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Adaeze Nwobu

Practice Activity 9.26 Preparation of statement of cash flows using the indirect method of reporting

From the following information pertaining to Onyinyechukwu Limited, prepare a statement of cash flows for the year ended 31 December 2020.




Additional information about the financial performance of the business for the year ended 31 December 2020 is:

  1. The profit before interest and income tax is ₦62,061.

  2. Provision for doubtful debt is ₦3,251.50. This amount had been deducted from trade receivables.

  3. The income tax on profits is ₦21,808.85.

  4. Loan interest paid amounts to ₦1,000.

  5. Investment income is ₦1,250.

  6. On 1 January 2019, the company acquired building and equipment. Costs of building and equipment are ₦60,000 and ₦25,000, respectively. Building and equipment are depreciated on reducing balance bases of 20% and 25%, respectively.


Approximate the amounts in the solution to 2 decimal places.


See a suggested solution to practice activity 9.26 here.


Suggested solution to practice activity 9.26













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