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A statement of cash flows is provided below for Sentosa Berhad. Sentosa Berhad Statement of Cash Flows For the year ended December 31, 2018 RM
A statement of cash flows is provided below for Sentosa Berhad. Sentosa Berhad Statement of Cash Flows For the year ended December 31, 2018 RM 40,698 Operating Activities Net income Adjusted for: Increase in accounts receivable Increase in inventory Increase in accounts payable Increase in prepaid expenses Decrease in other payables Depreciation and amortisation Net cash flow from operating activities (23,034) (36,780) 22,479 (12,340) (3,982) 35,612 22,653 Investing Activities Sale of plant assets 86,511 Financing Activities Repayment of debt (115,240) Net decrease in cash Cash balance, December 31, 2017 Cash balance, December 31, 2018 (6,076) 15,495 9,419 Required: Use the above statement of cash flows to answer the following questions: (i) How much cash flow did the company create from its operating and investing activities? (2 marks) (ii) What are the primary explanations for the difference between the company's net income and operating cash flow? (4 marks)
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