The following are the summarised financial statements of Madras Electronic Ltd.

Balance Sheets Liabilities 31st 31st Assets 31st 31st Dec. Dec. Dec. Dec.

2004 2005 2004 2005 Rs. Rs. Rs. Rs.

Equity Share 1,000 1,000 Fixed Assets 4,000 4,500 Capital Debentures 2,000 2,000 (Less: Depreciation) 650 500 3,350 650 Retained Earning 1,500 2,000 Inventory 1,250 1,500 Sundry Creditors 900 1,000 Accounts Receivable 650 500 Bills Payable 400 500 Debtors 650 500 Outstanding Wages 200 300 Cash 400 500 Accrued Taxes 300 200 _____ _____ 6,300 7,000 6,300 7,000 Income Statement for 2005

(Rs. In thousands)

Sales 10,000 Cost of Goods Sold 5,000 Administration and Selling Expenses 1,500 Depreciation 300 Interest 200 7,000 Net Income before Taxes 3,000 Taxes 1,500 Net Income after Taxes 1,500 Prepare for the year ended 31st December, 2008

(a) A Statement of Sources and Applications of Funds.

(b) A Statement showing the Changes in Working Capital.