Question: Question 3 (20 Marks) Use the information provided below to prepare the Cash Flow Statement of Chelsea Limited for the year ended 31 December 2021.
Question 3 (20 Marks)
Use the information provided below to prepare the Cash Flow Statement of Chelsea Limited for the year ended 31
December 2021.
INFORMATION
PEPSICO LIMITED
STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER:
2021 (R) 2020 (R)
Sales 3 312 000 2 800 000
Cost of sales (1 616 000) (1 560 000)
Gross profit 1 696 000 1 240 000
Selling and administrative expenses (672 000) (568 000)
Operating profit 1 024 000 672 000
Interest expense (64 000) (32 000)
Profit before tax 960 000 640 000
Tax (256 000) (172 000)
Profit after tax 704 000 468 000
LIST OF BALANCES FROM THE STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER:
2021 (R) 2020 (R)
Land and buildings 1 760 000 1 504 000
Plant and machinery 992 000 848 000
Investments 240 000 0
Inventories 384 000 400 000
Accounts receivable 408 000 256 000
Cash and cash equivalents 72 000 64 000
Ordinary share capital 1 600 000 1 600 000
Retained earnings 896 000 480 000
Long-term loan 640 000 320 000
Accounts payable 384 000 448 000
Income tax payable 128 000 64 000
Dividends payable 208 000 160 000
Additional information
Selling and administrative expenses include depreciation as follows:
Depreciation on buildings R96 000
Depreciation on plant and machinery R160 000
There were purchases but no disposals of property, plant and equipment for the financial year ended 31 December
2021.
Total dividends for the year ended 31 December 2021 and 31 December 2020 amounted to
R288 000 and R388 000 respectively.
Inventories on 31 December 2019 amounted to R560 000.
All purchases and sales of inventories were on credit.
The number of shares in issue was 400 000.
Credit terms from creditors are 90 days.
QUESTION 3 (20 Marks)
| CHELSEA LIMITED | |||
| CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2021 | |||
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| Cash flows from operating activities |
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| Profit before interest and tax/Operating profit |
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| Adjustments to convert to cash from operations |
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| Profit before working capital changes |
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| Working capital changes |
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| Cash generated from operations |
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| Cash flows from investing activities |
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| Cash flows from financing activities |
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| Cash and cash equivalents at end of year |
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