Develop a cash flow statement • Majed is preparing a statement of cash flows for his second year of trading. Majed's bank decided to charge 10% interest on his loan to the business of JD 500 starting year 2. Majed paid this amount in cash during the year. The following information is available: Year 2 (JD) Year 1 (JD) Trade receivables 1,120 600 Prepayments 243 243 Trade payables 645 45 Accruals 420 270 Inventories 1000 400 Profit before tax 3,750 1,115 Depreciation expense Interest paid 150 75 50 Profit on disposal of asset 45 Required: Determine the Cash flows from operating activities (year 2)

Develop a cash flow statement • Majed is preparing a statement of cash flows for his second year of trading. Majed's bank decided to charge 10% interest on his loan to the business of JD 500 starting year 2. Majed paid this amount in cash during the year. The following information is available: Year 2 (JD) Year 1 (JD) Trade receivables 1,120 600 Prepayments 243 243 Trade payables 645 45 Accruals 420 270 Inventories 1000 400 Profit before tax 3,750 1,115 Depreciation expense Interest paid 150 75 50 Profit on disposal of asset 45 Required: Determine the Cash flows from operating activities (year 2)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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