Answer Happy

Question 1 Blue River Mountain Resort had the following cash transactions over the financial year ending 30 June 2022. Opening cash balance, 1 July 2021, was $5,500. Transaction Amount $675,000 Acquisition of building Received loan funds $250,000 $52,800 Payment to employees Income Tax paid $4,250 Sold machinery $220,000 Drawings $6,000 Paid bank interest $1,529 Paid suppliers for inventory Cash sales $109,075 $305,350 a. Prepare a Cash Flow statement for Blue River Mountain Resort for the year ending 30 June 2022 using the information provided. [6 marks] b. Explain why sales made on credit terms are not included in the Cashflow Statement. Your answer should include an explanation of the difference between accrual and cash accounting (max 300 words). [5 marks] c. Explain whether this business could possibly have a profit in the Income Statement. Explain your answer by providing an example. (max 300 words). [4 marks] [Total for Question 1 = 15 marks]