question 4.2

Question 4 (30 marks) The following represents the financial statements of Cash Smart (Pty) Ltd. Use the information contained therein and other information provided to answer the questions that follow: Statement of Comprehensive Income for Cash Smart (Pty) Ltd for the year ended 30 June 2020 R'000 Sales revenue 95 576 Cost of sales 62 000 Gross profit 33 576 Other operating income 6 000 Gross operating profit 39 576 Operating expenses 35 250 Operating profit 4 326 Financing costs 2 400 Profit before taxation 1926 Taxation for the year 578 Profit after taxation 1 348 Statement of Financial Position for Cash Smart (Pty) Ltd as at 30 June 2020 2020 2019 R'000 R'000 21350 19 850 Assets Non-current assets Property, plant and Equipment (@carrying value) Current assets Inventories Trade receivables Cash and cash equivalents Total assets 7 142 15 952 7 380 12 988 9 876 50 094 13 092 57 536 Equity and liabilities Ordinary share capital (par value of R0.50) Share premium Retained earnings Non-current liabilities 12 000 6 000 5 235 10 000 5 000 4 607 24 000 20 000 Long-term loan Current liabilities Trade payables Tax payable Total equity and liabilities 9 104 1 197 57 536 9 322 1 165 50 094 Additional Information: I. ii. The company declared and paid a dividend of 3 cents per ordinary share at year-end 2020. The company had no outstanding payment of dividends. A depreciation amount of R1 million was included in the operating expenses for the year ended 2020. There was no disposal of non-current assets but replacement equipment was purchased during the year ended 30 June 2020. iii. Required: 4.1 Prepare the Statement of Cash Flows for the year ended 30 June 2020 using the direct method. (20) 4.2 Prepare 4.1 using the following T-accounts: 4.2.1 Trade receivables (2) 4.2.2 Inventory (2) 4.2.3 Trade payables (3) 4.2.4 Tax payable (3) Note: Use T-accounts where necessary. In addition to the T-accounts, show all other relevant workings. Ensure all negative amounts are in brackets