Question

Presented below is the 2021 income statement and comparative balance sheet information for Tiger Enterprises. $ 8,000 $ 3,600 260 200 2,000 6,060 1,940 (776) $ 1,164 Dec. 31, 2020 Dec. 31,2021 TIGER ENTERPRISES Income Statement For the Year Ended December 31, 2021 ($ in thousands) Sales revenue Operating expenses: Cost of goods sold Depreciation expense Insurance expense General and administrative expense Total operating expenses Income before income taxes Income tax expense Net income Balance Sheet Information ($ in thousands) Assets: Cash Accounts receivable Inventory Prepaid insurance Equipment Less: Accumulated depreciation Total assets Liabilities and Shareholders' Equity: Accounts payable Accrued liabilities (for general & administrative expense) Income taxes payable Notes payable (due 12/31/2022) Common stock Retained earnings Total liabilities and shareholders' equity $ 340 760 670 70 $ 220 850 620 30 1.900 (620) $ 3,000 2,300 (880) $ 3,260 $ 380 420 $ 310 310 210 920 940 570 $ 3,260 170 700 820 510 $ 3,000 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.)

Answer 1

	Statement of Cash Flows - Indirect Approach
		Amount in $	Amount in $
	Net income		$                1,164
	Cash flows from operating activities
	Adjustments for reconcile the net income to:
	Depreciation	$                   260
	Decrease in account receivable	$                      90
	Increase in inventory	$                    -50
	Increase in Prepaid expenses	$                    -40
	Decrease on account payable	$                    -70
	Decrease in Accrued liabilities	$                  -110
	Increase in income tax payable	$                      40
			$                   120
	Net cash from operating activities		$                1,284
	Cash flows from investing activities
	Purchase of Equipment	$                  -400
	Net cash used in investing activities		$                  -400
	Cash flows from Financing activities
	Issue of Common Stock	$                   120
	Dividend Paid	$              -1,104
	Issue of note Payable	$                   220
	Net cash used in financing activities		$                  -764
	Net increase in cash and cash equivalents		$                   120
	Add :Cash and cash equivalents at beginning of period		$                   220
	Cash and cash equivalents at end of period		$                   340
	CACLULATION OF DIVIDEND PAID
	Net Profit =	$                1,164
	Add: Opening	$                   510
	Less: Closing	$                   570
		$                1,104