QUESTION 1 Below are the statements of Financial Position for Grace Ltd as at 31 December, 2009 and 31 December, 2008 and the Statement of Profit or Loss and Other Comprehensive Income for the year ended 31 December, 2009. 2009 2008 ASSETS GHS'000 GHS'900 Non-current assets Tangible assets 832 681 Intangible assets 1.415 817 2,247 1,498 Current assets Inventory 619 701 Receivables 584 492 Investments 396 125 Cash 17 81 1,616 1.399 Total assets 3,863 2,897 *741 EQUITY AND LIABILITIES Equity Equity shares (GHS) Revaluation surplus Retained earnings 500 150 1.924 2.574 300 40 1494 1,834 Non-current liabilities Provision for court case 5% Debentures 73 220 293 50 88 138 30 Current liabilities Interest payable Bank Dividends payable Tax payable Trade payables TOO 60 81 238 517 996 3863 140 226 529 925 2.897 Total equiry and liabilities Statement of Profit or Loss and Other Comprehensive Income GHS'000 Revenue 1,761 Cost of sales and expenses (928) Operating profit 833 Interest charge (110) Profit before tax 723 Income tax expense (240) 483 Dividends (81) Profit for the year 4024 Retained earnings b/f 1210 Retained earnings e/ 1,612 pp. 512 Additional information: Intangible non-current assets represent deferred development expenditure. Amortisation in 2009 amounted to GHS43,000. Tangible non-current asset additions totaling GHS200,000 were made. Proceeds from the sale of tangible non-current assets were GHS103,000, on which Grace Lid suffered a loss of GHS6,000. Investments include treasury bills of GHS32.000 acquired during 2009. Grace Ltd secs these as cash equivalents. iv. During the year Grace Lid had a 1 for 4 bonus issue of shares, financed by capitalising part of the retained earnings account. In December 2009 there was a further issue at full market price. Required: Prepare a Statement of Cash Flows for Grace Ltd for the year ended 31 December, 2009 in accordance with IAS 7