ALL ABOARD LTD

The following information has been extracted from the records of All Aboard Ltd. that sells
small boats and boating accessories across the country. The company maintains a gross
profit percentage of 40% on sales. The following information has been extracted for the year
ended 30 September 2013.

All Aboard Ltd

Extract from the statement of profit or loss and other comprehensive income for the
year ended 30 September 2013
R
Gross profit 2 400 000
Other operating expenses (1 580 000)
Operating profit 820 000
Other operating income
Profit on sale of equipment 12 000
Profit from operations 832 000
Financing activities
Investment income – dividends 68 000
Interest on mortgage bond ( 164 000)
Profit before tax 736 000
Income tax ( 187 040)
Profit for the year 548 960
Other comprehensive income
Revaluation of land and buildings 850 000
Total comprehensive income 1 398 960

All Aboard Ltd

Statement of financial position as at 30 September 2013
R R
2013 2012
Assets
Non-current assets 4 416 400 2 940 000
Property, plant and equipment 3 782 000 2 620 000
Investments at costs 634 400 320 000
Current assets 3 580 560 3 454 000
Inventories 2 685 000 2 750 000
Debtors 825 000 675 000
Cash and cash equivalents 70 560 29 000
Total assets 7 996 960 6 394 000
Equity and liabilities
Equity and reserves 5 060 960 3 972 000
Share capital 2 500 000 2 275 000
Reserves 995 000 200 000
Retained earnings 1 565 960 1 497 000
Non-current liabilities 1 750 000 1 200 000
Mortgage bond 1 750 000 1 200 000
Current liabilities 1 186 000 1 222 000
Creditors 645 000 720 000
SARS – income tax 61 000 92 000
Shareholders for dividends 408 000 348 500
SARS – dividend withholding tax 72 000 61 500
Total equity and liabilities 7 996 960 6 394 000
Additional information at 30 September 2013:
1. Other operating expenses include:
Depreciation on equipment – R164 000
Loss on scrapping of equipment – R16 000
2. The authorised share capital consists of:
• 5 000 000 no par value ordinary shares
• 2 500 000 8% redeemable preference shares with a par value of R2.25.
3. Issued share capital consists of:
2013 2012
R R
Stated share capital 1 600 000 1 150 000
Preference shares 900 000 1 125 000
2 500 000 2 275 000
The original issue of ordinary shares was at R1.15.
4. Reserves consist of the following:
2013 2012
R R
General reserve 145 000 200 000
Revaluation reserve 850 000 -
995 000 200 000
5. It is the company’s policy to declare dividends at the end of the financial year with the
payment being made during the month of October in the following financial year.
6. Immediately after the dividends were declared, the company redeemed 100 000
redeemable preference shares at R2.80 each. This was partially financed by the issue
of 200 000 ordinary shares at R1.25 each. An additional issue of ordinary shares was
made during the year at the same price to help finance the purchase of land and
buildings, which were purchased to expand the operations.
7. The carrying values of property, plant and equipment were:
2013 2012
R R
Land & buildings 3 000 000 1 800 000
Equipment 782 000 820 000
3 782 000 2 620 000
8. Land and buildings were revalued for the first time during the current financial year.
Equipment with a cost price of R80 000 and accumulated depreciation of R62 000 was
sold during the year and replaced with new equipment. Equipment with a book value of
R16 000 was scrapped during the financial year.

REQUIRED:
a. Prepare the statement of cash flow for All Aboard Ltd for the year ended 30 September
2013. Cash received from customers and cash paid to suppliers and employees must
be calculated separately and my not be calculated as balancing figures.

b. Prepare the note to reconcile the profit before tax with cash generated from operating
activities.

IGNORE VAT.