EBS's financial statements for 2013/2014 include the following:

EBS’s financial statements for 2013/2014 include the following:

EBS Statement of profit or loss and other comprehensive income for the

year ended 30 June 2014

Revenue 2,610

Cost of sales (vi),(viii) (890)

Gross Profit 1,720

Administrative expenses (180)

Distribution costs (125)

Profit from operations 1,415

Finance cost (57)

Profit before tax 1,358

Income tax expense (160)

Profit for the period 1,198

Other comprehensive income – items that will

not be reclassified subsequently to profit or loss

Revaluation gain on properties (ii) 345

1,543

EBS Statements of financial position at 30 June 2014 2013

Note $000 $000 $000 $000

Non-current assets

Property, plant and equipment (i),(ii),(iii) 5,200 4,890

Deferred development expenditure (vi) 184 76

Brand name (vi) 45 5,429 60 5,026

Current assets

Inventories 130 105

Trade receivables 273 189

Cash and cash equivalents 169 572 210

Total Assets

504

6,001

Equity and liabilities

5,530

Equity

Equity shares (vii) 2,200 1,800

Share premium (vii) 580 400

Revaluation reserve (ii) 345 0

Retained earnings 2,006 1,420

Total equity 5,131 3,620

Non-current liabilities

Long term loans 0 1,435

Deferred tax 196 110

Preferred shares (vii) 300 496 0 1,545

Current liabilities (iv) 374

Total equity and liabilities

365

6,001 5,530

Additional information:

(i) Non-current assets – property, plant and equipment, balances at 30 June were:

2014 2013

Cost or valuation: $000 $000

Property 3,825 3,900

Plant 3,000 2,850

Equipment 1,235 1,120

8,060 7,870

Depreciation:

Property 45 420

Plant 2,000 1,700

Equipment 815 860

2,860 2,980

Net book value 5,200 4,890

Financial Operations 15 September 2014

(ii) On 1 July 2013 property was revalued to $3,825,000. At that time the average

remaining life of property was 85 years. Property is depreciated on a straight line

basis.

(iii) Equipment with a carrying value of $60,000 (original cost $210,000) was sold during

the year for $25,000. Any gain/loss on disposal of property, plant and equipment is

included in profit or loss.

(iv) Current liabilities:

(v) EBS paid a dividend on its equity and preferred shares during the year ended 30

June 2014.

(vi) Cost of sales includes $27,000 for development expenditure amortised during the

year and $15,000 for impairment of the purchased brand name.

(vii) On 1 November 2013, EBS issued $1 equity shares at a premium. On 1 July 2013

EBS issued 6% cumulative redeemable preferred shares at par. No other finance was

raised during the year.

(viii) Other provisions relate to legal claims made against EBS during the year ended 30

June 2014. The amount provided is included in cost of sales.

(Total for Section c = 50 marks)

End of Question Paper

Maths Tables and Formulae are on Pages 17 and 18

2014 2013

$000 $000

Trade payables 218 230

Loan interest payable 4 15

Tax payable 90 120

Other provisions (see viii) 62 0

Total current liabilities 374 365

Required:

Prepare EBS’s Statement of cash flows, using the indirect method, for the year ended

30 June 2014 in accordance with IAS 7 Statement of Cash Flows.