Calculate Dellars net cash flow from operating activities

Assignment Help Financial Accounting

Reference no: EM131961544

Financial Accounting Assignment -

There are 3 questions in this assignment.

QUESTION 1 - Amy and Billy are in partnership sharing profits and losses in the ratio of 3:2 respectively. The following Trial Balance was extracted from the books at 31 December 2015 after the completion of the Income Statement:

	$000	$000
Capital Accounts - 1January 2015:
Amy		300
Billy		100
Cash at Bank	5
Trade Receivables	241
Trade Payables		166
Drawings:
Amy (all at 30 Jun 2015)	40
Billy (All at 31 Mar 2015)	40
Non-Current Assets
Cost	320
Depreciation (to 31 December 2015)		100
Billy- Salary	10
Net Profit (for the year ended 31 December 2015)		60
Inventory	70
	726	726

Additional information:

1) The partnership agreement allows Billy to receive a salary of $20 000 per annum and for interest of 5% per annum to be received on the partners' Capital Account balances as at 1 January in each year. Interest at a rate of 10% per annum is charged on the partners' drawings.

2) The partners decided to sell the business to GreenCorp Ltd on 31 December 2015. The purchase consideration was 400 000 $1 Ordinary shares in Norman at a premium of $0.25 per share. The shares were issued to the partners on 31 December 2015 and shared between them in their profit- sharing ratio.

3) The sale agreement allowed Amy to take over one of the business cars at an agreed valuation of $10 000. Apart from the car and bank balance, the company took over all the other partnership assets and liabilities at their book values at 31 December 2015.

Required: Write up the following accounts of the partnership showing its dissolution at 31 December 2015:

a) The Realisation Account.

b) The Capital Accounts of Amy and Billy, in columnar form, showing the entries required to reflect both the year-end appropriations of net profit and the dissolution of the partnership.

c) The Bank Account.

QUESTION 2 - The following information relates to the transactions of Dellars Ltd for the year ended 30 September 2016:

	$000
Cash paid for expenses	2330
Cash paid to employees	3000
Increases in inventories	350
Decrease in trade receivables	400
Purchases	4730
Decrease in trade payables	600
Sales	12800
Operating Profit	2580
Depreciation of tangible non-current assets	460
Loss on sales of tangible non-current assets	50

Required: Calculate Dellars Ltd's net cash flow from operating activities for the company's Cash Flow Statement for the year ended 30 Sept 2016 using

(i) The direct method

(ii) The indirect method

QUESTION 3 - Mobile plc acquired 80% of the equity shares of Star Ltd on 1 January 2015. The following is an extract from the Statements of Financial Position of the two companies at 31 Mar 2016.

Current Assets	Mobile Plc	Star Ltd
Inventory	100000	60000
Trade Receivable	75000	15000
Dividend Receivable	4800
Current Liabilities
Trade Payable	38000	37000
Dividend Payable	12000	6000

Additional information:

(1) The trade receivable of Mobile plc include $10000 owed by Star Ltd. Included in Star Ltd's trade payable is an amount of $10000 owed to Mobile plc.

(2) The dividend receivable are receivable from Star Ltd.

Required: Show the amounts that will be reported in the Consolidated Statement of Financial Position in respect of the following item:

(a) Inventory

(b) Trade Receivable

(d) Trade Payable

(e) Dividend Payable

Reference no: EM131961544

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len1961544

4/28/2018 5:21:50 AM

There are 3 Questions related to this assignment. This Assignment based on UK. Answer all questions. Write your answer in blue or black ink /ballpoint. You can only use a pencil for graphs, charts, diagrams etc. Please ensure your answer were written clearly. All answer must be correctly numbered but need not be in numerical order. Workings must be shown. You can use mathematical and statistical tables. You may use a calculator gives no printout, has no word display facilities is silent and cordless. The provision of batteries and their condition is your responsibility.

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