Required : prepare a statement of cash flows for the year ended 31 Dec 2016, using the indirect method to compute the cash flows from operating activities

Question 1 (32 marks) The following is the financial nformation of Aster Ltd: Statement of profit or loss for the year ended 31 December 2016 $000 Sales 33,500 Cost of goods sold 2,600 Gross profit 20,900 Less expenses Depreciation expense (3,430) Decrease in bad debts provision 120 Interest expense (400) Other operating expenses (12,290) Other gains and losses: Gain on sale of long term investments 50 Loss on sale of office equipment 200 Profit before tax 750 Tax expense 800 Profit after tax 3,950 Comparative Statements of Financial Position as at 31 December 2016 2015 S000 S000 Assets Property, plant and equipment 52,270 44,430 Long-term investment 5,800 7,000 14,200 Inventory 18,000 Accounts receivable 11,830 9,100 Other receivable 1,530 780 Cash at bank 3,800 89,430 Total Assets 79,310 Liabilities and owners' Equity Share capital 22,500 18,500 Retained profits 7,530 5.760 Debentures (long-term) 36,000 30,000 19,850 18.160 Accounts payable Other payable 1,750 650 Interest payable 520 560 Tax payable 2,380 1.980 Bank overdraft 2,600 Liabilities and owners' equity 9,43 9.3 The following information relates to 2016: 1 office equipment with a written down value of $1,200,000 was sold during the year for S1,000,000. Part of the long-term investments was sold for a gain of $50,000. 2 During the year, the company made a rights issue and raised $4,000,000 additional cash. 3 The company declared and paid cash dividends during the year