Question: Galito Limited

You are provided with information relating to Galito Limited. The financial year-end is
on 31 October 2020.

INFORMATION:
A. The following information was extracted from the Statement of profit or loss and
other comprehensive income:
Finance cost 175 500
Interest received 80 000
Net profit before tax 1 350 000
Net profit after tax 975 000

B. Information extracted from the Statement of financial position:

31/10/2020 31/10/2019
Ordinary share capital 3 450 000 3 150 000
8% redeemable preference share capital 300 000 350 000
Retained income 1 000 000 850 000
Revaluation reserve 200 000 -
Land and Buildings 2 500 000 2 800 000
Vehicles 1 360 000 1 110 000
Accumulated depreciation on vehicles 412 000 292 500
SARS: Income tax 22 500 (dr) 27 500 (cr)
Loan: Algar Bank 1 375 000 2 000 000
Shareholders for dividends 450 000 685 000
Bank 25 000 (dr) 43 000 (cr)

C. Additional information:
1. A vehicle was sold at a profit of R25 000 on the last day of the financial year.
The vehicle was bought for R400 000 on 1 August 2018. Depreciation is
written off on vehicles at 20% per year on the diminishing balance.
2. Land and buildings were sold at cost during the financial year. The remaining
land and buildings were revalued during the year.
3. The dividends (interim and final) declared for the financial year ended
31 October 2020 amounted to R825 000.
4. Cash received from clients, R4 510 300.
5. Cash paid to suppliers and employees, R2 605 000.

You are required to:

1. Prepare the cash flow statement of Galito limited for the financial year ended 31
October 2020.
2. Show all calculations and the relevant accounts in the General ledger.