FALCON ENTERPRISE is a trading business and has been in operation for many years It has...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
FALCON ENTERPRISE is a trading business and has been in operation for many years It has prepared its final accounts as shown below: Balance Sheet as at 31 March: Current assets Cash at bank - 2021 000.$ S'000 2020 $'000 $'000 20 150 Accounts receivable ---- 300 280 Inventory --- 580 470 900 900 Non-current assets Land --- Motor vehicle -.. 200 --- --- 510 360 (280) (160) Less: Accumulated depreciation Office equipment --- Less: Accumulated depreciation 230 200 260 220 --- (80) 180 (70) 150 1,250 TOTAL ASSETS 1,510 Current liabilities Insurance payable- Salary payable -- Accounts payable - 10 20 --- --- 200 140 --- 370 300 460 --- --- 580 Non-current liabilities Notes payable --- TOTAL LIABILITIES 700 400 (1.280) 230 (860) 390 NET ASSETS Owner's Equity Beginning capital --- Add: Net Profit --- Less: Drawings -- Ending capital 390 300 - -- 20 90 --- (180) 230 390 FALCON ENTERPRISE: Income Statement for the vear ended 31 March 2021 000.$ s'000 Sales --- --- 9.800 Less: Cost of goods sold - Gross profit --- Add: Profit on disposal of office equipment (7.000) 2,800 --- 2,802 Less: Expenses Interest expenses Insurance expense --- Depreciation expenses --- Salary expense --- Rent expense --- Sundry expenses --- Net Profit 40 --- --- --- --- 90 150 --- --- --- 1,714 --- --- -- --- --- --- 780 ... --- 2.782 20 --- --- --- ----- --- --- --- Additional data provided by FALCON ENTERPRISE: (i) The interest expenses, rent expense and sundry expenses were paid as they arose. (ii) FALCON ENTERPRISE bought a few brand-new motor vehicles for $150,000 cash. (ii) During the financial year FALCON ENTERPRISE bought land for $200,000 cash. (iv) FALCON ENTERPRISE sold office equipment for $2,000 cash. Its original cost was $20,000 and its accumulated depreciation was $20,000. FALCON ENTERPRISE bought new office equipment for $60,000 cash. REQUIRED: (a) Prepare a detailed Cash Flow Statement of FALCON ENTERPRISE for the year ended 31 March 2021. (16 marks) (b) The owner of FALCON ENTERPRISE could not understand the cash flow statement. Interpret the cash flow statement that you have prepared to him. (4 marks) FALCON ENTERPRISE is a trading business and has been in operation for many years It has prepared its final accounts as shown below: Balance Sheet as at 31 March: Current assets Cash at bank - 2021 000.$ S'000 2020 $'000 $'000 20 150 Accounts receivable ---- 300 280 Inventory --- 580 470 900 900 Non-current assets Land --- Motor vehicle -.. 200 --- --- 510 360 (280) (160) Less: Accumulated depreciation Office equipment --- Less: Accumulated depreciation 230 200 260 220 --- (80) 180 (70) 150 1,250 TOTAL ASSETS 1,510 Current liabilities Insurance payable- Salary payable -- Accounts payable - 10 20 --- --- 200 140 --- 370 300 460 --- --- 580 Non-current liabilities Notes payable --- TOTAL LIABILITIES 700 400 (1.280) 230 (860) 390 NET ASSETS Owner's Equity Beginning capital --- Add: Net Profit --- Less: Drawings -- Ending capital 390 300 - -- 20 90 --- (180) 230 390 FALCON ENTERPRISE: Income Statement for the vear ended 31 March 2021 000.$ s'000 Sales --- --- 9.800 Less: Cost of goods sold - Gross profit --- Add: Profit on disposal of office equipment (7.000) 2,800 --- 2,802 Less: Expenses Interest expenses Insurance expense --- Depreciation expenses --- Salary expense --- Rent expense --- Sundry expenses --- Net Profit 40 --- --- --- --- 90 150 --- --- --- 1,714 --- --- -- --- --- --- 780 ... --- 2.782 20 --- --- --- ----- --- --- --- Additional data provided by FALCON ENTERPRISE: (i) The interest expenses, rent expense and sundry expenses were paid as they arose. (ii) FALCON ENTERPRISE bought a few brand-new motor vehicles for $150,000 cash. (ii) During the financial year FALCON ENTERPRISE bought land for $200,000 cash. (iv) FALCON ENTERPRISE sold office equipment for $2,000 cash. Its original cost was $20,000 and its accumulated depreciation was $20,000. FALCON ENTERPRISE bought new office equipment for $60,000 cash. REQUIRED: (a) Prepare a detailed Cash Flow Statement of FALCON ENTERPRISE for the year ended 31 March 2021. (16 marks) (b) The owner of FALCON ENTERPRISE could not understand the cash flow statement. Interpret the cash flow statement that you have prepared to him. (4 marks)
Expert Answer:
Answer rating: 100% (QA)
solution of both the parts is given below CASH FLOW STATEMENT YEAR ENDING MARCH 2021 CASH FLOW FROM ... View the full answer
Related Book For
Posted Date:
Students also viewed these accounting questions
-
A project has been in operation for 5 years, yielding the following annual cash flows Year Cash Flow 0.................-$103,000 1....................102,700 2....................-87,000...
-
For many years it was illegal to color margarine yellow (margarine is naturally white). In some states, margarine manufacturers were even required to color margarine pink! Who do you think supported...
-
A 3.0-MV transmission electron microscope has been in operation at Osaka University in Japan for several years. The higher-energy electrons allow for deeper sample penetration and extremely high...
-
Which of the following quadratic equations is in standard form? (a) x 2 7x = 5 (b) 9 = x (c) (x + 5)(x - 4) = 0 (d) 0 = 5x - 6x - 1
-
Morris Zapp and Philip Swallow consume wine and books. Morris has an initial endowment of 60 books and 10 bottles of wine. Philip has an initial endowment of 20 books and 30 bottles of wine. They...
-
What are some difficulties encountered when attempting project control?
-
If you had been treated with respect, this would never have happened, would it?
-
Iron Man began August with 65 units of iron inventory that cost $30 each. During August, the company completed the following inventory transactions: Requirements 1. Prepare a perpetual inventory...
-
2 Charlie's Crispy Chicken (CCC) operates a fast-food restaurant. When accounting for its first year of business, CCC created several accounts. Account Name Description Balance Accounts Payable...
-
Here is a simplified diagram of a RF front end (power and control signals are not shown). 1. What kind of a system is it? What are the RF measurements you would use to characterize it and compare it...
-
What are the key core competencies that MOCROSOFT possesses? (Please present no more than three) Please explain how they meet one or more of the four criteria that determine core competencies, and...
-
Before boarding an El Al Israel Airlines fl ight from New York to Tel Aviv, Tseng, a passenger, was physically subjected to an intrusive security search. Although not injured bodily, Tseng sued El Al...
-
Indicate whether each of the following statements is true or false by writing T or F i n t he a nswer c olumn. The Clean Air Act of 1970 deals only with pollution within the boundaries of each state.
-
Forrer was an employee of Sears for many years. He eventually left because of health problems and began operating a farm. Sears persuaded Forrer to return to work on a part-time basis, and about one...
-
Jackson, a widow who was desperate for money, sold land to her brother, Seymour, for $275. Later, Seymour found valuable timber on the land and sold some of it for $2,353. When Jackson realized that...
-
Doran, a young man of 17, married a 17-year-old woman. After the wedding they moved to another city, where they both found work and began to buy furniture and appliances. When they realized that they...
-
Consider the following observation: The stopping distance for a car is much shorter than for a train going the same speed?. For the following questions, assume purely horizontal motion with the...
-
The activities listed in lines 2125 serve primarily as examples of A) Underappreciated dangers B) Intolerable risks C) Medical priorities D) Policy failures
-
Lets consider a case that has some similarities to Figure 35.2. We mentioned that its difficult for the Fed to know whats really happening to the economy in real time. This is similar to the...
-
The utility-maximizing bundle of goods is found at the point of tangency between the budget constraint and an indifference curve. In the following diagram, the utility-maximizing bundle is the one...
-
a. If the debt-to-GDP ratio rose to 100% and the interest rate on the debt were 5% per year, what fraction of GDP would go toward paying interest on the debt? b. If this happened, would interest on...
-
A control system for controlling the pressure in a closed chamber is shown below, together with its flow graph model. The transfer function for the measuring element is \[ G(s)=\frac{100}{s^{2}+15...
-
The forward-path transfer function of a unity feedback control system is \[G(s)=\frac{K}{s(s+6.54)}\] Analytically, find the resonant peak \(M_{\text {peak }}\), resonant frequency \(\omega_{r}\),...
-
Draw a Nyquist diagram for each of the following systems and compare the result with that obtained using the MATLAB command Nyquist. (a) \(K G(s)=\frac{K(s+2)}{s+10}\) (b) \(\quad K...
Study smarter with the SolutionInn App