Additional notes :

1. The company received cash proceeds of R57 000 from the disposal equipment that had a cost of R60 000.

2. Dividends of R100 000 were paid out during the year.

Required: 

1 Prepare the company’s Statement of Cash flows for the year ended 31 December 2022. Employ the direct method of computing cash flows from operating activities.

2 Discuss the most notable differences between direct and indirect cash flow reporting.

3 List any two (3) adjustments for non-operating expenses that accountants normally make to determine cash flows in operating activities.

Mogwera Company (Pty) Ltd's 2022 annual financial statements follow: Statement of Financial Position 2022 ASSETS Current assets Cash Accounts Receivable Inventory Equipment Total Assets EQUITY & LIABILITIES Current liabilities Accounts payable L/T Notes payable Total liabilities Equity Retained Income Total Liabilities & Equity 2021 R R 82 000 180 000 170 000 128 000 560 000 100 000 100 000 250 000 250 000 160 000 560 000 40 000 150 000 200 000 80 000 470 000 80 000 50 000 130 000 250 000 90 000 470 000