Question

The following data are revealed by King Kong Pty Ltd at 30 June 2019.

Cash balance at 1 July 2018	$50 000
Gain on sale of equipment	6 000
Income tax payments	21 000
Cash paid to suppliers	153 500
Cash received from customers	425 500
Proceeds from issue of shares	216 000
Proceeds from sale of land	76 000
Depreciation expense	55 000
Interest payments	30 000
Payments of long-term debt	16 500
Payments to employees	78 000
Dividends received from investment in shares	17 500
Investment in new technology equipment	335 000
Payments of dividends to shareholders	22 000

Required:

Use the direct method to prepare a Statement of Cash Flows for King Kong Pty Ltd for the year ended 30 June 2019.

Answer 1

King Kong Pty Ltd
Statement of Cash flows
For the year ended 30 June 2019
Cash Flows from Operating activities
Cash Paid to suppliers	(153,500)
Cash received from customers	425,500
Payment to employees	(78,000)
Income Tax Paid	(21,000)
Interest payments	(30,000)
Net cash from operating activites		143,000
Cash Flows from Investing activities
Proceeds from sale of land	76,000
Investment in new technology equipment	(335,000)
Net cash from investing activities		(259,000)
Cash Flows from Financing activities
Proceeds from issue of shares	216,000
Payments of long-tern debt	(16,500)
Dividends received from investment of shares	17,500
Payments of dividends to shareholders	(22,000)
Net cash from financing activities		195,000
Net increase in cash and cash equivalents		79,000
Cash and cash equivalents at the beginning of the year		50,000
Cash and cash equivalents at the end of the year		129,000