QUESTION ONE [25] The following financial information relates to Cams Limited. Statement of Financial Position as at...

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QUESTION ONE [25]
The following financial information relates to Cams Limited.
Statement of Financial Position as at 31 December 2017and 2018
2018                              2017
Ordinary share capital
Retained earnings
Property, plant and equipment
Investments
Debentures 12.5%
Inventory
Trade debtors
Prepaid expenses
Trade creditors
Bank overdraft
SARS (income tax)
Shareholders for dividends
                         400 000
                           55 000
                          230 000
                         165 000
                            20 000
                         124 000
                           37 000
                             -
                          25 000
                           21 000
                             5 000
                             30 000
              295 000
                  5 000
              195 000
               110 000
                 60 000
               120 000
                  28 500
                    1 500
                  42 500
                  25 000
                     7500
                   20 000
Statement of comprehensive income for the year 31December2018                      R
Profit before interest and tax
Depreciation on equipment
Dividends received on investments
Interest on dividends
Income tax
149 500
5 000
18 000
7 500
50 000
Statement of changes in equity for the year ended 31December 2018 R
Dividends on ordinaryshares                                            R 60 000
Note no. 1 for the year ended 31 December 2017 and2018
Property, plant andequipment                                     2018(R)              2017 (R)
Land and building atcost                                                200000                160 000
Equipment at carryingvalue                                              30000               35 000
                                                                                         230000             195 000
Additional information
1. No equipment was purchased or sold during the financial yearended 31 December 2018
2. Ordinary shares were issued during the year.
Required:
Use the information provided above to prepare the cash flowstatement for the year ended 31 December 2018.

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IN THE BOOKS OF CAMS LTD

CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2018

PARTICULARS	R	R
PROFIT BEFORE INTEREST AND INCOME TAX	149500
ADD: DEPRECIATION ON EQUIPMENT	5000
ADD: INCREASE IN CURRENT LIABILITIES	0
ADD: DECREASE IN CURRENT ASSETS PREPAID EXPENSES	1500
LESS: DECREASE IN CURRENT LIABILITIES TRADE CREDITORS BANK OVERDRAFT	(17500) (4000)
LESS: INCREASE IN CURRENT ASSETS INVENTORY	(4000)
TRADE DEBTORS	(8500)

LESS: INCOME TAX PAID	(50000)
NET CASH FROM OPERATING ACTIVITIES (A)		72000
CASH FLOW FROM INVESTING ACTIVITIES
PURCHASE OF LAND AND BUILDING	(40000)
PURCHASE OF INVESTMENTS DIVIDENDS RECEIVED ON INVESTMENTS	(110000) 18000
NET CASH FROM INVESTING ACTIVITIES (B)		(132000)
CASH FLOW FROM FINANCING ACTIVITIES
ISSUE OF SHARES	105000
REDEMPTION OF DEBENTURES	(40000)
PAYMENT OF DIVIDEND	(60000)
INTEREST ON DEBENTURES	(7500)
NET CASH FROM FINANCING ACTIVITIES (C)		(2500)
CASH FLOW DURING THE YEAR (A+B+C)		(62500)

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Transcribed Image Text

QUESTION ONE [25]The following financial information relates to Cams Limited.Statement of Financial Position as at 31 December 2017and 20182018 2017Ordinary share capitalRetained earningsProperty, plant and equipmentInvestmentsDebentures 12.5% InventoryTrade debtorsPrepaid expensesTrade creditorsBank overdraftSARS (income tax)Shareholders for dividends 400 000 55 000 230 000 165 000 20 000 124 000 37 000 - 25 000 21 000 5 000 30 000 295 000 5 000 195 000 110 000 60 000 120 000 28 500 1 500 42 500 25 000 7500 20 000Statement of comprehensive income for the year 31December2018 RProfit before interest and taxDepreciation on equipmentDividends received on investmentsInterest on dividendsIncome tax149 5005 00018 0007 50050 000Statement of changes in equity for the year ended 31December 2018 RDividends on ordinaryshares R 60 000Note no. 1 for the year ended 31 December 2017 and2018Property, plant andequipment 2018(R) 2017 (R)Land and building atcost 200000 160 000Equipment at carryingvalue 30000 35 000 230000 195 000Additional information1. No equipment was purchased or sold during the financial yearended 31 December 20182. Ordinary shares were issued during the year.Required:Use the information provided above to prepare the cash flowstatement for the year ended 31 December 2018.