The financial information for Archer Pty Ltd at 30 June 2019 is presented below: $ (25,000)...

 

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The financial information for Archer Pty Ltd at 30 June 2019 is presented below: $ (25,000) Cash at beginning - bank overdraft Cash paid to Suppliers 456,000 684,000 144,000 336,000 Cash receipts from customers Credit purchases of inventory Credit sales Depreciation of motor vehicles Depreciation of plant and equipment Dividends paid Expenses paid Interest paid Loan repayment Loss on sale of motor vehicle Net profit Proceeds from sale of equipment Proceeds from sale of motor vehicle Proceeds of share issue Profit on sale of equipment Purchase of property, plant and equipment Salaries paid 9,600 48,000 110,400 105,600 1,500 8,000 7,200 261,600 36,000 28,800 60,000 96,000 120,000 48,000 Required: a Prepare a Statement of Cash Flow Archer Pty Ltd for the 30 June 2019 and determine the final balance of the cash at bank. b The CEO of Archer Pty Ltd reviewed the Statement of Cash Flows prepared by the company's accountant. He was concerned that the statement shows a net outflow for investing activities. Evaluate if negative cash flows from investing activities should be a cause of concern for management and advise when the CEO should be alarmed by the certain results in the Statement of Cash Flows. The financial information for Archer Pty Ltd at 30 June 2019 is presented below: $ (25,000) Cash at beginning - bank overdraft Cash paid to Suppliers 456,000 684,000 144,000 336,000 Cash receipts from customers Credit purchases of inventory Credit sales Depreciation of motor vehicles Depreciation of plant and equipment Dividends paid Expenses paid Interest paid Loan repayment Loss on sale of motor vehicle Net profit Proceeds from sale of equipment Proceeds from sale of motor vehicle Proceeds of share issue Profit on sale of equipment Purchase of property, plant and equipment Salaries paid 9,600 48,000 110,400 105,600 1,500 8,000 7,200 261,600 36,000 28,800 60,000 96,000 120,000 48,000 Required: a Prepare a Statement of Cash Flow Archer Pty Ltd for the 30 June 2019 and determine the final balance of the cash at bank. b The CEO of Archer Pty Ltd reviewed the Statement of Cash Flows prepared by the company's accountant. He was concerned that the statement shows a net outflow for investing activities. Evaluate if negative cash flows from investing activities should be a cause of concern for management and advise when the CEO should be alarmed by the certain results in the Statement of Cash Flows.

Answer rating: 100% (QA)

a Statement of Cash Flows for Archer Pty Ltd at 30 June 2019 Cash Flows from Operating Activities Am... View the full answer