Question # 6 Waqar is a sole trader. He provides the following financial information in respect of his business. Income statement for the year ended 31 December 2019 Sales 3380000 Cost of sales (2000000) Expenses (1200000) Profit for the year 180000 Statements of financial position at: 31 December 201831 December 2019 Non-current assets Freehold land 2000000 3500000Plant and machinery at cost900000 1020000 Less: depreciation(500000) (470000) Net book value 400000 550000 2400000 4050000Current assets Inventory 310000 320000Trade receivables 240000 210000Cash and cash equivalents 10000 - 560000 530000 Current liabilities Trade payables 200000 160000Bank overdraft - 530000 200000 690000 Non-current liability – loan 500000 350000Net assets 2260000 3540000Additional information Additional Information:Drawing is $400During the year Winston purchased new plant at a cost of $200 000. He also sold some plant that had a net book value of $20 000 and had been depreciated by $60 000. This resulted in a loss on disposal of $2000. REQUIRED Prepare a statement of cash flows for the year ended 31 December 2019.

The statement of cash flows, or the cash flow statement, is a financial statement that summarizes…

Answered: Prepare a statement of cash flows for…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question # 6

Waqar is a sole trader. He provides the following financial information in respect of his business.

Income statement for the year ended 31 December 2019


Sales		3380000
Cost of sales		(2000000)
Expenses		(1200000)
Profit for the year		180000
Statements of financial position at:
	31 December 2018	31 December 2019

Non-current assets
Freehold land		2000000	3500000
Plant and machinery at cost	900000					1020000
Less: depreciation	(500000)			(470000)
Net book value		400000	550000
		2400000	4050000
Current assets
Inventory		310000		320000
Trade receivables		240000	210000
Cash and cash equivalents		10000	-
		560000		530000
Current liabilities
Trade payables		200000	160000
Bank overdraft		-			530000
		200000	690000
Non-current liability – loan		500000	350000
Net assets		2260000	3540000
Additional information

Additional Information:

Drawing is $400
During the year Winston purchased new plant at a cost of $200 000. He also sold some plant that had a net book value of $20 000 and had been depreciated by $60 000. This resulted in a loss on disposal of $2000.

REQUIRED
Prepare a statement of cash flows for the year ended 31 December 2019.

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