SCENARIO $2$

The following information is taken from the financial statements of Lumitech Solutions Ltd$,$ a specialist retailer for household electrics. You will find extracts from their accounts for the years ended $31$ December $2022$ and $31$ December $2023$ and supporting information.

Use this information to answer questions $8,9,10,$ and $11.$

$\backslash$table$[[,\backslash$table$[[000$s$],[$As at $31$ December$],[2023]],\backslash$table$[[000$s$],[$As at $31$ December$],[2022]]],[\backslash$table$[[$Property$,$ plant, and equipment $($at$],[$cost$)]],8,280,7,560],[$Inventory$,5,100,2,400],[$Trade receivables,$2,700,1,920],[$Trade payables,$2,400,3,240],[$Debentures$,3,000,0],[$Retained earnings,$4,884,3,024]]$

Lumitech Solutions Ltd generated a net profit of $2,020,000$ for the year ended $31$ December $2023.$

Lumitech Solutions Ltd sold equipment with a historical cost of $640,000$ and accumulated depreciation of $420,000,$ collecting $300,000$ in sales proceeds.

Q$8$

When preparing the cash flow statement, select which adjustment is required to net profit, using the indirect method, to eliminate the non$-$cash effect of the equipment disposa$)($select one$)?$

a$)640,000$

b$)420,000$

c$)220,000$

d$)80,000$

e$)(80,000)$

f$)(220,000)$

g$)(420,000)$

h$)(640,000)$

PTO

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