Question 1 (30 Marks) Fuzzy Limited is the largest manufacturer of pillows in the country. The statement of comprehensive income and statement of changes in equity of Fuzzy Limited for the year ended 31 December 2020, as well as the statement of financial position of the company at 31 December 2020, are shown below: FUZZY LIMITED R STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2020 Revenue 4 141 000 Cost of sales (2 125 000) Gross profit 2016 000 Distribution expenses (325 000) Administration expenses (367 400) Finance cost (18 740) Profit before tax 1 304 860 Income tax expense (365 361) Profit for the period 939 490 2/3 FUZZY LIMITED TRIAL BALANCE (EXTRACT) AT 31 DECEMBER 2020 2020 2019 Inventories 654 000 614 000 Accounts receivable 396 500 274 500 Prepaid distribution expense 24 740 0 Cash and cash equivalents 53 250 18 750 Accounts payable (287 000) (250 000) Current tax payable (23 400) (17400) Accrued administrative expenses (32 410) (47 800) Accrued finance costs (13400) (12 400) Additional information: The administrative expenses include: A gain on the disposal of non-current assets amounting to R4 750 Bad debts written off during the year amounting to R14 850. Cost of sales includes depreciation of R174 500. Assume that all transactions are for cash unless otherwise indicated. Required: Prepare a statement of cash flows of Fuzzy Limited for the year ended 31 December 2020, showing the cash from operating activities only, using the direct method