QUESTION 2 - Statement of Cash Flows You are provided with the following financial information for Just Wind. JUST WIND COMPARATIVE BALANCE SHEETS AS AT DECEMBER 31 2019 2018 Current Assets Cash at Bank 1 500 5 200 Accounts Receivable (net) 4950 4 180 Interest Receivable 250 320 Inventory 20 000 18 000 Prepaid Expenses 1650 $28 350 __800 $28 500 Non-Current Assets Plant & Equipment 74 000 64 000 less Acc. Depreciation (23 000) 51 000 (17600) 46 400 Total Assets 79 350 74 900 3 660 340 Current Liabilities Accounts Payable Interest Payable Expenses Payable Tax Payable Non-Current Liabilities Loan Payable Total Liabilities Net Assets 3 290 510 790 1 200 780 720 5500 5790 25 660 31 160 $48 190 20 000 25 790 $49 110 Equity Capital $48 190 $49 110 JUST WIND INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31 2019 $93 000 $54 200 Net Sales Cost of Sales less Discount Received Gross Profit Other Revenue: Interest Revenue 400 53 800 39 200 160 160 39 360 19 000 200 100 Expenses: Selling & Admin Expense Bad Debts Expense Discount Allowed Depreciation Expense Interest Expense Profit before tax Tax expense Profit 5 400 2400 27 100 12 260 3 378 $8 882 Additional Information: There were no sales of non-current assets during the period. The owner withdrew $20 000 cash during the period. REQUIRED: a Prepare a Statement of Cash Flows in the format required by applicable accounting standard. Use the pro forma in the exam answer booklet and show all calculations [15 marks] b. Provide a brief summary explaining whether the business is financially healthy or not. Use the information you created in part (a) to answer part (b). [5 marks) TOTAL FOR QUESTION 2: 20 Marks
QUESTION 2 - Statement of Cash Flows You are provided with the follow
QUESTION 2 - Statement of Cash Flows You are provided with the following financial information for Just Wind. JUST WIND COMPARATIVE BALANCE SHEETS AS AT DECEMBER 31 2019 2018 Current Assets Cash at Bank 1 500 5 200 Accounts Receivable (net) 4950 4 180 Interest Receivable 250 320 Inventory 20 000 18 000 Prepaid Expenses 1650 $28 350 __800 $28 500 Non-Current Assets Plant & Equipment 74 000 64 000 less Acc. Depreciation (23 000) 51 000 (17600) 46 400 Total Assets 79 350 74 900 3 660 340 Current Liabilities Accounts Payable Interest Payable Expenses Payable Tax Payable Non-Current Liabilities Loan Payable Total Liabilities Net Assets 3 290 510 790 1 200 780 720 5500 5790 25 660 31 160 $48 190 20 000 25 790 $49 110 Equity Capital $48 190 $49 110 JUST WIND INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31 2019 $93 000 $54 200 Net Sales Cost of Sales less Discount Received Gross Profit Other Revenue: Interest Revenue 400 53 800 39 200 160 160 39 360 19 000 200 100 Expenses: Selling & Admin Expense Bad Debts Expense Discount Allowed Depreciation Expense Interest Expense Profit before tax Tax expense Profit 5 400 2400 27 100 12 260 3 378 $8 882 Additional Information: There were no sales of non-current assets during the period. The owner withdrew $20 000 cash during the period. REQUIRED: a Prepare a Statement of Cash Flows in the format required by applicable accounting standard. Use the pro forma in the exam answer booklet and show all calculations [15 marks] b. Provide a brief summary explaining whether the business is financially healthy or not. Use the information you created in part (a) to answer part (b). [5 marks) TOTAL FOR QUESTION 2: 20 Marks
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