Question 3 Watson is a sole trader. He provides the following financial information in respect of his business. Income statement for the year ended 31 December 2012 $000 Sales Cost of sales Expenses Profit for the year 3380 (2000) (1200) 180 Statements of financial position at: 31 December 2011 $000 $000 31 December 2012 $000 $000 2000 3500 Non-current assets Freehold land Plant and machinery at cost Less: depreciation Net book value 900 (500) 1020 (470) 400 2400 550 4050 Current assets Inventory Trade receivables Cash and cash equivalents 320 210 310 240 10 560 530 = Current liabilities Trade payables Bank overdraft 200 160 530 690 200 Non-current liability - loan 500 350 Net assets 2260 3540 Additional information 4. Drawing is $400 5. During the year Winston purchased new plant at a cost of $200 000. He also sold some plant that had a net book value of $20 000 and had been depreciated by $60 000. This resulted in a loss on disposal of $2000. REQUIRED (a) Prepare a statement of cash flows for the year ended 31 December 2012