Question

Below are the statements of financial position of ABC Ltd for the financial year ending 31 December 2019 and 2018 together with additional information related to other events in the 31 December 2019 financial year. ABC Balance Sheet as at 31 December 2019 2019 2018 Assets Cash Accounts receivables Inventory Prepaid expenses Long-term investments Land Buildings and equipment Accumulated depreciation TOTAL ASSETS 30 000 410 000 300 000 20 000 50 000 560 000 2 000 000 -800 000 2 570 000 50 000 460 000 320 000 15 000 25 000 300 000 1 900 000 -770 000 2 300 000 Liabilities & Equity Accounts payable Accrued Liabilities Bonds issued Long term loan Ordinary Share capital, R2 par value Paid-in-capital in excess of par value Retained earnings TOTAL LIABILITIES & EQUITY 300 000 40 000 500 000 150 000 200 000 710 000 670 000 120 000 50 000 800 000 0 160 000 550 000 620 000 2 570 000 2 300 000

Answer 1

1)
ABC Limites
Statement of Cash Flow
For the Year ended ,December 31st 2019
Cash Flow from Operating Activities
Net Income		$                                    1,10,000.00
Operating Activities
Depreciation Expense	$                                                           60,000.00
Loss on sale of Equipment($50000-$30000-$17000)	$                                                              3,000.00
Decrease in Accounts Receivable($410000-$$460000)	$                                                           50,000.00
Decrease in Inventory($300000-$320000)	$                                                           20,000.00
Increase in Prepaid Expenses($20000-$15000)	$                                                            -5,000.00
Increase in Accounts Payable($300000-$120000)	$                                                        1,80,000.00
Decrease in Accrued Liabilites($40000-$50000)	$                                                          -10,000.00
		$                                    2,98,000.00
Net Cash Provided by Operating Activity=(A)		$                                    4,08,000.00
Cash Flow from Investing Activities
Sale of Equipment	$                                                           17,000.00
Purchase of Land	$                                                      -2,60,000.00
Purchase of Investment	$                                                          -25,000.00
Cash Flow from Investing Activities=(B)		$                                   -2,68,000.00
Cash Flow fom Financing Activities
Issue of Common Stock	$                                                        2,00,000.00
Retirement of Bonds Payable	$                                                      -3,00,000.00
Payment of Dividends(Working below)	$                                                          -60,000.00
Net Cash used by Financing Activities=(C)		$                                   -1,60,000.00
Net Increase in cash=(D )=(A)+(B)+(C )		$                                      -20,000.00
Cash at the beginning of the period=(E )		$                                        50,000.00
Cash at the end of the period=(D )+(E )		$                                        30,000.00
Accumulated Depreciation
	$                                                           30,000.00	Beginning balance	$                 7,70,000.00
Ending balance	$                                                        8,00,000.00	Depreciation Expense	$                     60,000.00
Total	$                                                        8,30,000.00	Total	$                 8,30,000.00
Equipment
Beginning Balance	$                                                     19,00,000.00	Bank	$                     17,000.00
Long Term Note Payable	$                                                        1,50,000.00	Accumulated Depreciation	$                     30,000.00
		Loss on sale of Equipment	$                       3,000.00
		Balance C/d	$               20,00,000.00
Total	$                                                     20,50,000.00	Total	$               20,50,000.00
Investment
Beginning Balance	$                                                           25,000.00
Bank	$                                                           25,000.00
		Balance C/d	$                     50,000.00
Total	$                                                           50,000.00	Total	$                     50,000.00
Bonds Payable
		Beginning balance	$                 8,00,000.00
Cash	$                                                        3,00,000.00
Ending balance	$                                                        5,00,000.00
Total	$                                                        8,00,000.00	Total	$                 8,00,000.00
Beginning Retained Earnings	$                                                        6,20,000.00
Add: Net Income	$                                                        1,10,000.00
	$                                                        7,30,000.00
Less: Ending Retained Earnings	$                                                      -6,70,000.00
	$                                                           60,000.00
Long Term Note Payable
		Beginning balance	$                                    -
		Building and Equipment	$                 1,50,000.00
Ending balance	$                                                        1,50,000.00
Total	$                                                        1,50,000.00	Total	$                 1,50,000.00