The comparative financial position of Raju Furniture Pty Ltd who makes custom design furniture as at 30 June 2019 and 2020 and the

income statement for the year ended 30 June 2020 are presented below:

	2019		2020
		($)		($)
Assets
Cash		1,000		7,500
Accounts Receivable		8,000		17,000
Inventory		26,000		40,500
Prepaid Insurance		5,000		10,000
Land		160,000		215,000
Buildings	90,000		120,000
Accumulated Depreciation buildings	-20,000		-30,000
		70,000		90,000
Total Assets		270,000		380,000
Liabilities and Equity
Accounts payable		26,500		27,500
Bank overdraft		0		0
Current tax liability		10,000		15,000
Long Term loan		30,000		62,500
Raju's capital		203,500		275,000
Total Liabilities and Equity		270,000		380,000

Raju Furniture Pty Ltd
Income Statement
for the year ended 30 June 2020
Income	$	$
Sales Revenue		300,000
Total income		300,000
Expenses
Cost of sales	175,000
Other expenses (include depreciation expense)	40,000
Income tax expense	20,000
Total expenses		235,000
PROFIT		65,000

Additional information

Raju had contributed capital during the year for $30,000 cash and the business has also paid a dividend during the year.

Required:

(a) Prepare the Statement of Cash Flow for the year ended 30^th June 2020 by filling the

template below. Show all the workings.

(b) Comment on the cash position of business i:e Interpret the cash flow statement

and comment on how you see the business is managing its cash flows.

Note:

For interpretation of cash flow statement, 1.5 marks for interpreting operating activities, 1.5 for investing activities and 1 for financing activities and 1 for the overall cash position of the business.