Question 3 You are the co-founder of INCA Medical Devices, a medical device company that has been trading for the past two years. You have now made the decision to seek external investment into the company to expand into overseas markets. As part of the due diligence process, potential investors have asked you to prepare a cash flow statement for the first quarter 2017. Your records show INCA Medical Devices will have the following balances on the 1st January 2017: Bank overdraft 200,000 Debtors 250,000 Creditors 100,000 In addition, you anticipate the following transactions during the next three months: New bank loan of 200,000 to cover present overdraft on the 19 January 2017 to be repaid 25,000 every quarter starting 315 March 2017 Sales and purchases on one month's credit as follows: Sales Purchases January 300,000 100,000 February 360,000 120,000 March 480,000 160,000 Payroll costs of 50,000 each month. Internal R&D costs as follows: January 100,000 February 120,000 March 150,000 Outsourced lab testing of 25,000 in January and a further 25,000 in March, paid at the end of the month in which the cost is incurred. New patent filing costs of 5,000 in February 2017, with on- going IP fees of 1,000 per month. Advertising & Promotion costs of 4,000 per month, with an additional charge of 5,000 in March to cover a national medical devices sales event. Debtors and creditors must be cleared within the month. Please answer the following questions: (a) Prepare a cash flow statement for the three-month period ending (20 Marks) 315 March 2017 (b) What level of investment would be required in order to have a (5 Marks) closing balance of the 31" March 2017 of 500,000