Equity PLC

Equity PLC has the following balance sheets and income statement for the year ending 31st October 2013

Balance Sheets as at 31st October:
2013 2012
£ ‘000 £ ‘000 £ ‘000 £ ‘000 £ ‘000 £ ‘000
Cost Depn NBV Cost Depn NBV
Non current asssets
Land & Buildings 58,000 12,000 46,000 40,000 10,000 30,000
Plant & Machinery 32,500 14,500 18,000 30,000 12,000 18,000
90,500 26,500 64,000 70,000 22,000 48,000
Current Assets:
Inventories 25,000 30,000
Accounts receivable 35,000 28,000
Current Asset Investment 5,000 0
Bank 0 12,000
65,000 70,000
Total Assets 129,000 118,000
Capital:
Ordinary Share Capital 35,000 30,000
Share Premium Account 10,000 8,000
Revaluation Account 2,000 0
Retained Profits 23,000 20,000
70,000 58,000
Non Current Liabilities
Loans 20,000 15,000
20,000 15,000
Current Liabilities
Accounts payable 27,000 32,000
Proposed Dividends 6,600 11,000
Finance and Accounting for Managers 5
Bank overdraft 3,000 0
Taxation 2,400 2,000
39,000 45,000
Total Equity and Liabilities 129,000 118,000
Equity Plc
Income Statement for the year ending 31st October 2013:
£ ‘000
Sales 98,000
Cost of Sales -48,000
Gross Profit 50,000
Other operating expenses -35,000
Profit before interest 15,000
Interest -1,200
Profit before taxation 13,800
Taxation -2,800
Profit after taxation 11,000

The following additional information is available:

  1. Equity PLC recorded an increase in the value of its land of £2,000,000 during the year.
  1. The company has proposed dividends of £8,000 for the year.
  1. During the year, an item of machinery that originally cost £3,000,000 was sold for £500,000 – making a loss of £1,000,000. This item is included in the operating expenses.

My goal

  1. Prepare a Cash Flow Statement for the year ended 31st October 2013 in accordance with IAS 7 (revised), using the indirect method.

 

  1. Prepare a Business Report commenting on the cash position of Equity PLC.

My Assessment

  1. Reporting entity

Equity Plc (the ‘Company‘) is domiciled in United Kingdom. The Company is primarily involved in manufacturing xxx.

  1. Basis of accounting

The Consolidated statement of cash flows has been prepared in accordance with IFRS. They were authorised for issue on 21 June 2017.

  1. Functional and presentation currency

The Consolidated statement of cash flows is presented in GBP, which is the Company’s functional currency. All amounts have been rounded to the nearest thousand, unless otherwise indicated.

  1. Notes on operating cash flows
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