The final accounts of Dural Trade Ltd are provided below:
Dural Trade Ltd
Balance Sheet (Statement of financial position) as at:
| 2017
$ |
2018
$ |
|
| Assets | ||
| Bank | 71,760 | 92,400 |
| Accounts receivable | 115,200 | 131,760 |
| Inventory | 130,320 | 152,520 |
| Investments | 108,000 | – |
| Land | – | 122,400 |
| Equipment | 396,000 | 501,200 |
| Accumulated depreciation – equipment | (171,360) | (204,560) |
| TOTAL ASSETS | 649,920 | 795,720 |
| Liabilities and Shareholders’ Equity | ||
| Accounts payable | 73,200 | 82,680 |
| Operating expenses accrued | 6,000 | 7,320 |
| Dividend payable | 14,400 | 17,280 |
| Share capital (Ordinary shares @ $2 each) | 360,000 | 432,000 |
| Share premium | 17,280 | 31,680 |
| Retained earnings | 179,040 | 224,760 |
| TOTAL LIABILITIES AND EQUITY | 649,920 | 795,720 |
Dural Trade Ltd
Income statement for the year ended 31st December 2018
| $ | $ | |
| Sales | 1,432,800 | |
| Less: Cost of sales | 850,680 | |
| Gross profit | 582,120 | |
| Add: Gain on sale of investments | 9,600 | |
| 591,720 | ||
| Less: Operating expenses | ||
| Depreciation expenses | 43,200 | |
| Other expenses | 403,200 | 446,400 |
| Profit before tax | 145,320 | |
| Less: Tax expense | 34,800 | |
| Net profit after tax | 110,520 |
Additional information:
- Cash purchases of land and equipment were made during the year.
- An equipment was sold at its net book value for $25,400 for cash.
- The investments were sold for cash at $117,600.
- A rights issue at a premium price was made on the basis of 1 share for every 20 held. A bonus share, which was made out of retained earnings, was also given for every rights issue share. Cash has been received for the rights issue. (v) The directors declared a cash dividend during the year.
REQUIRED:
Prepare a Cash Flow Statement for Dural Trade Ltd for the year ended 31 December 2018 from the above information given (note that you should use the Direct Approach).
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