> of 4 Luke Ltd is considering to finance their acquisition of $100,000 in new equipment in year 1 Luke director board decided to borrow $90.000 from a local bank. The bank has asked them to produce a 3 year cash flows broken down by vear Year 1, 2 and 3). Sales in the prior year were $100.000 and are expected to increase 20 percent each year so that sales of $120,000 are expected in the first year. Collections in the year of sale are expected to be 90 percent, with the remaining 10 percent collected in the next year Purchases are based on an expected cost 30 percent of sales and required ending inventory of 20 percent of next year's sales Prior year expenses included advertising expense of $2.500, depreciation expense of $500, wages expense of $20.000, supplies expense of $400, and utilities expense of $300. AN expenses except depreciation and interest expenses are paid in the year in which they are incurred and we expected to increase 8 percent each year Interest expense is expected to remain constant at 5600 each year for years 1- Payments in the year of purchase are expected to be 80 percent, with the remaining 20 percent paid in the next year. Proceeds from the 590,000 loan are expected in year 1 and 5100,000 of equipment will be purchased during year 1. In sub-quent years equiment purchases are expected to be $10,000 each year. Proceeds from projected equipment les each year are expected to amount to $8,000 Annual payments of $30,000 on the loan also begin in year. The cash balance in the prior year was $26.400 and the beginning inventory in the pror year was 6,500 Task Lise Excel to create a cash flows statement based on the assumptions just provided. The Excel worksheet should include cash recette cash payment cash from to operating activities, cash from (to) Investing activities and cash from (to financing activities... by using define names and forms (45 marks hp FO 2 6 0 3 7 ol: 8 9 o O Y O