Suggested solutions to Jessie’s Jigsaws

a. Prepare the Cash Flow Statement for the quarter ended 30 June 2015.
9 marks
JESSIE’S JIGSAWS
Cash Flow Statement for the quarter ended 30 June 2015

| $ | $ | Cash Flow from Operating Activities | | | Cash Sales | 32 980 | | GST Collected | 3 298 | | Receipts from Debtors | 17 940 | 54 218 | Payments to Creditors | (17 820) | | Stock | (4 000) | | Wages | (7 460) | | GST Paid | (3 198) | | Advertising | (2 400) | | Cartage Inwards | (760) | | Cartage Outwards | (820) | | GST Payable | (1 338) | | Interest Expense | (375) | | Prepaid Rent Expense | (15 000) | (53 171) | Net Cash Flows from Operations | | 1 047 | Cash Flow from Investing Activities | | | Furniture and Fittings | (9 000) | | Net Cash Flows from Investing Activities | | (9 000) | Cash Flow from Financing Activities | | | Capital | 5 000 | | Loan—RAB Bank | 15 000 | 20 000 | Drawings | (7 000) | | Loan—RAB Bank | (900) | (7 900) | Net Cash Flows from Financing Activities | | 12 100 | Net Increase (Decrease) in Cash Position | | 4 147 | Bank—1 April 2015 | | 7 340 | Bank—30 June 2015 | | 11 487 |
1 mark—Cash Sales and GST Collected
1 mark—Receipts from Debtors and Payments to Creditors
1 mark—Stock, Wages and GST Paid
2 marks—the six remaining operating outflows
1 mark—Investing outflow
1 mark—Financing inflows
1 mark—Financing outflows
1 mark—final 3 lines

b. Explain what is meant by the term ‘Net Cash Flows from Financing Activities’.
2 marks
Cash inflows less cash outflows (1 mark) relating to changes in the