SydMel Ltd Statement of financial position As of 30 June 2020. 2020 2019 Assets Cash at Bank 18000 - Account Receivable 34000 28000 Inventories 112000 96000 Land 40000 80000 Buildings 120000 120000 Accumulated depreciation-Buildings (10000) (6000) Equipment 72000 60000 Accumulated depreciation-Equipment (30000) (18000) Total assets 356000 360500 Liabilities Account Payables 52000 48000 Bank Overdraft - 20000 Equity Share Capital 214000 200000 Retained Earnings 90000 92500 Total liabilities and equity 356000 360500 SydMel Ltd Statement of profit and loss and other comprehensive income For the year ended 30 June 2020. 2020 income $ $ Sales revenue - 445500 Less: expenses Cost of sales 288000 Employee expenses 78000 Interest expenses 5000 Loss on sale of land 6250 Depreciation expenses-buildings 5000 Depreciation expenses-equipment 15000 412250 Profit for the year 33250 Additional information During the year ended 30 june 2020 cash dividend were paid to shareholders. Building expenses were paid for during the year and a block of land costing 37320 was sold for 31250 No plant was purchased or sold during the year. Required Prepare reconciliation note for disclosure of cash flow from operating activities with profit.
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
SydMel Ltd
As of 30 June 2020.
|
|
2020 |
2019 |
|
Assets |
|
|
|
Cash at Bank |
18000 |
- |
|
|
34000 |
28000 |
|
Inventories |
112000 |
96000 |
|
Land |
40000 |
80000 |
|
Buildings |
120000 |
120000 |
|
Accumulated |
(10000) |
(6000) |
|
Equipment |
72000 |
60000 |
|
Accumulated depreciation-Equipment |
(30000) |
(18000) |
|
Total assets |
356000 |
360500 |
|
Liabilities |
|
|
|
Account Payables |
52000 |
48000 |
|
Bank Overdraft |
- |
20000 |
|
Equity |
|
|
|
Share Capital |
214000 |
200000 |
|
|
90000 |
92500 |
|
Total liabilities and equity |
356000 |
360500 |
SydMel Ltd
Statement of
For the year ended 30 June 2020.
|
|
|
2020 |
|
income |
$ |
$ |
|
Sales revenue |
- |
445500 |
|
Less: expenses |
|
|
|
Cost of sales |
288000 |
|
|
Employee expenses |
78000 |
|
|
Interest expenses |
5000 |
|
|
Loss on sale of land |
6250 |
|
|
Depreciation expenses-buildings |
5000 |
|
|
Depreciation expenses-equipment |
15000 |
412250 |
|
Profit for the year |
|
33250 |
Additional information
- During the year ended 30 june 2020 cash dividend were paid to shareholders.
- Building expenses were paid for during the year and a block of land costing 37320 was sold for 31250
- No plant was purchased or sold during the year.
Required
Prepare reconciliation note for disclosure of cash flow from operating activities with profit.
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