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Registered Posts: 1,774 Beyond epic contributor 🧙‍♂️
Non-Current Assets
Plant - Cost £6,545,000 on 1 Jan 2005
£9,563,000 on 31 Dec 2005

During the year Non-current assets of cost price £2,500,000 were sold

What is the "Purchase of Non-Current Assets" figure that goes in the CashFlow Statement?

I thought it was £3,018,000 but am not sure now. Do I have to include the £2,500,000

Any tips?

• Registered Posts: 997 Epic contributor 🐘
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Hi,

Your cost b/fwd = 6,545. We have disposed of assets costing 2,500 so this gets deducted. Our costs c/fwd to the next year = 9,563 so the "balancing figure" = additions of 5,518.

It is difficult to draw a 'T' account on the forums, but here is another way:

Cost b/fwd = 6,545
Disposed of = (2,500)
Cost c/fwd = (9,563)

Kind regards
Steve
• Registered Posts: 53 Regular contributor ⭐
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If I am right it might be worth going into this a little deeper as it comes up on the cash flow questions. It gives you an opening and closing PPE figure which are both NBV and you have to calculate investment for the year.

But that will probably be the next question
• Registered Posts: 1,774 Beyond epic contributor 🧙‍♂️
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Criggers wrote: »
If I am right it might be worth going into this a little deeper as it comes up on the cash flow questions. It gives you an opening and closing PPE figure which are both NBV and you have to calculate investment for the year.

But that will probably be the next question

It's for a Cashflow I am trying to do it so not sure what you mean by going into it a little deeper?
• Registered Posts: 1,774 Beyond epic contributor 🧙‍♂️
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Hi,

Your cost b/fwd = 6,545. We have disposed of assets costing 2,500 so this gets deducted. Our costs c/fwd to the next year = 9,563 so the "balancing figure" = additions of 5,518.

It is difficult to draw a 'T' account on the forums, but here is another way:

Cost b/fwd = 6,545
Disposed of = (2,500)
Cost c/fwd = (9,563)