Question 2 The following are the financial statements, with an extract from the notes, of XYZ $ million 1,162 Sales Cost of sales (866) Gross profit Distribution costs Administrative expenses (110) Operating profit Interest received Interest paid Profit before taxation Taxation El 281 | 8|8a8xi lagi Profit for the financial year 2006 $m $m $m Non-current assets Intangible assets Tangible assets Investments 277 1.023 69 1.369 Current assets Inventory Trade receivables Investments Cash at bank and in hand 246 460 128 353 20 124 250 956 625 2.325 1,527 Equity Called up share capital Share premium Revaluation reserve Retained profits 24 377 29 447 251 165 48 892 449 755 555 2 4 Non-current liabilities Debenture stock Deferred taxation Current liabilities Overdrafts Trade payables Taxation 31 388 244 42 185 311 25 674 521 2,325 1,527 NOTES: (1) The noncurrent asset investments relate to the shares held by XYZ in a competitor company. (2) The intangible assets are patents used in production (3) The current asset investments were shares in S and F plc, held for a short-term gain. The sale of the current asset investments realized $25 million. The gain on the disposal has been subsumed into interest received (4) The trading profit is after charging depreciation on the tangible assets of $22 million and amortization on the intangible assets of $7 million. The revaluation reserve relates wholly to tangible assets. (5) During the year ended 31 March 2006, plant and machinery, costing $1,464 million, written down to $244 million at 31 March 2005, was sold for $250 million. The profit on disposal has been subsumed into cost of sales (6) A proportion of the debenture stock was issued at par for oil used in production, the remaining $130m was issued for cash (7) During the year ended 31 March 2006 25 million 20p shares were issued at a premium of $2.80 (8) During the year ended 31 March 2006 an equity dividend of $22 million was paid. a) Prepare a statement of cash flows of XYZ for the year ended 31 March 2006. Question 2 The following are the financial statements, with an extract from the notes, of XYZ $ million 1,162 Sales Cost of sales (866) Gross profit Distribution costs Administrative expenses (110) Operating profit Interest received Interest paid Profit before taxation Taxation El 281 | 8|8a8xi lagi Profit for the financial year 2006 $m $m $m Non-current assets Intangible assets Tangible assets Investments 277 1.023 69 1.369 Current assets Inventory Trade receivables Investments Cash at bank and in hand 246 460 128 353 20 124 250 956 625 2.325 1,527 Equity Called up share capital Share premium Revaluation reserve Retained profits 24 377 29 447 251 165 48 892 449 755 555 2 4 Non-current liabilities Debenture stock Deferred taxation Current liabilities Overdrafts Trade payables Taxation 31 388 244 42 185 311 25 674 521 2,325 1,527 NOTES: (1) The noncurrent asset investments relate to the shares held by XYZ in a competitor company. (2) The intangible assets are patents used in production (3) The current asset investments were shares in S and F plc, held for a short-term gain. The sale of the current asset investments realized $25 million. The gain on the disposal has been subsumed into interest received (4) The trading profit is after charging depreciation on the tangible assets of $22 million and amortization on the intangible assets of $7 million. The revaluation reserve relates wholly to tangible assets. (5) During the year ended 31 March 2006, plant and machinery, costing $1,464 million, written down to $244 million at 31 March 2005, was sold for $250 million. The profit on disposal has been subsumed into cost of sales (6) A proportion of the debenture stock was issued at par for oil used in production, the remaining $130m was issued for cash (7) During the year ended 31 March 2006 25 million 20p shares were issued at a premium of $2.80 (8) During the year ended 31 March 2006 an equity dividend of $22 million was paid. a) Prepare a statement of cash flows of XYZ for the year ended 31 March 2006