Question 3a
Marking Guide

(a) (i) Operating profit 1
Interest payable 1
Tax payable for normal activities 1
Depreciation 1
Profit on disposal of non-current assets 1
Cash from disposal of non-current assets 1
Investment in new non-current assets 2
Investment in working capital 1
Dividend remittance from Bowerscots Co 1
Additional tax payable on Bowerscots Co profits 1
––––
11
––––
(ii) Dividend capacity required 1
Increase in dividend remittance 1
Revised level of dividend required (% level or absolute amount) 1
––––
3
––––