TODAY’S LESSON

Preparing cash flow statement

Statement of cash flows for the year ended 31 March 2020 Notes
Cash-flows from operating activities IAS 7:
CASHFLOWS FROM OPERATING ACTIVITIES
Operating loss (10000) -cash generated from trading activities
Depreciation; Property 100000 -adjustments for non cash items eg depreciation
Depreciation motor vehicles 136000 -changes in working capital (current assets and
current liabilities)
Loss on disposal (240-108= 132-130) 2000
Increase in inventory (108-82) (26000) CASHFLOWS FROM INVESTING ACTIVITIES
-cash inflows/outflows from disposal/ purchase of
Increase in trade receivables (90-72) (18000)
non current assets+ long term investments
Decrease in trade payables (108-52) (56000) -dividend received
138000
CASHFLOWS FROM FINANCING ACTIVITIES
- Sources of finance- shares+ long term liabilities
Cash generated from operations 128000 - Dividends paid
Less taxation paid 0 (a) profit/loss for the year
Retained profit b/f 30000
Less interest paid 0
Add/ less profit/(loss) for the year (10000)
20000
Net cash flow from operating activities 128000 Less dividends paid (5000)
Retained profit c/f 15000
Statement of cash flows for the year ended 31 March 2020
Net cash flow from operating activities 128000 Notes
Cash flow from investing activities CASHFLOWS FROM INVESTING ACTIVITIES
-cash inflows/outflows from disposal/ purchase of
Purchase of motor vehicles (808000)
non current assets+ long term investments
Cash received on disposal of motor vehicle 130000 -dividend received

CASHFLOWS FROM FINANCING ACTIVITIES

Net cash flow from investing activities (678000) - Sources of finance- shares+ premium + long term
Cash flows from financing activities liabilities
Dividends paid (5000) - Dividends paid

Issue of shares (400000+20000) 420000

Redemption of debentures (200-120) (80000) - Issue of shares
Net cash flow from financing activities 335000 - Bonus issue: share premium(-50000)= 0
- Bonus issue is a non-cash item
Net decrease in cash & cash equivalents (215000) - Rights issue (1450000-50000)- 1000000= 400000
+ Cash & cash equivalents at start of the year 174000 - 20000-0= 20000
Closing balance of cash & cash equivalents (41000)
Statement of cash flows for the year ended 31 March 2012
Notes:
Cash-flows from operating activities
Nbv= 172000-101000= 71000
Operating profit 636000
Depreciation: equipment 126000
Profit on disposal (19000)
Decrease in inventory 29000 Bal b/d 610000 Disposal 71000

Increase in trade receivables (42000) Cash 507000 depreciation 126000

Increase in Trade payables 11000 Bal c/d 920000

Increase in Others payables (55-43) 12000 1117000 1117000

117000

Cash generated from operations 753000

-Tax paid (195+220-220) (195000)

-Interest paid (11000+61000-21000) (51000)
Net cash flow from operating activities 507000
Statement of cash flows for the year ended 31 March 2012
Net cash flow from operating activities 507000 Notes
Cash flow from investing activities NBV on equipment= 71000+
Profit on disposal 19000
Acquisition of patents (220-180) (40000)
Cash on disposal = 90000
Purchases of equipment (507000)
Cash on Disposal of equipment 90000
Bonus issue: share premium (-50000)= 0
Net cash flow from investing activities (457000) Rights issue: (1500000-50000)-1200000=250000
Cash flows from financing activities Share premium= 50000-0= 50000
Issue of shares + premium on issue(250+50) 300000
Issue of debentures (500-400) 100000
-Dividends paid (300000)
Net cash flow from financing activities 100000
Net increase in cash & cash equivalents 150000
+ Cash & cash equivalents at start of the year (21000)
Closing balance of cash & cash equivalents 129000