Selected financial statement information and additional data for Johnston Enterprises is presented below.

Johnston Enterprises

Statement of Financial Position and Income Statement Data

December 31, December 31,

2019 2018

Property, Plant, and Equipment HK$1,241,000 HK$ 1,122,000

Less: Accumulated Depreciation (477,000) (442,000)

764,000 680,000

Current Assets:

Inventory 391,000 340,000

Accounts Receivable 238,000 306,000

Cash 154,000 119,000

Total Current Assets 783,000 765,000

Total Assets HK$1,547,000 HK$1,445,000

Equity:

Share CapitalOrdinary HK$ 510,000 HK$ 467,500

Retained Earnings 374,000 340,000

Total Equity 884,000 807,500

Non-Current Liabilities:

Bonds Payable 340,000 391,000

Current Liabilities:

Accounts Payable 187,000 102,000

Notes Payable 51,000 68,000

Income Taxes Payable 85,000 76,500

Total Current Liabilities 323,000 246,500

Total Liabilities 663,000 637,500

Total Liabilities & Equity HK$1,547,000 HK$1,445,000

Sales Revenue HK$1,615,000 HK$1,513,000

Less Cost of Goods Sold 731,000 731,000

Gross Profit 884,000 782,000

Expenses:

Depreciation Expense 154,000 136,000

Salaries and Wages Expense 391,000 357,000

Interest Expense 34,000 34,000

Loss on Sale of Equipment 17,000 0

Income Before Taxes 288,000 255,000

Less Income Tax Expense 119,000 102,000

Net Income HK$ 169,000 HK$ 153,000

Additional Information:

During the year, Johnston sold equipment with an original cost of HK$153,000 and accumulated depreciation of HK$119,000 and purchased new equipment for HK$272,000.

1. Calculate the dividend declared in 2019. Show your workings. (4 marks)
2. Prepare The Statement of cash flows for the year ending December 31, 2019. (9 marks)
3. A clerical staff asked you whether all the dividend declared in 2019 has been paid. Please advise to him. (3 marks)
4. A clerical staff asked you if a transaction for cash sales in 2019 has not been recorded, how would this affect your preparation of statement of cash flow? Please advise him. (4 marks)