Question

Additional information Kantemba group sold its 100% shareholding of its subsidiary Marko Holding for K75 on...

Additional information

Kantemba group sold its 100% shareholding of its subsidiary Marko Holding for K75 on 31st December, 2014 when its statement of financial position indicated the following:

Machinery

38

Inventory

14

Receivables

6

Payables

(4)

Tax

(3.5)

Required:

The accountant omitted the above disposal, prepare the new statement of cash flow for Kantemba

Kantemba Group cash flow statement for year 31st December,2014

Operating activities

K

Profit before tax

400.00

Add back depreciation

35.50

Less gain on disposal

(50.00)

add decrease in inventory

27.00

Add decrease in receivables

20.00

Less decrease in payables

(52.00)

Add increase in accrued utilities

27.80

Less tax paid

(97.20)

Total cash from operating activities

311.10

Investing activities

Purchase of plant assets

(350.00)

Purchase of investment

(64.00)

Disposal of investment

105.00

(309.00)

Financing activities

issue of new shares

-

Dividends paid

(78.00)

Bonds purchased

59.00

Total cash from financing

(19.00

Net cash flow for the year

(16.90)
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