Ballamauda Ltd

During the year ending 31 December year 2 

a. A machine, which had originally cost £10,000, and on which £6,000 depreciation had been charged, was sold for £3,400.

b. The profit before tax, after deducting the loss on the sale of the machine, was £35,200.

c. Interest of £2,400, taxation of £6,400 and dividends of £6,000 were paid.

You are required to produce a cash flow statement for Ballamauda Ltd for the year ended 31 December year 2.

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Summarized statement of financial position as at 31 December Year 1 Year 2 Non-current assets 000 000 000 000 Machinery at cost 80 70 Provision for depreciation (40) 40 (44) 26 Current assets Inventories Receivables Cash 50 35 38 28 88 90 153 128 179 Total assets Current liabilities Trade payables 30 99 Overdraft 16 46 39 Non-current liabilities Debentures 40 Equity Share capital 40 Retained earnings 16 40 42 82 60 100 128 179