Kim Khan has been in business as a sole trader for the past 5 years. The comparative statements of financial position for the years 2019 and 2020 and a summarised income statement for the year ended 30 June 2020 are shown below.

Additional information

Kim had contributed capital during the year for $6000 cash and had made cash withdrawals during the year. The bank overdraft was considered to be part of the entity’s everyday cash management activities.

Required

Prepare a statement of cash flows using the direct method for Kim Khan’s business for the year ended 30 June 2020.

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CURRENT ASSETS Cash Accounts receivable Inventory Prepaid insurance NON-CURRENT ASSETS Equipment Kim Khan Comparative Statements of Financial Position as at 30 June 2019 2020 $ 4290 6000 300 $ 540 3150 6600 360 19 200 25 500 Accumulated depreciation equipment (6 000) (7 500) Land 20 400 24 000 Motor vehicles 14 550 15 600 Accumulated depreciation motor vehicles (5 490) (6 300) TOTAL ASSETS 53 250 61 950 CURRENT LIABILITIES Bank overdraft Accounts payable NON-CURRENT LIABILITIES Long-term mortgage TOTAL LIABILITIES 300 6150 7 950 14 100 20 550 18900 26 850 $35 100 NET ASSETS $32 700 EQUITY Kim Khan, Capital 32 700 35 100 TOTAL EQUITY $32 700 $35 100