Question

Check my work P12-1 (Algo) Preparing a Statement of Cash Flows (Indirect Method) LO12-1, 12-2, 12-4, 12-6 Sharp Screen Films, Inc., is developing its annual financial statements at December 31, current year. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized as follows: Balance sheet at December 31 ok Current Year Prior Year Cash Accounts receivable Merchandise inventory Property and equipment Less: Accumulated depreciation nt $ 65,950 16, ese 23,25e 2e9,95e (6e, 100) $255,1e0 $ 9,900 3,eee $64,400 23,250 18,400 ences 151,900 (46,150) $211,88e $ 20,000 3,200 Accounts payable Wages payable Note payable, long-term Common stock and additional paid-in capital Retained earnings 61,3e0 99,800 72,10e 66, 300 5e, 20e $211, 808 81,100 $255,100 Income statement for current year Sales $199,e00 96,00e 13,950 43,400 $ 45.650 Cost of goods sold Depreciation expense Other expenses Net income <Prev 6 of 6 Next re to search 429 PM 11/27/201

Answer 1

Statement of Cash Flows - Indirect Method
	Amount in $	Amount in $
Net income		$             45,650
Cash flows from operating activities
Adjustments for:
Depreciation	$                13,950
(Increase) / Decrease in Account receivables	$                  7,200
Inventory Decrease / (Increase)	$                 -4,850
Accounts payable Increase / ( Decrese)	$              -10,100
Decrease in Wages Payable	$                    -200
		$                6,000
Net cash from operating activities		$             51,650
Cash flows from investing activities
Purchase of Equipment	$              -58,050
Net cash used in investing activities		$            -58,050
Cash flows from Financing activities
Issue of Common Shares	$                33,500
Redumption of long term notes payable	$              -10,800
Dividend Paid	$              -14,750
Net cash used in financing activities		$                7,950
Net increase in cash and cash equivalents		$                1,550
Add :Cash and cash equivalents at beginning of period		$             64,400
Cash and cash equivalents at end of period		$             65,950