Equity PLC has the following balance sheets and income statement for the year ending 31st October 2013
|Balance Sheets as at 31st October:|
|£ ‘000||£ ‘000||£ ‘000||£ ‘000||£ ‘000||£ ‘000|
|Non current asssets|
|Land & Buildings||58,000||12,000||46,000||40,000||10,000||30,000|
|Plant & Machinery||32,500||14,500||18,000||30,000||12,000||18,000|
|Current Asset Investment||5,000||0|
|Ordinary Share Capital||35,000||30,000|
|Share Premium Account||10,000||8,000|
|Non Current Liabilities|
|Finance and Accounting for Managers||5|
|Total Equity and Liabilities||129,000||118,000|
|Income Statement for the year ending 31st October 2013:|
|Cost of Sales||-48,000|
|Other operating expenses||-35,000|
|Profit before interest||15,000|
|Profit before taxation||13,800|
|Profit after taxation||11,000|
The following additional information is available:
- Equity PLC recorded an increase in the value of its land of £2,000,000 during the year.
- The company has proposed dividends of £8,000 for the year.
- During the year, an item of machinery that originally cost £3,000,000 was sold for £500,000 – making a loss of £1,000,000. This item is included in the operating expenses.
- Prepare a Cash Flow Statement for the year ended 31st October 2013 in accordance with IAS 7 (revised), using the indirect method.
- Prepare a Business Report commenting on the cash position of Equity PLC.
- Reporting entity
Equity Plc (the ‘Company‘) is domiciled in United Kingdom. The Company is primarily involved in manufacturing xxx.
- Basis of accounting
The Consolidated statement of cash flows has been prepared in accordance with IFRS. They were authorised for issue on 21 June 2017.
- Functional and presentation currency
The Consolidated statement of cash flows is presented in GBP, which is the Company’s functional currency. All amounts have been rounded to the nearest thousand, unless otherwise indicated.
- Notes on operating cash flows