SECTION B You MUST answer BOTH questions in this section. This section is worth 70 marks. You are reminded to show all relevant workings in your answer booklet. Question 3 The financial statements for Conwy Ltd for year ended 30 September 2019 are provided below: Statements of Financial Position 2018 Notes 2019 f ASSETS Non-Current Assets Property, plant & equipment Investments 3,880 1.000 4.880 2,960 100 3.060 2,320 1.430 8 500 9.138 2,460 2.320 3 7843 Current Assets Inventory Trade receivables Accrued investment income Cash at Bank TOTAL ASSETS EQUITY AND LIABILITIES Equity Ordinary shares El cach Share premium Retained carnings Non-Current Liabilities S% Loan Notes 4% Loan Notes 3 3 1.500 670 830 3.000 1,300 520 100 1.920 1.850 500 2.000 2.500 1.850 Current Liabilities Bank overdraft Trade payables Taxation payable Accrued interest payable 3,633 620 400 2.490 510 23 TOTAL EQUITY AND LIABILITIES 4.288 9.138 3,423 7843 3 Statement of Profit & Loss 2019 2019 '000 '000 Tumover 17,195 Cost of sales (10.350) Gross Profit 6,845 Less expenses Administrative expenses (2,040) Distribution expenses (3.280) (5.320) Operating profit 1,525 Income from investments 30 Finance costs (105) Profit before taxation 1450 Taxation (540) Profit after taxation 910 Additional Notes: 1 The figure shown for property, plant & equipment as shown in the Statements of Financial Position consists of: 2019 2018 '000 '000 Property 1.056 800 Plant & equipment 2.824 2.160 3.880 2.960 There were no disposals of property or plant & equipment in the year. Property was acquired in the year at a cost of 300,000. The depreciation charged in the year on plant & equipment was 709.000. 2 Non-current asset investments are shown at cost. No investments were sold during the year 3 On 1 April 2019 Conwy Ltd issued 200,000 1 ordinary shares at a premium Dividends paid during the year were 180,000 4 Required: 1. Prepare a Statement of Cash Flows for the year ended 30 September 2019 using the indirect method. (40 marks) b. Discuss why the Statement of Cash Flows is more useful to stakeholders than the Statement of Profit or Loss. (10 marks) (Total marks for question 3: 50 marks)