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The accountant for Hungry Hayden Ltd has asked you to assist her in preparing and analysing the cashflow statement for the year ended 30 June
The accountant for Hungry Hayden Ltd has asked you to assist her in preparing and analysing the cashflow statement for the year ended 30 June 2020. The following accounts have been listed in alphabetical order. Cashflow statement for the year ended 30 June 2020 Account Name Acquisition of businesses, net of cash acquired Income tax paid Interest (paid) / received Net investment in Joint venture partner ($000) -10 -50 -50 -10 -45,00 Payments to suppliers and employees 0 10,000 Proceeds from borrowings Proceeds from borrowings with related parties Proceeds from issuance of shares Proceeds from sale of controlled entities Proceeds from sale of property, plant and equipment Purchase of property, plant and equipment and intangibles Purchase of shares under Equity Incentive Plan 150 5,000 620 450 -2,000 -30 38,500 Receipts from customers Repayment of borrowings Repayment of borrowings with related parties -5,000 -2,000 Required: 1. Identify each account included in the "Investing activities" section of the cashflow statement along with the total value for investing activities. State whether this total value is a cash inflow or cash outflow. (12 marks) 2. Although the net cash balance increased for the year ended 30 June 2020, the accountant is concerned about the overall cashflow for the year. Identify and explain one possible reason for cashflow problems arising from Hungry Hayden Lid's operating activities and one possible reason arising from their financing activities. (8 marks)
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