QUESTION $2$

The Mac $10$ Department Store produced the following data for $2022$:

Additional information available was:

The building was revalued during the year.

Equipment costing $25,000$ for which there a provision for depreciation of $5,500$

was sold for a profit of $6,000.$

Dividends paid and proposed for the year amounted to $27,000$

Required:

$($a$).$ Prepare the cash flow statement for the year.

$($b$)$ The Chairman of the board had expressed concern over the declining current assets,

especially in the depletion of the bank balance. Using items in the cash flow statements and$/$or

any other relevant information, explain the financial position and apparent stability of the

company.

$(5$ marks$)$