Discuss Hien’s cash position. Is there any other information which might be useful to you in order to give her good advice

Hien is in business selling high quality glassware to retailers. Her accountant prepares a statement of financial position each year following Hien’s year end of 31 December. It is now 30 June 20X3. Hien, who has no knowledge of accounting, asks you for some assistance:

‘I know you’re studying accountancy and I’ve got a little exercise for you. The situation is this: I seem to be doing really well if the bank account is anything to go by. At over £62,000 the balance is higher than it’s ever been before. I’m wondering if I can actually spend this money. I don’t need it for myself but I’m thinking about buying some shares in the glass company which supplies a lot of the goods I sell. Could you possibly draw up a statement of financial position for me for the end of June and let me know whether the business is really looking as

healthy as I think it is?’ 

Hien supplies the following list of balances at 30 June, prepared by her book-keeper.

                                                                                   £

Capital                                                                     151,068

Questions: (indicative wordcount 150 words)

1. Prepare the statement of financial position at 30 June 20X3.

Discuss Hien’s cash position. Is there any other information which might be useful to you in order to give her good advice