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Question 3 (36 Marks) Here are the financial statements of Diamonds Ltd on 30 September 2018. Diamond Ltd Abridged statement of profit or loss and other comprehensive income for the year ended 30 September 2018 N$ Gross profit 2,400,000.00 Other operating expenses (1,580,000.00) Operating profit 820,000.00 Operating income Profit on sale of equipment 12,000.00 Profit from operations 832,000.00 Financing activities Investment income - dividends 68,000.00 Interest on mortgage bond (164,000.00) Profit before tax 736,000.00 Income tax (187,040.00) Profit for the year 548,960.00 Other comprehensive income Re-valuation of land buildings 850,000.00 Total comprehensive income 1,398,960.00 Diamond Ltd Statement of financial position as at 30 September 2018 N$ 2018 N$ 2017 ASSETS Non-current assets PPE Investments at costs 4,416,400.00 3,782,000.00 634,400.00 2,940,000.00 2,620,000.00 320,000.00 Current assets Inventory Trade receivables Cash and cash equivalents TOTAL ASSETS 2,685,000.00 825,000.00 70,560.00 7,996,960.00 2,750,000.00 675,000.00 29,000.00 6,394,000.00 EQUTY AND LIABILITIES Equity & reserves Share capital Reserves Retained earnings 5,060,960.00 2,500,000.00 995,000.00 1,565,960.00 3,972,000.00 2,275,000.00 200.000.00 1,497,000.00 Non-current liabilities Mortgage bond 1,750,000.00 1,750,000.00 1,200,000.00 1,200,000.00 Current liabilities Trade payables Inland revenue - Income Tax Shareholders for dividends Inland Revenue - dividends withholding tax TOTAL EQUITY AND LIABILITIES 645,000.00 61,000.00 408,000.00 72,000.00 7,996,960.00 720,000.00 92,000.00 348,500.00 61,500.00 6,394,000.00 Additional information: 1. The company maintains a gross profit percentage of 40 % on sales. 2. Other operating expenses include: Depreciation on equipment N$ 164 000 and Loss on scrapping of equipment - NS 16 000 3. The authorized share capital consist of: Page 25 of 27 SIKO00 no por value ordine stores 2 500 000 86 redeemable preference shares with a par value of NS 2.25 4. Issued share capital consists of: 25 NS 2017 NS LISUDO LII.00 Standaal 1.600.00 3. Radnable preference shares 20.00 2.5 MODO The original issue of cedinary stures was at NS LIS 5. Reserves consist of the following: 2.27500.00 2015 NS 2017 NS 145.000.00 20000000 Reval Ve un 595.000.00 2012 6. liile compty policy declare divide the call of the financial year with the payment being made during the most of her in the wing fancial your 7. Immediately after the dividends were declared the company redeemed 100 000 redeemable preference shares at NS 21h. This was partially financed by the issue of 2009 ordinary shares NS 1.25 eacht. An diese edinary shares NS 1.25 cach. An additionalist of try stics was made during the same price taip fimme the purchase of land and Building, which were puncted expand the per & The carrying values of PPE were: 2018 2017 NS NS 1.800.000,00 Land & Building 3.00 Pap 26 27 Equipment 782,000.00 3,782,000.00 820,000.00 2,620,000.00 9. Land and buildings were revalued for the first time during the current financial year. Equipment with the cost price of N$ 80 000 and accumulated depreciation of N$ 62 000 was sold during the year and replaced with new equipment. Equipment with a book value of N$ 16 000 was scrapped during the financial year. You are required to: 1. Prepare a statement of Cash Flow for Diamond Ltd for the year ended 30 September 2018 to conform to the requirement of IAS 7 using direct method. Show all your workings. (25 marks) 2. Prepare the note reconcile the profit before tax to cash generated from operating activities. (11 marks) END OF ASSIGNMENT 2 Question 3 (36 Marks) Here are the financial statements of Diamonds Ltd on 30 September 2018. Diamond Ltd Abridged statement of profit or loss and other comprehensive income for the year ended 30 September 2018 N$ Gross profit 2,400,000.00 Other operating expenses (1,580,000.00) Operating profit 820,000.00 Operating income Profit on sale of equipment 12,000.00 Profit from operations 832,000.00 Financing activities Investment income - dividends 68,000.00 Interest on mortgage bond (164,000.00) Profit before tax 736,000.00 Income tax (187,040.00) Profit for the year 548,960.00 Other comprehensive income Re-valuation of land buildings 850,000.00 Total comprehensive income 1,398,960.00 Diamond Ltd Statement of financial position as at 30 September 2018 N$ 2018 N$ 2017 ASSETS Non-current assets PPE Investments at costs 4,416,400.00 3,782,000.00 634,400.00 2,940,000.00 2,620,000.00 320,000.00 Current assets Inventory Trade receivables Cash and cash equivalents TOTAL ASSETS 2,685,000.00 825,000.00 70,560.00 7,996,960.00 2,750,000.00 675,000.00 29,000.00 6,394,000.00 EQUTY AND LIABILITIES Equity & reserves Share capital Reserves Retained earnings 5,060,960.00 2,500,000.00 995,000.00 1,565,960.00 3,972,000.00 2,275,000.00 200.000.00 1,497,000.00 Non-current liabilities Mortgage bond 1,750,000.00 1,750,000.00 1,200,000.00 1,200,000.00 Current liabilities Trade payables Inland revenue - Income Tax Shareholders for dividends Inland Revenue - dividends withholding tax TOTAL EQUITY AND LIABILITIES 645,000.00 61,000.00 408,000.00 72,000.00 7,996,960.00 720,000.00 92,000.00 348,500.00 61,500.00 6,394,000.00 Additional information: 1. The company maintains a gross profit percentage of 40 % on sales. 2. Other operating expenses include: Depreciation on equipment N$ 164 000 and Loss on scrapping of equipment - NS 16 000 3. The authorized share capital consist of: Page 25 of 27 SIKO00 no por value ordine stores 2 500 000 86 redeemable preference shares with a par value of NS 2.25 4. Issued share capital consists of: 25 NS 2017 NS LISUDO LII.00 Standaal 1.600.00 3. Radnable preference shares 20.00 2.5 MODO The original issue of cedinary stures was at NS LIS 5. Reserves consist of the following: 2.27500.00 2015 NS 2017 NS 145.000.00 20000000 Reval Ve un 595.000.00 2012 6. liile compty policy declare divide the call of the financial year with the payment being made during the most of her in the wing fancial your 7. Immediately after the dividends were declared the company redeemed 100 000 redeemable preference shares at NS 21h. This was partially financed by the issue of 2009 ordinary shares NS 1.25 eacht. An diese edinary shares NS 1.25 cach. An additionalist of try stics was made during the same price taip fimme the purchase of land and Building, which were puncted expand the per & The carrying values of PPE were: 2018 2017 NS NS 1.800.000,00 Land & Building 3.00 Pap 26 27 Equipment 782,000.00 3,782,000.00 820,000.00 2,620,000.00 9. Land and buildings were revalued for the first time during the current financial year. Equipment with the cost price of N$ 80 000 and accumulated depreciation of N$ 62 000 was sold during the year and replaced with new equipment. Equipment with a book value of N$ 16 000 was scrapped during the financial year. You are required to: 1. Prepare a statement of Cash Flow for Diamond Ltd for the year ended 30 September 2018 to conform to the requirement of IAS 7 using direct method. Show all your workings. (25 marks) 2. Prepare the note reconcile the profit before tax to cash generated from operating activities. (11 marks) END OF ASSIGNMENT 2