JJ Architecture had the following cash transactions during the financial year ending 30 June 2022. The opening cash balance at 1 July 2021 was $45,000.

Transaction	Amount
Receipts from customers	$173,000
Loan Drawdown	$20,000
Income Tax Paid	$4,200
Payments to suppliers	$65,000
Payment for new equipment	$17,000
Interest Paid	$2,500
Payments to employees	$78,000
Drawings	$5,000

Prepare a Cash Flow statement for JJ Architecture for the year ending 30 June 2022 using the information provided.

[8 marks]

Explain why depreciation is not included in the Cashflow Statement. Your answer should include an explanation of the difference between accrual and cash accounting (max 300 words).

[4 marks]

Explain whether this business could possibly have a loss in the Income Statement. Explain your answer by providing an example (max 300 words).

[3 marks]