Flora commenced business on 1 January 2013 as a sole trader, 'Flora's', selling flowers at the local market. The following transactions occurred for the first six months of operations.
Contributed $7000 of savings into a business bank account
Purchased flowers on credit, $13 500
Purchased second-hand van, $13 000
Cash collected from flower sales, $32 600
Depreciation on van, $1000
Cash paid for expenses, $8250
Paid creditors for flowers purchased earlier, $10 000
Borrowed $6000 from a cousin
Flora withdrew $8000 for personal expenses
Required:
A. Prepare an income statement for the six months.
B. Prepare a statement of cash flow for the six months.