QUESTION FOUR [25] The following information relates to Dest, a limited liability company, for the year ended 31 October Extracts from the statement of profit or loss for the year ended 31 October 2020 R000 Finance costs (400) Investment income 180 Profit before tax 15000 Less tax 4350 Profit for the year 10650 Statement of financial position as at 31 October 2020 2020 2019 R000 R000 ASSETS Non-current assets 43282 26574 Current assets Inventory 3560 9635 Receivables 6405 4542 Cash 2045 1063 12010 15240 Total assets 55292 41814 EQUITY AND LIABILITIES Equity Ordinary share capital Retained earnings 19365 17496 16115 6465 35480 23961 Non-current liabilities Loan 8000 10300 Current liabilities Bank overdraft 1230 429 Trade payables 7562 4364 Taxation 3020 2760 11812 7553 Total equity and liabilities 55292 41814 Additional information: 1. Depreciation expense for the year was 4,658,000 2. Assets with a carrying value of 1,974,000 were disposed of at a profit of 720,000 Required: 4.1 Prepare the statement of cash flows for the year ended 31 October 2020 for Dest. 4.2 Why do firms prepare statement of cash flows? (20) (5) (note: answers can be presented without the use of table)