Texts: The following cash flow statement relates to Kibo Ltd.
2018 2019
Sh 000's Sh 000's
Operating Activities
Profit before tax 40 1,220
Adjustment for Depreciation buildings 25 300
Depreciation (plant) (100) 1,047
Profit on redemption of debentures (1,000) 300
Profit on plant disposal 900 1,600
Increase in stocks 1,200 250
Decrease in debtors 900 1,247
Increase in creditors 20 360
Net cash inflow from operating activities 1,520 1,600
Investing Activities
Purchase of plant and machinery (617) (50)
Purchase of investments 35 1,520
Proceeds on plant disposal (150) (632)
Net cash outflow from investing activities (632) (091)
Financing Activities
Issue of loans 220 1,220
Redemption of preference shares (550) (550)
Issue of debentures 90 1,190
Redemption of debentures (900) (1,000)
Dividends paid (400) (450)
Net cash outflow from financing activities (1,540)
Net decrease in cash and cash equivalents (510) 390
Cash and cash equivalents bf 25 415
Cash and cash equivalents cf 415
Required:
a. Provide a summary to help in understanding the cash flow for Kibo Ltd.
b. Undertake a common-size using both approaches. The net revenue for the firm was $101,000,000.
