Financial Accounting Report - Cash Flow Analysis and Evaluation

This report presents a detailed cash flow analysis for T Pty Limited for the year ending June 30, 2020. The analysis includes a breakdown of cash flows from operating, investing, and financing activities. The operating activities section details the profit after tax, depreciation, and changes in accounts receivable, inventory, prepayments, accounts payable, and tax payable, resulting in a net cash provided by operating activities of $1,215,000. Investing activities cover capital expenditure and depreciation, resulting in a net cash used of $357,000. Financing activities include payments of long-term debt and dividends paid, leading to a net cash used of $997,000. The report concludes with the calculation of the increase or decrease in cash and the final cash balance. The report also references relevant academic papers on cash flow analysis and financial accounting.

Running head: FINANCIAL ACCOUNTING
Financial Accounting
Name of the Student:
Name of the University:
Author’s Note:
Course ID:

1FINANCIAL ACCOUNTING
Answer to Question 4:
T Pty Limited
Cash Flow Statement
for the year ended 30 June 2020
Particulars Amount (in $'000)
Cash flows from operating activities:
Profit after tax 150
Depreciation:
Building 40
Plant and equipment 100
Total depreciation 140
Changes in other accounts affecting
operations:
(Increase)/Decrease in accounts receivable 243
(Increase)/Decrease in inventory 288
(Increase)/Decrease in prepayments 115
(Increase)/Decrease in accounts payable 154
(Increase)/Decrease in tax payable 125
Net cash provided by operating activities 1,215
Cash flows from investing activities:
Capital expenditure:
Net plant and equipment 257

2FINANCIAL ACCOUNTING
Depreciation 100
Total capital expenditure (357)
Proceeds from sale of equipment -
Proceeds from sale of investment -
Net cash provided by investing activities (357)
Cash flows from financing activities:
Payments of long-term debt (935)
Proceeds from issuance of long-term debt -
Proceeds from issuance of common stock -
Dividends paid (62)
Net cash provided by financing activities (997)
Increase or decrease in cash (139)
Opening cash balance 274
Closing cash balance 135

3FINANCIAL ACCOUNTING
Bibliographies:
Farshadfar, S. and Monem, R., 2013. Further evidence on the usefulness of direct method cash
flow components for forecasting future cash flows. The international journal of
accounting, 48(1), pp.111-133.
Jones, S., 2016. A Cash Flow Based Model of Corporate Bankruptcy in Australia. Journal of
Applied Management Accounting Research, 14(1), p.23.