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Cashflow Question

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22 views

Cashflow Question

Uploaded by

Prince Daniels Tutor
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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CASHFLOW QUESTION

Details of Mukula Plc’s draft financial statements, together with other relevant
information are shown below:

Statement of Profit or Loss for the Year Ended 31 March 2020

K’Million
Revenue 946
Cost of Sales (458)
Gross Profit 488
Distribution costs (152)
Administrative expenses (96)
Finance income 12
Finance costs (34)
Profit before tax 218
Income tax expense (94)
Profit after tax 124

STATEMENT OF FINANCIAL POSITION AS AT 31 MARCH


2020

2020 2019
K’million K’million
Non-current assets
Property, plant and equipment 654 528

Current assets
Inventories 246 352
Trade receivables 190 174
Short term investments 130 60
Cash at bank and in hand 58 0
624 586
1,278 1,114
Equity
Share capital of K1 per share 400 240
Share premium 60 0
Revaluation surplus 132 194
Retained earnings 142 82

PRINCE DANIELS 2023


Total Equity 734 516

Non-current liabilities
10% debentures 200 300

Non-current liabilities 344 298


Total liabilities 544 598
Total Equity and liabilities 1,278 1,114
The following notes are also relevant:

1. During the year ended 31 March 2020, items of Property, plant and
equipment which originally cost K80 million were disposed of at a loss of K12
million. These items had a carrying value of K56 million at the date of disposal.

2. Current liabilities consist of the following:

2020 2019
K’m K’m
Bank overdraft 0 44
Trade payables 252 140
Interest payable 14 6
Income tax payable 78 108
344 298

3. On 1 August 2019, K100 million of 10% debentures was converted into K100
million K1 ordinary shares.

4. The depreciation charge for the year included in the Profit or loss was K86
million.

Required:

(a) Prepare a Statement of cash flows for Mukula plc for the year ended
31 March 2020 using the indirect method.
(b) Calculate any five ratios of your own

PRINCE DANIELS 2023

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