快速查題-ACCA英國注冊會計師試題

Geofost is preparing its statement of cash flows for the year ended 31 October 20X7. You have been presented with the

following information.

GEOFOST

STATEMENT OF PROFIT OR LOSS FOR THE YEAR ENDED 31 OCTOBER 20X7

Profit from operations??????????? 15,730

Finance cost????????????????????????? ??(730)

Profit before tax???????????????????? 15,000

Taxation???????????????????????????????? (4,350)

Profit for the year?????????????????? 10,650

Required

Prepare a statement of cash flows for Geofost for the year ended 31 October 20X7 in accordance with IAS 7 Statement of

cash flows, using the indirect method.

Which of the following events occurring after the reporting period are classified as adjusting, if material?

1?The sale of inventories valued at cost at the end of the reporting period for a figure in excess of cost

2?A valuation of land and buildings providing evidence of an impairment in value at the year end

3?The issue of shares and loan notes

4?The insolvency of a customer with a balance outstanding at the year end

The financial statements of Overexposure Co for the year ended 31 December 20X1 are to be approved

on 31 March 20X2. Before they are approved, the following events take place.

1?On 14 February 20X2 the directors took the strategic decision to sell their investment in Quebec Co despite the fact that this investment generated material revenues.

2?On 15 March 20X2, a fire occurred in the eastern branch factory which destroyed a material amount of inventory. It is

estimated that it will cost $505,000 to repair the significant damage done to the factory.

3?On 17 March 20X2, a customer of Overexposure Co went into liquidation. Overexposure has been advised that it is unlikely

to receive payment for any of the outstanding balances owed by the customer at the year end.

How should these events reflected in the financial statements at 31 December 20X1?

Adjust????????????????????? ?Disclose?????????????????????????? Do nothing

Which of the following events between the reporting date and the date the financial statements are authorised for issue must

be adjusted in the financial statements?

1?Declaration of equity dividends

2?Decline in market value of investments

3?The announcement of changes in tax rates

4?The announcement of a major restructuring

Which of the following is the correct definition of an adjusting event after the reporting period?

If a material event occurs after the reporting date but before the financial statements are authorised for issue outside the

organisation, and this event does NOT require adjustment, what information should be disclosed in the financial statements?

Which of the following items could appear in a company's statement of cash flows?

1?Surplus on revaluation of non-current assets

2?Proceeds of issue of?shares

3?Proposed dividend

4?Irrecoverable debts?written off

5?Dividends received

Part of the process of preparing a company's statement of cash flows is the calculation of cash inflow from operating activities.

Which of the following statements about that calculation (using the indirect method) are correct?

1?Loss on sale of operating non-current assets should be deducted from net profit before taxation.

2?Increase in inventory should be deducted from operating profits.

3?Increase in payables should be added to operating profits.

4?Depreciation charges should be added to net profit before taxation.

In the course of preparing a company's statement of cash flows, the following figures are to be included in the calculation of

net cash from operating activities

??????????????????????????????????????????????????????????????? $

Depreciation charges????????????????????? ?980,000

Profit on sale of non-current assets ? ?40,000

Increase in inventories???????????????????? ?130,000

Decrease in receivables???????????????? ?? 100,000

Increase in payables???????????????????? ????? 80,000

What will the net effect of these items be in the statement of cash flows?

?Part of a company's draft statement of cash flows is shown below:

??????????????????????????????????????????????????????????? ?$!000

Net profit before tax???????????????????????????? 8,640

Depreciation charges???????????????????????? (2,160)

Proceeds of sale of non-current assets? 360

Increase in inventory???????????????????????????? (330)

Increase in accounts payable??????????????? ?440

The following criticisms of the above extract have been made:

1?Depreciation charges should have been added, not deducted.

2?Increase in inventory should have been added, not deducted.

3?Increase in accounts payable should have been deducted, not added.

4?Proceeds of sale of non-current assets should not appear in this part of the statement of cash flows.

Which of these criticisms are valid?