The following is the Income Statement of Falcon Ltd for the year ended 31 Dec 2021: 2021
Question:
The following is the Income Statement of Falcon Ltd for the year ended 31 Dec 2021:
2021 | |
£'000 | |
Revenue | 15,650 |
Cost of sales | (8,500) |
Gross profit | 7,150 |
Expenses | (1,200) |
Interest expense | (42) |
Profit before tax | 5,908 |
Tax expense | (1,200) |
Profit after tax | 4,708 |
The following is the Statement of Financial Position of Falcon Ltd as at 31 Dec 2020 and 2021:
2020 | 2021 | |
ASSETS | £'000 | £'000 |
Non-current Assets | ||
Land | 2,650 | 2,670 |
Equipment Cost | 2,000 | 2,620 |
Less: Accum.Depreciation | (400) | (770) |
Net Book Value of Equipment | 1,600 | 1,850 |
Current Assets | ||
Inventories | 1,350 | 1,400 |
Trade Receivables | 200 | 156 |
Cash | 120 | 5,479 |
Total Assets | 5,920 | 11,555 |
EQUITIES AND LIABILITIES | ||
Share Capital - £1 shares | 3,000 | 3,500 |
Share premium | 1,500 | 1,750 |
Revaluation Reserve | 200 | 220 |
Retained Earnings | 170 | 4,740 |
Current Liabilities | ||
Trade Payables | 125 | 80 |
Tax Payable | 900 | 1,200 |
Interest Payable | 25 | 20 |
Non- current Liabilities | ||
Debenture Loan | 0 | 45 |
Total Equity and Liabilities | 5,920 | 11,555 |
You are informed that:
a)Equipment that originally cost £300,000 was sold for cash of £350,000. Accumulated depreciation relating to the plant sold amounted to £50,000. The profit/loss on disposal is included in expenses in Income Statement.
b)The company issued 500,000 ordinary shares at a price of £1.5 each.
c)Dividend payment for the year was £138,000.
d)Increase in Land's value of £20,000 relates to its revaluation during this year.
Required:
Prepare the complete statement of cash flows for Falcon Ltd for the year ended 31 Dec 2021. Show supporting workings.
Expert Answer:
