A Level

1 Financial accounting

35 IAS 7 Statements of cash

flows
Additional questions
Question 1
The following information is given for Rabadia plc:

Rabadia plc
Statement of financial position at 30 November
2015 2014
$000 $000
ASSETS
Non-current assets 1 010 830
Current assets
Inventories 486 479
Trade receivables 318 337
Cash and cash equivalents 104 86
908 902
Total assets 1 918 1 732

EQUITY AND LIABILITIES

Equity
Ordinary share capital 800 800
Retained earnings 802 594
1 602 1 394

Current liabilities
Trade payables 230 246
Tax liabilities 86 92
316 338
Total equity and liabilities 1 918 1 732

Required
Prepare a table showing cash inflows and cash outflows for the year ended 30
November 2015.

Cambridge International AS and A Level Accounting Student’s CD © Ian Harrison 2015 1

35 IAS 7 Statements of cash flows

Question 2
The following information is given for McGarry and Wong plc at 31 March:

2015 2014
$000 $000
Current liabilities
Tax liability 112 130
Equity
Ordinary shares 1200 1000
General reserve 120 100
Retained earnings 1596 1372

During the year ended 31 March 2015:

● interest paid was $27 000

● dividends amounting to $80 000 were paid.

Required
a Calculate the profit from operations for the year ended 31 March 2015.
b Prepare a statement of changes in equity for the year ended 31 March 2015.

Question 3
The following information is given for Drogbha-Mikael and Co. plc:

31 May 2015 31 May 2014

$ $

Premises – at cost 250 000

at valuation 350 000

Less Depreciation (30 000) (20 000)

Carrying amount 320 000 230 000

There were no disposals of premises during the year.

Required
Calculate the entries to a statement of cash flows for the year ended 31 May 2015.

Question 4
The following information is available for Masood plc:

Masood plc
Statements of financial position (extract) at 31 August

2014 2013

$000 $000

Non-current assets at cost 2490 2160

Less Depreciation 910 830

1580 1330

During the year ended 31 August 2014 non-current assets costing $850 000, which had
been depreciated by $610 000, were sold for $170 000.
Required
Identify all entries that should be made in a statement of cash flows for the
year ended 31 August 2014, stating whether the entries will increase or decrease
cash flows.

2 Cambridge International AS and A Level Accounting Student’s CD © Ian Harrison 2015

 Additional questions

Question 5
The following information is given for Kalcot plc:

31 January 2015 31 January 2014

Plant – at cost ? 240 000

depreciation ? (100 000)

Carrying amount 96 200 140 000

During the year ended 31 January 2015 plant that had been purchased for $32 000
was sold for $13 200. The accumulated depreciation charged on the plant to the year
ended 31 January 2015 was $20 000. No plant was purchased during the year.
Required
Calculate all entries to a statement of cash flows for the year ended 31 January 2015.

Question 6
The following information is available for Gretul plc:

at 31 January 2015 at 31 January 2014

$000 $000

Cash and cash equivalents 280 420

7% debentures 1000 1500

Required
Prepare a reconciliation of net cash to movement in net debt for the year ended 31
January 2015.

Question 7
The following summarised statements of financial position are available for Shakoor plc:

31 March 2015 31 March 2014

$ $
ASSETS
Non-current assets 548 000 416 000
Less Depreciation (156 000) (118 000)
392 000 298 000
Current assets
Inventories 53 700 50 200
Trade receivables 29 800 31 780
Cash and cash equivalents 7 600 8 400
91 100 90 380
Total assets 483 100 388 380
EQUITY AND LIABILITIES
Equity
Issued ordinary share capital 300 000 200 000
Retained earnings 92 800 85 470
392 800 285 470
Current liabilities
Trade payables 52 300 62 910
Tax liability 38 000 40 000
90 300 102 910

Total equity and liabilities 483 100 388 380

Cambridge International AS and A Level Accounting Student’s CD © Ian Harrison 2015 3

35 IAS 7 Statements of cash flows

Required
Prepare a detailed analysis of the changes to the cash and cash equivalents during the
year ended 31 March 2015.

Question 8
The following are extracts from the statement of financial position of Dritoun plc:

31 January 2015 31 January 2014

$000 $000
Equity
Ordinary shares of $1 each 3000 2000
6% preference shares 800 600
Share premium account 630 1630
Retained earnings 1990 1920

During the year, a bonus issue of one ordinary share for every two held was made,
and 200 000 six per cent preference shares of $1 were issued at par.
Required
Identify the entries to be made in a statement of cash flows for the year ended
31 January 2015.

Question 9
The directors of Araby and Upperby Ltd provide the following information:

at 30 April 2015 at 30 April 2014

$000 $000
Cash and cash equivalents (117) 118
7% debenture stock 1300 2000
Long-term loan 750 400

Required
Prepare a reconciliation of net cash to movement in net debt for the year ended
30 April 2015.

Question 10
The following extracts from the income statements and statements of financial
position of Sagoo and Simpson Ltd are given:

Sagoo and Simpson Ltd

Income statement (extract) for the year ended 31 July 2015
$000
Profit before tax (Note 1) 133
Tax (40)
Profit for the year 93

Statement of changes in equity (extract) for the year ended

31 July 2015
$000
Retained earnings
Balance at 1 August 2014 135
Profit for the year 93
228
Dividends paid (45)
Balance at 31 July 2015 183

4 Cambridge International AS and A Level Accounting Student’s CD © Ian Harrison 2015

 Additional questions

Note 1
After adding interest received $12 000 and deducting interest paid $8 000

Sagoo and Simpson Ltd

Statement of financial position at 31 July
2015 2014
$000 $000 $000 $000
ASSETS
Non-current assets (Note 2)
Intangible assets 95 500
Tangible assets
Property at cost 612 540
Depreciation (300) 312 (280) 260
812 355

Current assets
Inventory 109 99
Trade receivables 79 67
Cash and cash equivalents 32 220 42 208
Total assets 1 032 563

EQUITY AND LIABILITIES

Equity
Ordinary share capital 650 250
Retained earnings 183 135
833 385

Non-current liabilities
5% debentures 80 70

Current liabilities
Trade payables 79 70
Tax 40 119 38 108
Total equity and liabilities 1 032 563

Note 2
There were no sales of non-current assets during the year.
Required
Prepare a statement of cash flows for the year ended 31 July 2015.

Cambridge International AS and A Level Accounting Student’s CD © Ian Harrison 2015 5