Question

Question 4 (30 marks) The following represents the financial statements of Cash Smart (Pty) Ltd. Us the information contained therein and other information provided to answer the questions that follow Statement of Comprehensive Income for Cash Smart (Pty) Ltd for the year ended 30 June 2020 RODO Sales revenue 95 576 Cost of sales 62 000 Gross profit 33 576 Other operating Income 6 000 Gross operating pront 39 576 Operating expenses 35 250 4326 Operating pro Financing costs 2 400 Pront before taxation 1926 Taxation for the year 578 Profit after taxation 1 348 Statement of Financial Position for Cash Smart (Pty) Ltd as at 30 June 2020 2020 2019 ROOD R1000 Assets Non-current assets Property, plant and Equipment (carrying value) 21350 19 850 Current assets Inventories 7 142 7 380 Trade receivables 15 952 12 988 Cash and cash equivalents 13 092 9 876 Total assets 57 536 50 094 Equity and abilities Ordinary share capital (par value of 0.50) Share premium Retained earnings Non-current liabilities 12 000 6 000 5 235 LO 000 5 000 4 607

Answer 1

Part (4.1) As it is mentioned to use T accounts, follow direct method of cash flow statement.

Cash Smart (Pty) Ltd.

Cash Flow Statemet

For the year ended June 2020

Particulars	Amount	Amount
Cash from operating activities
Receipt from Customers	92,612.00
Payment to creditors	(61,980.00)
Other Operating Income	6,000.00
Payment for Operating Expenses (working note 6)$\left ( 35250-1000 \right )=34250$	(34,250.00)
Tax Paid during the year	(546.00)
Cash from operating activities		1,836.00
Cash from Investing activities
Purchase of Fixed assets (Working Number 4)	(2,500.00)
Cash from Investing activities		(2,500.00)
Cash from Financing activities
Finance Cost	(2,400.00)
Dividend Paid $\left ( \frac{12000}{50} \right )\times 3=720$	(720.00)
Issue of Share Capital (12000-10000=2000)	2,000.00
Loan Taken (24000-20000=4000)	4,000.00
Share Issue Premium (6000-5000=1000)	1,000.00
Cash from Financing activities		3,880.00
Net Cash Flow During the year		3,216.00
Opening Cash and Cash Equivalent		9,876.00
Closing Cash and Cash Equivalent		13,092.00

Part (4.2)

Working Notes

wy o 4,2 1 pr Particulars To bulbid To sales Trade Recivables G 어 $ Particulary $ 12,988 By cash (bol) 92,612 95576 By balad 15962 108564 108 564

ܕܓ0 WIN 4.2. Calculation of Trade Payable Particulars $ Particulare $ 61980 9322 By Purchare 61,762 Chlon 3) To balcld 9104 71,084 1084 To cash (Bal fig) By bal.bld Purchases Who 1.282, ( 7380 ) Closing Inventary Opening Inventary Cost of Sales pelfig. 7142 6200 61762 Purchares

ONU 4.2.4 Dr. Particules $ G Tax Payable To cash (bal sig s46 By bal old Particular B 1165 By Taxferthy S78 Tobal ald 1197 743 1743

5. Purchase of Fixed Assets

Opening 19,850.00

Depreciation (1,000.00)

Closing (21,350.00)

Purchases (2,500.00)

6. Depreciation of 1 m is a non cash expenses.