Do all the general ledgers and prepare a Statment of Cash Flows using the Direct with a reconciliation of profit after tax from operating activities and a Statement of Cash Flows using the Indirect Method.
(ii) Direct Method SCF
Reconciliation of PAT from operating activities.
(iii) Indirect Method SCF
The following information has been extracted from the financial records of Bovine Ltd: 31/3/2019 $500 4 991 7 000 45 025 16 000 Cash Accounts receivable Inventory Plant and equipment - at cost Accumulated Depreciation Bank overdraft Accounts payable GST payable Interest expense payable Dividends payable Income tax payable Long-term borrowings Share capital Retained earnings 31/3/2018 $275 5 152 7 240 44 000 13 500 200 6 992 381 15 7 452 50 10 | 150 40 3 000 11 864 18 950 30 4000 9 799 21 750 Sales Cost of goods sold Operating expenses Interest expense Depreciation expense Loss on sale of P and E Tax expense Profit after tax 60 000 40 000 15 000 185 3 300 501 400 614 Additional information: 1. Bovine Ltd uses the direct method of reporting cash flows from operating activities. 2. The entity classifies dividends paid and interest paid as operating cash outflows. 3. There were no new long-term borrowings during the year. 4. An item of equipment was sold for $2 000 cash. 5. An item of equipment was purchased for $826 with an issue of shares. 6. The NZ GST rate is 15%. (ii) Bovine Ltd Statement of Cash Flows for the year ended 31 March 2019 Cash flows from operating activities: Cash generated from operations Net cash flow (used in)/from operating activities Cash flows from investing activities: Net cash flow (used in)/from investing activities Cash flows from financing activities Net cash flow (used in)/from financing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at beginning of period Bovine Ltd Reconciliation of profit after tax to net cash flow from operating activities Profit Transactions of a non-cash nature Deferrals/accruals of past or future operating cash receipts/payments Reverse items of income/expense included in profit but are CFIA/CFFA Other Net cash flow (used in) from operating activities (iii) Bovine Ltd Statement of Cash Flows for the year ended 31 March 2019 Cash flows from operating activities: Transactions of a non-cash nature Deferrals/accruals of past or future operating cash receipts/payments Reverse items of income/expense included in profit but are CFIA/CFFA Reverse items of income/expense included in profit to be shown separately as CFOA Cash generated from operations Net cash flow (used in)/from operating activities Cash flows from investing activities: Net cash flow (used in)/from investing activities Cash flows from financing activities Net cash flow (used in)/from financing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period
