QUESTION FOUR

PART A

The following are extracts from the financial records of ABC Ltd for the year ended 31 August 2021.

ABC Ltd

Extract from the Statement of financial statement as at 31 August 2021

ABC Ltd

Extract from the Statement of profit or loss and other comprehensive income for the year ended 31 August 2021

Additional information:

1. The dividends declared for the current year is R2 400.

Required:

Prepare only the Cash flows from operating activities section of the statement of cash flows for ABC Ltd for the year ended 31 August 2021. Use the indirect method.

Show all workings. Where applicable, round off calculations to the nearest Rand.

- Bank Inventories - trade goods Trade receivables Trade payables Prepaid expenses: Accrued expenses: interest Accrued expenses; other SARS - income tax payable Dividends payable 31 August 2021 R 50 000 22 000 77 000 44 000 1 800 1 000 5 700 8 000 1 500 31 August 2020 R 20 000 30 000 69 000 46 000 1 200 2400 4 400 3 000 2 700 R Sales Cost of sales Gross profit Profit on sale of Equipment Depreciation Interest expense Income tax expense Profit for the year 592 000 (301 000) 291 000 9 000 41 000 2600 15 200 110 300