Prepare a statement of cash flows for the year ended 31 December 2008, as required by IAS 7 using the: (i) Direct method and (ii) Indirect method.

i) Direct Method (Below is the template)

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ii) Indirect Method (Below is the template)

Q1 The following are the income statement and balance sheet information of JC Limited: (i) A dividend of 250,000 was paid during the year. (ii) During the year 2008, non-current assets costing 2,000,000, with accumulated depreciation 400,000, were sold for 1,500,000. Required: Prepare a statement of cash flows for the year ended 31 December 2008, as required by IAS 7 using the: (i) Direct method and (ii) Indirect method.| Solution to Q1(i): Direct Method: Solution to Q1(ii): Indirect Method: JC Limited Statement of Cash Flows for the year ended 31 December 2008 Cash flows from operating activities 000 Profit before tax Depreciation Interest expense Loss on disposal of non-current assets Decrease in inventory Increase in accounts receivable Increase in accounts payable Cash generated from operations Interest paid Taxation paid Net cash flow from operating activities Cash flows from investing activities Payments to acquire non-current assets Receipt from sale of non-current assets Net cash flow from investing activities Cash flows from financing activities Dividends paid Net cash flow from financing activities Net increase in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year