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QUESTION 1 Below are the financial statements of Galamsey Gold Company Limited , a mining company that has been operating in the country for over
QUESTION 1
Below are the financial statements of Galamsey Gold Company Limited, a mining company that has been operating in the country for over a decade.
Statement of Financial Position as at 31st December. | ||
2017 | 2016 | |
Non-current assets | GH 000 | GH 000 |
Property, plant and equipment | 511,984 | 492,694 |
Deferred mine development expenditure | 293,704 | 279,373 |
Asset retirement costs | 29,644 | 21,367 |
Deferred tax asset | - | 4,691 |
Other non-current assets | 60,027 | 25,625 |
895,359 | 823,750 | |
Current assets | ||
Inventory | 71,753 | 48,411 |
Accounts receivable | 13,205 | 17,016 |
Amounts due from related companies | - | 827 |
Cash and bank | 38,032 | 40,466 |
122,990 | 106,720 | |
Current liabilities | ||
Third party debt | 8,824 | - |
Accounts payable | 51,882 | 55,315 |
Reclamation liability | 326 | 92 |
Amounts due to related companies | 23,331 | 111,008 |
Deferred tax liability | 1,985 | 1,015 |
86,348 | 167,430 | |
Net current assets/(liabilities) | 36,642 | (60,710) |
Non-current liabilities | ||
Third party debt | (66,176) | - |
Loans due to related companies | (511,382) | (509,113) |
Reclamation liability | (33,578) | (22,719) |
Deferred tax liability | (19,722) | |
Other non-current liabilities | (5,530) | (4,033) |
(636,388) | (535,865) | |
Net assets | 295,613 | 227,175 |
Financed by: | ||
Stated capital (@ GH 3.00 per share) | 158,406 | 158,406 |
Advance towards stated capital | 117,207 | 116,193 |
Income surplus account - surplus/(deficit) | 20,000 | (47,424) |
295,613 | 227,175 |
Income Statement for the year ended 31st December. | ||
2017 | 2016 | |
Turnover | 434,911 | 305,620 |
Cost of sales | (220,496) | (178,271) |
Gross profit | 214,415 | 127,349 |
General and administrative expenses | (135,208) | (112,051) |
Operating profit | 79,207 | 15,298 |
Other income | 14,614 | 4,361 |
Net profit before tax | 93,821 | 19,659 |
Income tax | (25,383) | (7,857) |
Profit after tax transferred to income surplus account | 68,438 | 11,802 |
Income Surplus Account | ||
Balance b/d | (47,424) | (59,226) |
Profit after tax transferred from profit and loss account | 68,438 | 11,802 |
21,014 | (47,424) | |
Dividend paid | 1,014 | 0 |
Surplus/(deficit) at 31 December | 20,000 | (47,424) |
The following additional information is also relevant:
- The market price per share is at GH 12.00
- For the line items within the Financial Statement of Galamsey Gold Company Limited in Question 1, as presented above, state for each, whether or not there was a resulting cash outflow or inflow from the year 2016 to 2017.
- Property, Plant and Equipment
- Stocks/Inventories
- Account Receivables
- Amounts due from related companies
- Cash and Bank
- Stated Capital
- Amounts due to related companies
- Deferred Tax Liability
- Deferred Tax Asset
- Loans due to related companies
- Third party debt
- Accounts Payable
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