.00 2,275,000.00 200,000.00 2,500,000.00 995,000.00 1,565,960.00 1,497,000.00 1,750,000.00 1,750,000.00 Non-current liabilities 1,200,000.00 Mortgage bond 1,200,000.00 Current liabilities Trade payables Inland revenue - Income Tax Shareholders for dividends 645,000.00 720,000.00 61,000.00 408,000.00 92,000.00 348,500.00 Inland Revenue - dividends withholding tax 72,000.00 7,996,960,00 61.500.00 6,394,000.00 TOTAL EQUITY AND LIABILITIES Additional information: 1. The company maintains a gross profit percentage of 40 % on sales. 2. Other operating expenses include: Depreciation on equipment N$ 164 000 and Loss on scrapping of equipment - NS 16 000 3. The authorized share capital consist of: 5 000 000 no par value ordinary shares 2 500 000 8% redeemable preference shares with a par value of NS 2.25. 4. Issued share capital consists of: 2018 2017 N$ N$ Stated capital 1,600,000.00 1,150,000.00 8% Redeemable preference shares 900,000.00 1,125,000.00 2,500,000.00 2,275,000.00 The original issue of ordinary shares was at N$ 1.15 5. Reserves consist of the following: 2018 2017 N$ N$ Share premium 145,000.00 200,000.00 Revaluation reserve 850,000.00 995,000.00 200,000.00 6. It is the company policy to declare dividends at the end of the financial year with the payment being made during the month of October in the following financial year. 7. Immediately after the dividends were declared, the company redeemed 100 000 redeemable preference shares at N$ 2.80 each. This was partially financed by the issue of 200 000 ordinary shares at NS 1.25 each. An additional issue of ordinary shares at NS 1,25 cach. An additional issue of ordinary shares was made during the same price to help finance the purchase of Land and Buildings, which were purchased to expand the operations. 8. The carrying values of PPE were: 2018 2017 NS NS Land & Buildings 3,000,000.00 1,800,000.00 Page 26 of 27 Equipment 782,000.00 820,000.00 3,782.000.00 2.620,000.00 9. Land and buildings were revalued for the first time during the current financial year. Equipment with the cost price of NS 80 000 and accumulated depreciation of NS 62 000 was sold during the year and replaced with new equipment. Equipment with a book value of NS 16 000 was scrapped during the financial year. You are required to: 1. Prepare a statement of Cash Flow for Diamond Ltd for the year ended 30 September 2018 to conform to the requirement of IAS 7 using direct method. Show all your workings. (25 marks) 2. Prepare the note reconcile the profit before tax to cash generated from operating activities. (11 marks) Here are the financial statements of Diamonds Ltd on 30 September 2018. Diamond Ltd Abridged statement of profit or loss and other comprehensive income for the year ended 30 September 2018 N$ Gross profit Other operating expenses Operating profit Operating income Profit on sale of equipment 2,400,000.00 (1.580,000.00) 820,000.00 12,000.00 Profit from operations Financing activities 832,000.00 Investment income - dividends Interest on mortgage bond 68,000.00 (164,000.00) Profit before tax 736,000.00 Income tax Profit for the year Other comprehensive income Re-valuation of land buildings (187,040.00) 548,960,00 850,000.00 Total comprehensive income 1,398,960.00 Page 24 of 27 Diamond Ltd Statement of financial position as at 30 September 2018 N$ N$ 2018 2017 ASSETS 2,940,000.00 2,620,000.00 Non-current assets 4,416,400.00 3,782,000.00 PPE Investments at costs 634,400.00 320,000.00 Current assets Inventory Trade receivables 2,685,000.00 825,000.00 2,750,000.00 675,000.00 Cash and cash equivalents 70,560.00 7,996,960.00 29,000.00 6,394,000,00 TOTAL ASSETS EQUTY AND LIABILITIES Equity & reserves Share capital Reserves Retained earnings 5,060,960.00 3,972,000.00 2,275,000.00 200,000.00 2,500,000.00 995,000.00 1,565,960.00 1,497,000.00 1,750,000.00 1,750,000.00 Non-current liabilities 1,200,000.00 Mortgage bond 1,200,000.00 Current liabilities Trade payables Inland revenue - Income Tax Shareholders for dividends 645,000.00 720,000.00 61,000.00 408,000.00 92,000.00 348,500.00 Inland Revenue - dividends withholding tax 72,000.00 7,996,960,00 61.500.00 6,394,000.00 TOTAL EQUITY AND LIABILITIES Additional information: 1. The company maintains a gross profit percentage of 40 % on sales. 2. Other operating expenses include: Depreciation on equipment N$ 164 000 and Loss on scrapping of equipment - NS 16 000 3. The authorized share capital consist of: 5 000 000 no par value ordinary shares 2 500 000 8% redeemable preference shares with a par value of NS 2.25. 4. Issued share capital consists of: 2018 2017 N$ N$ Stated capital 1,600,000.00 1,150,000.00 8% Redeemable preference shares 900,000.00 1,125,000.00 2,500,000.00 2,275,000.00 The original issue of ordinary shares was at N$ 1.15 5. Reserves consist of the following: 2018 2017 N$ N$ Share premium 145,000.00 200,000.00 Revaluation reserve 850,000.00 995,000.00 200,000.00 6. It is the company policy to declare dividends at the end of the financial year with the payment being made during the month of October in the following financial year. 7. Immediately after the dividends were declared, the company redeemed 100 000 redeemable preference shares at N$ 2.80 each. This was partially financed by the issue of 200 000 ordinary shares at NS 1.25 each. An additional issue of ordinary shares at NS 1,25 cach. An additional issue of ordinary shares was made during the same price to help finance the purchase of Land and Buildings, which were purchased to expand the operations. 8. The carrying values of PPE were: 2018 2017 NS NS Land & Buildings 3,000,000.00 1,800,000.00 Page 26 of 27 Equipment 782,000.00 820,000.00 3,782.000.00 2.620,000.00 9. Land and buildings were revalued for the first time during the current financial year. Equipment with the cost price of NS 80 000 and accumulated depreciation of NS 62 000 was sold during the year and replaced with new equipment. Equipment with a book value of NS 16 000 was scrapped during the financial year. You are required to: 1. Prepare a statement of Cash Flow for Diamond Ltd for the year ended 30 September 2018 to conform to the requirement of IAS 7 using direct method. Show all your workings. (25 marks) 2. Prepare the note reconcile the profit before tax to cash generated from operating activities. (11 marks)
Expert Answer:
Answer rating: 100% (QA)
Answer Solution Cash flow statement using direct method a... View the full answer
Related Book For
Intermediate Accounting principles and analysis
ISBN: 978-0471737933
2nd Edition
Authors: Terry d. Warfield, jerry j. weygandt, Donald e. kieso
Posted Date:
Students also viewed these accounting questions
-
Statement of profit or loss and other comprehensive income Year ended 31 Nine-month Dec-18 period ended 31 Dec-17 Revenue 2,200,228 1,561,138 Cost of sales -1,199,154 -877,354 Gross profit 1,001,074...
-
Here are the financial statements of YoYo Company. Additional data: 1. Dividends of $36,000 were declared and paid. 2. During the year equipment was sold for $10,000 cash. This equipment cost $15,000...
-
The following are the financial statements of the parent company Alpha plc, a subsidiary company Beta and an associate company Gamma. On 1 January 20X5 Alpha plc acquired 80% of Beta plc for...
-
Elena, a student in F-1 immigration status from Romania, is on the basketball team. She arrived in the U.S. on June 18, 2023 on a full athletic scholarship that includes $10,000 for her room and...
-
Vicinal halo alcohols (halohydrins) can be synthesized by treating epoxides with HX. (a) Show how you would use this method to synthesize 2-chlorocyclopentanol from cyclopentene. (b) Would you expect...
-
On January 1, 2017, Prasad SpA had the following equity accounts. Share Capital-Ordinary (25 par value, 48,000 shares issued and outstanding)....1,200,000 Share...
-
Farmer D. Jones has a crop of grapefruit that will be ready for harvest and sale as 150,000 pounds of grapefruit juice in 3 months. Jones is worried about possible price changes, so he is considering...
-
During the first-year audit of Jones Wholesale Stationery, you observe that commissions amount to almost 25 percent of total sales, which is somewhat higher than in previous years. Further...
-
Discuss the concepts of mean, median, mode, and standard deviation. Include when each should be used and evaluate the differences of each.
-
In the given carbon skeleton structure below. identify the carbon atom(s) with sp3 hybradization. H
-
The average annual return on an Index from 1996 to 2005 was 19.31 percent. The average annual T-bill yield during the same period was 3.91 percent. What was the market risk premium during these ten...
-
Identify the y-intercept of f (x) = 23-7x23x+14 22+4x-7
-
two boats A and B travel due north. initially boat B is positioned 50 metres due east of boat A. The distance travelled by boat A and Boat B, after t seconds, are x metres and y metres respectively....
-
It is known that the proportion of female costumers in Westpac is 40%. The General Manager is interested in some probabilities. Determine What is the probability that in a randomly selected sample in...
-
The mortgage company requires a 14% down payment on houses it finances. If the Sumis bought a house for $123,000, how much down payment did they have to make? The Sumis had to make a down payment of $
-
Pepper earns interest at a nominal rate of 7.25% compounded semi-annually. A 0.1% expense is charged semi-annually to the account immediately after the interest is earned. What annual effective yield...
-
10 Henderson Company uses the gross profit method to estimate ending inventory and cost of goods sold when preparing monthly financial statements required by its bank. Inventory on hand at the end of...
-
A condenser (heat exchanger) brings 1 kg/s water flow at 10 kPa quality 95% to saturated liquid at 10 kPa, as shown in Fig. P4.91. The cooling is done by lake water at 20C that returns to the lake at...
-
(Accounting Numbers and the Environment) Hardly a day goes by without an article appearing on the crises affecting many of our financial institutions in the United States. It is estimated that the...
-
Where there is evidence that the utility of inventory goods, as part of their disposal in the ordinary course of business, will be less than cost, what is the proper accounting treatment?
-
The adjusted trial balance for Ed Bradley Co. is presented in the following worksheet for the month ended April 30, 2008. Instructions Complete the worksheet and prepare a classified balancesheet. Ed...
-
When randomly selecting a day of the week, it is certain that you will select a day containing the letter y, so P(y) = 1. For Exercises 510, decide whether the statement makes sense (or is clearly...
-
If there is a 0.9 probability that it will rain sometime today, then there is a probability of 0.1 that it will not rain sometime today. For Exercises 510, decide whether the statement makes sense...
-
What do we mean when we say that the probability of getting 20 babies of the same gender when 20 random babies are born is 1/524,288? Is such an event unusual? Why or why not?
Study smarter with the SolutionInn App