Question 2: On 31 December 2001, the issued share capital consisted of 100,000 ordinary shares of Rs 10 each, and the shares were quoted at Rs 40. On 1 July 2002 the company made a right issue in the proportion of 1 for 4 at Rs 20 per share. Its profit after tax for the last two years were as follows: Rs 320,000 for 2001 and Rs 425,000 for 2002. Required: (Marks 08) Calculate basic EPS and comparative figure for 2001. Question 3: The following financial statements relate to Red Flag for the year ended 31 May 2007: Statement of financial position as at 30 September.

2003 2002 Rupees in 000

Non-Current Assets Property plant & equipment 634 634 510 510

Current Assets Inventory Receivable Interest receivable Investment Cash at bank Cash in hand

420 390 4 50 75 7 946 460 320 9 0 0 5 794 Total Assets 1580 1304

Capital and reserve Ordinary shares Rs 0.50 each Share premium Revaluation Reserve Retained Earnings

363 89 50 63 565 300 92 0 (70) 322

Non-Current liabilities 10% loan notes 5% loan notes

0 329 329 40 349 389

Current liabilities Bank overdraft Trade payables Income tax Accruals

0 550 100 36 686 70 400 90 33 593 Total equity and liabilities 1580 1304 Income statement for the year ended 30 September 2003.

2003 Rupees in 000

Revenue/Sales Cost of sales Gross profit Distribution expenses Admin expenses Operating profit Finance costs Investment income Profit before tax Income tax Profit for the year

2900 (1734) 1166 (520) (342) 304 (19) 5 290 (104) 186

Other comprehensive income for the year ended 30 September 2003.

Rupees in 000

Profit for the year Other comprehensive income Gain on property revaluation Total comprehensive income for the year

186 86 236

Additional Information: 1. On 1 October 2002, Red Flag Ltd issued 60,000 Rs 0.50 ordinary shares at a premium of 100%. The proceeds were used to finance the purchase and cancellation of all its 10% loan notes and some of its 5% loan notes, both at par. A bonus issue for 1 for 10 shares held was made on 1 November 2002; all shares in issue qualified for the bonus. 2. Non-current assets include certain properties which were revalued in the year 3. Non-current assets disposed of in the year had a carrying value of Rs 75,000; Cash received on disposal was Rs 98,000. Gain on sale is already included in the profit for the year. 4. Depreciation charged for the year was Rs 87,000. 5. The accruals balance includes interest payable of Rs 33,000 at 30 September 2002 and Rs 6,000 at 30 September 2003. 6. Dividend paid during the year were Rs 53,000. Required: (Marks 20) Prepare cash flow statement in accordance with IAS 7.

Question 21 On 31 December 2001, the issued share capital consisted of 100,000 ordinary shares of Rs 10 each, and the shares were quoted at Rs 40. On 1 May 2002 the company made a right issue in the proportion of 1 for 4 at Rs 20 per shave. Its profit after tax for the last two years were as folows: Rs 320,000 for 2001 and Rs 425,000 for 2002. Required: (Marks 08) Calculate basic EPS and comparative figure for 2001. Question 3: The following financial statements relate to Red Rag for the year ended 31 May 2007 Statement of financial position as at 30 september. 2003 2002 Rupees in 9000 Non-Current Assets Property plant & equipment 510 634 510 Current Assets Inventory 420 460 Receivable 390 320 Interest receivable 4 9 Investment 50 0 Cash at bank 25 0 Cash in hand 7 5 946 794 Total Assets 1580 1304 634 Capital and reserve Ordinary shares Rs 0.50 each 363 300 Share premium 89 92 Revaluation Reserve 50 0 Retained Earnings 63 (70) 565 322 Non-Current liabilities 10% loan notes 0 40 5% loan notes 329 349 329 389 Current liabilities Bank overdraft 0 70 Trade payables 550 400 Income to 100 90 Accruals 36 33 686 593 Total equity and liabilities 1580 1304 Income statement for the year anded 30 September 2003 2003 Rupees in "000" Reverse Sales 2900 Cost of sales Gross profit 1166 Distribution expenses (520) Admin expenses (142) Operating profit 304 Finance costs (19) Investment income 5 Profit before tax 290 Income tax (104) Profit for the year 186 Other comprehensive Income for the year ended 30 september 2003 Rupees in '000 Profit for the year 186 Other comprehensive income Gain on property revaluation 86 Total comprehensive income for the year 236 Additional Information 1. On 1 October 2002, Red Flag Ltd issued 60,000 Rs 0.50 ordinwy shares at a premium of 100%. The proceeds were used to finance the purchase and cancellation of all its 10% ban notes and some of Rs 5% loan notes, both at par. A bonus issue for 1 for 10 shares held was made on 1 November 2002, al shares in issue qualified for the bonus 2. Non-current assets include certain properties which were revalued in the year 3. Non-current assets disposed of in the you had a carrying value of Rs 75,000; Cash received on disposal was Rs 98,000. Gain on sale is already included in the profit for the year 4. Depreciation charged for the year was Rs 87,000. 5. The accruals balance includes interest payable of Rs 33,000 at 30 September 2002 and Rs 6,000 at 30 September 2003 6. Dividend paid during the year were Rs 53,000 Required: (Marks 20) Prepare cash flow statement Page 2