The following are extracts from the financial statements of Wewe Ltd. As at 31 March:

2018

2017

Sh.'000'

Sh.'000'

Sh.'000'

Sh.'000'

J

10,050

6,140

1,710

200

18,100

(2,390)

(5,850)

(450)

(820)

(9,510)

2,800

16,800

5,860

3,600

29,060

8,590

37,650

(7,500)

30,150

18,000

1,500

4,500

6,150

8,700

7,800

840

430

17,770

(6,540)

(5,250)

(380)

(600)

(12,770)

2,900

12,000

6,350

3,750

25,000

5,000

30,000

(9,000)

21,000

15,000

750

-

5,250

30,150

21,000

The profit and loss appropriation account for the year ended 31 March 2018 is given below:

Sh.'000'

Sh.'000'

Net profit before tax

Less: Corporation tax

Profit after tax

Dividends:

Interim (paid)

Proposed (paid)

150

450

2,400

900

1,500

600

900

The following additional information is provided:

1.Profit for the year is arrived at after charging:

Sh.'000'

Depreciation on plant and machinery

Goodwill amortisation

1,150

420

2.During the year, plant with a net book value of Sh.750,000 was sold forSh.1,470,000.The plant had originally cost Sh.3,000,000.

3.The investments portfolio was reduced by selling one block of shares at a profit

of sh.160,000.

Required:

Cash flow statement in accordance with IAS 7.(18 marks)

QUESTION TWO

Masaba Company Ltd. is a retail provider with an authorised share capital of

800,000 Sh.20 ordinary shares and 250,000 8% Sh.20 redeemable preference shares.

The following financial information reflects the position of the company as at 31 December 2018 after preparing the Trading, profit and loss account:

Sh.

`000'

Provision for depreciationFittings

1,500^,

Motor vehicles

3,740

Goodwill

1,200

Issued share capital: 600,000 Sh.20 Ordinary shares

12,000

250,000 Sh.20 Redeemable preference shares

5,000

Share premium account

400

Trade debtors and prepayments

1,708

Land and buildings at valuation (Cost Sh.4, 400,000)

18,400

Capital redemption reserve fund

3,000

Fittings at cost

3,000

Motor vehicles at cost

7,940

10`% Debentures

1,600

Trade creditors and accruals

960

Short-term investments (Market value Sh.860,000)

7 8 0

Stock at 31 December 2018

2,960

Bank overdraft

540

Revaluation reserve

1,000

Net profit for the year

1,440

Retained profit at 1 January 2018

4,460

General Reserve

1,100

Provision for doubtful debts

48

Interim dividend paid - Ordinary

600

- Preference

200

The following resolutions relating to year ended 31 December 2018 have been passed by the board of directors of the company

1.Transfer Sh.500,000 to General Reserve.

2.Provide for 5% final dividend and final preference dividend on shares issued and

outstanding on 31 December 2018.

3.Make a bonus issue of 100,000 fully paid ordinary shares from the retained profits

account.

Required:

(i)The appropriations account of Masaba Company Ltd. for the year ended 31 December 2018. (4 marks)

(ii)Statement of financial position of Masaba Company Ltd. as at 31 December 2018.(8 marks)