CIE IGCSE Topical Past Paper 1

5.4 Statement of financial position

0450/11/O/N/2025

CPW is a private sector business which has many objectives. It sells electrical goods including kettles and ovens in its 36 shops in country X. CPW also offers a delivery service. The business buys all its inventory from local suppliers to avoid import tariffs. The Finance Director is analysing CPW’s statement of financial position. An extract is shown in Table 2.1. He has been asked to find a source of finance to purchase 10 new delivery vehicles.

Extract from CPW’s statement of financial position for 2024 ($ million)
Non-current assets	120
Current assets	70
Current liabilities	110
Non-current liabilities	75

Table 2.1

(b) Identify one non-current asset and one current liability. [2]
Non-Current Assets:
Current Liability:

045/12/M/J/2024

IDT manufactures clothes for the mass market. It is a multinational company with factories in 4 countries. IDT has short-term and long-term financial needs. The Finance Director is analysing IDT’s statement of financial position. An extract is shown in Table 3.1. He has been asked to calculate working capital and to explain how an increase in non-current liabilities might affect IDT.

Extract from IDT’s statement of financial position ($ million)
	2022	2023
Current assets	380	420
Current liabilities	250	280
Non-current liabilities	300	400

Table 3.1

d) Explain two ways an increase in non-current liabilities might affect IDT.
Way 1:
Explanation:

Way 2:
Explanation: