Question

Presented below is the 2021 income statement and comparative balance sheet information for Tiger Enterprises.

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$10,000 TIGER ENTERPRISES Income Statement For the Year Ended December 21, 2021 (6 in the sanda) Sales Evenue Operating expenses: Coat of goods sold DADERciation expense Insurance Qxpense Gangzal and administrative expense Total Operating expenses Income ba o income taxa Income tax expense Net income Balance Sheet Information (5 in thousanda) Dec. 31, 2021 2.300 Dec. 31, 2020 62.780 5 3.300 Accounta eivable Inventory Prepaid insurance Euipment LAR: Accutulated depreciation Total aseta Liabilities and shareholders' Equity: Accounts payable Accrued liabilities (or general administrative expense) Income tax payable Notas payable du 12/31/2022) Common stock Retained earninga Total liabilities and whareholder' equity 62, 780 $ 3,300 Required: Prepare Tiger's statement of cash flows, using the indirect method to present cash flows from operating activities. (Hint: You will have to calculate dividend payments). (Enter your answers in thousands. Amounts to be deducted should be Indicated with a minus sign.) 1,740 TIGER ENTERPRISES Statement of Cash Flows For the Year Ended December 31, 2021 in thousands) Cash flows from operating activities: | Net Income $ Adjustments for noncash efects Depreciation expense Changes in operating assets and liabilities: Decrease in accounts receivable Increase in Inventory increase in prepaid Insurance Decrease in counts payable Decrease in accrued alles Increase in Income taves pavable 3001 Net cash flows from operating activities Cash flows from Investing activities Net cash flows from Investing activities Cash flows from financing activities: ssuance of notes pavable Issuance of common stock Dividends paid to hareholders Net cash flows from financing activities Net Increase in cash Cash, January 1 Cash, December 31 5 2930

Answer 1

Solution

Tiger Enterprises
Cash Flow Statement
For the ended December 31, 2021
Cash Flow from Operating Activities:
Net Income	$ 1,740.00
Add: Adjustments to reconcile net income to net cash from operating activities
Depreciation expense	$              300.00
Increase in prepaid insurance	$              (60.00)
Decrease in Accounts Payable	$              (90.00)
Decrease in Accounts receivables	$              110.00
Increase in Inventory	$              (70.00)
Increase in income tax payable	$                20.00
Decrease in other expenses payable	$            (130.00)
A. Cash Flow from Operating Activities		$          1,820.00
Cash Flow from Investing Activities:
Purchase of Equipment	$            (600.00)
B. Cash flow from Investing Activities		$           (600.00)
Cash Flow from Financing Activities:
Issue of Common Stock	$              160.00
Dividend paid	$        (1,480.00)
Proceeds from notes payable	$              260.00
C. Cash Flow from Financing Activities		$       (1,060.00)
Increase (Decrease) in cash [A+B+C]		$             160.00
Cash January 1		$             260.00
Cash December 31		$             420.00

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Calculation of dividend paid
Beginning balance of retained earnings	$             450.00
Add: Net income	$         1,740.00
	$         2,190.00
Less: Ending balance of Retained earnings	$             710.00
Dividends paid in cash	$         1,480.00