Using the information from Exercise E5.1 prepare a statement of cash flows for Candyfloss for the first six months of the year 2010, using the indirect method.

 data Exercise E5.1

Candice-Marie James and Flossie Graham obtained a one-year lease on a small shop which cost them £15,000 for the year 2010, and in addition, agreed to pay rent of £4,000 per year payable one year in advance. Candyfloss started trading on 1 January 2010 as a florist, and Candice and Flossie bought a second-hand, white delivery van for which they paid £14,500. The business was financed by Candice and Flossie each providing £9,000 from their savings, and receipt of an interest-free loan from Candice’s uncle of £3,000. Candice and Flossie thought they were doing OK over their first six months but they weren’t sure how to measure this. They decided to try and see how they were doing financially and looked at the transactions for the first six months:

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Cash transactions: Cash sales of flowers Rent paid Wages paid Payments for other operating expenses Purchases of inventories of flowers for resale Legal expenses paid for the lease acquisition 3 76,000 4,000 5,000 7,000 59,500 1,000