Holly Bolly Bhd Statements of Financial Position as at 31 December Non-current assets Property, plant and equipment Software x6 RM'000 x5 RM'000 2,560 1,880 270 Nil Current assets Inventories 960 1,020 Investments (fair value through profit or loss) 300 250 Trade receivables 700 870 Bank Nil 4,790 4,090 Ordinary share capital of 25 sen each 1,000 600 Reserves Share premium 300 Revaluation reserve 120 Retained earnings 1,900 g 170 1,930 Non-current liabilities 9% Debentures 240 Provision for restoration of environment 324 Deferred tax 36 50 Current liabilities Trade payables Tax payable Bank overdraft 700 1,110 120 100 50 80 4,790 4,090 Holly Bolly Bhd Statement of Comprehensive Income for the Year Ended 31 December x6 Revenue Cost of sales Gross profit RM'000 2,794 (2,220) 574 Operating expenses (250) 324 Investment income and gain on investment 40 Finance costs (80) Profit before tax 284 Taxation (114) Profit after tax 170 Additional information The following supporting information is available: (a) On 1 July x6, there was a bonus issue of equity shares of one for every four held. The share premium was utilised for the bonus issue. A rights issue was made on 1 September x6. There was no share buy-back during the year. (b) Included in property, plant and equipment is a tin mine and related plant that Holly Bolly purchased on 1 January x6. The estimated life of the mine is ten years and at the end of operations legislation requires the company to landscape the area affected by the mining. The future cost was discounted at 8% to present value of RM300,000. The cost is included in the carrying value of the mine, and together with the unwinding of the interest, has been treated as provision. The finance cost in the income statement includes the unwinding of the discount. (c) Land was revalued upwards by RM70,000 during the year. (d) There was no disposal of property, plant and equipment during the year. Depreciation charged was RM510,000. (e) Software was purchased during the year for RM360,000. (f) The market value of the investments had increased during the year by RM30,000. There was no sale of investment. (g) Dividend was paid during the year. Required: Prepare the statement of cash flows. 3 Given below are the lists of balances of the statements of financial position of G.R. Bhd. 31.12.x6 31.12.x5 RM'000 RM'000 Ordinary share capital 10,000 7,000 Preference shares 2,000 3,000 Reserves 8,000 6,000 10% Loan (foreign loan) 4,000 5,000 Provisions for warranties 800 300 Deferred tax liabilities 3,000 2,500 Retirement benefits 1,200 900 29,000 24,700 Property, plant and equipment - cost 24,800 24,200 Accumulated depreciation (4,000) (4,500) Computer software 500 Research and development 1,500 700 700 Long-term investments 4,000 3,000 Short-term investment Inventories Receivables Bank Tax recoverable Nil 1,000 2,100 1,300 3,500 1,900 100 1,100 Nil 200 Tax payable (800) Payables (1,800) (1,500) Bank overdraft (900) (3,400) 29,000 24,700 G.R. Bhd Statement of Comprehensive Income for the Year Ended 31 December x6 RM'000 Sales 15,000 Cost of sales (7,000) 8,000 Expenses (4,200) Foreign currency transaction - gain 600 Interest expense (400) Dividend income 1,000 Gain on disposal of short-term investments 200 5,200 Tax charge (3,000) 2,200 Dividend paid (1,700) 500 Reserves 31.12.x6 31.12.x5 RM'000 RM'000 Share premium 3,000 2,000 Capital redemption reserve 1,000 Revaluation reserve 2,000 1,500 Retained profits 2,000 2,500 Additional information (a) Preference shares were redeemed and the premium on redemption of 10% was written off against the share premium. No new shares were issued in order to facilitate the redemption of preference shares. (b) A fully depreciated plant costing RM1.7 million was disposed of at a gain of RM500,000. (c) A piece of land was revalued and the surplus on revaluation was RM500,000. (d) The long-term loan is a foreign loan and there was a gain on retranslating the loan into ringgit at year-end. (e) No long-term investments were sold off during the year x6. (f) The short-term investments do not qualify as cash equivalents. During the year, short-term investments costing RM1 million were sold for RM1.2 million. (g) Research and development costs capitalised during the year were RM1.3. Development costs were amortised and charged as operating expenses. Required: Prepare the statement of cash flows and all relevant notes