Question 2 Lulu Bhd is a public company in Jerantut, Pahang. The statement of financial position as at 31 December 2018 and 2019 are as follows: Additional information for the financial year ended 31 December 2019: 1. Details of the following expenses comprises RM Distribution Advertising expenses 30,000 Other expenses 37,500 Lulu Berhad Statement of Financial Position as at 31 December 2018 and 2019 Administration NON-CURRENT ASSET 2018 (Notes1 ) Property, plant, and equipment Investment 132.000 52,000 2019 197,000 48,000 Wages and salaries Depreciation - Land and building Plant and machinery Director's remuneration Loss on disposal of plant & Machinery 35,800 2,500 14.000 10.000 1,000 33.600 CURRENT ASSET Inventories Trade receivables Cash in hand 30.800 36,200 600 251,600 24,800 5,000 308,400 Finance Cost Debenture interest Bank interest 1,600 4,000 (Notes 2) EQUITY AND LIABILITIES Share capital General reserve Retained profit 100,000 30,000 1.200 145,000 43.000 1,400 NON CURRENT LIABILITIES Debentures 2. During the year, plant and machinery costing RM20,000 (accumulated depreciation RM18,000) was disposed. 3. Last year's dividend was paid this year and interim dividend paid for the current year was RM8,500 4. Taxation expense for the current year was RM12,000 5. Ordinary shares and preference shares were issued during the current year 6. Investment was sold at cost and income received from investment amounted to RM2,600 20,000 16,000 CURRENT LIABILITIES Bank overdraft Account payable Taxation Dividend payable Notes 1 Non-current asset 48,000 24,000 22.400 6,000 251,600 42.000 27,600 23,400 10,000 308,400 2018 2019 Land and building Land and building Less : Accumulated depreciation 90.000 (10,000) 80,000 104,000 (52,000) 52.000 149.500 (12,500) 137.000 108,000 (48,000) Plant and machinery Less: Accumulated depreciation 60,000 1 132,000 197,000 Notes 2 Issued and paid up capital 2018 2019 Ordinary shares 5% preference shares 60,000 40,000 100,000 101,000 44,000 145,000 Required: (a) Prepare a statement of cash flow for Lulu Berhad for the year ended 30 December 2019 using the indirect method. (30 marks) (b) List two (2) situations where a company may increase its number of shares without increasing new funds. (10 marks) Note: Show all relevant workings [40 marks