Originally Posted by liberation

Q#4 (CASH FLOW STATEMENT)

Cash flow from operating activities

PBIT = 3400
ADD
Depreciation = 10,000
Machinery = 6,000
Goodwill = 2000
Interest paid = (720)
Cash flow before working capital changes = 20680

Increase in Debtors = (8,000)
Increase in stock = (400)
Decrease in Liability = (3600)
interest = 720

Cash flow from operation activities = 9400

Cash flow from investing activities

purchase of assets = o/b 20,000 - Dep 10,000 c/f 16,000 = Addition=(6,000)
purchase of machine = (12,000)

cash flow from investing activities = (18,000)

cash flow from financing activities

issue of capital = 10,000
General reserve = 4,000
Debentures = (2,000)

Cash flow from financing activities = 12,000

Cash in hand = 9,400+12,000-18,000= [3400] thus balance is this