Question

Complete the cash flow from Operating Activities

Additions to Net Income Decrease in accounts receivable Decrease in inventory Decrease in prepaid assets Increase in accounts payable Increase in accrued liabilities Deductions from Net Income Increase in accounts receivable Increase in inventory Increase in prepaid assets Decrease in accounts payable Decrease in accrued liabilities 450 $300 Cash Flow From Operating Activities Net Income $110 Net Cash Provided by Operating Activities 2011 80 115 Cash Flows From Investing Activities Income Statement For the Year Ending 12/31/12 Sales Cost of goods sold Gross profit Operating expenses Income before interest and taxes Interest expense Income before taxes Income tax expense Net income Balance Sheet December 31 2012 Cash $ 45 Accounts receivable 155 Inventory 225 Prepaid insurance 22 Total current assets 447 Property and equipment 1,250 Accumulated depreciation (175) Total property and equipment Total assets $1,522 Accounts payable $ 120 Income taxes payable 155 Total current liabilities Bonds payable 400 Total liabilities Common stock Retained earnings 322 Total stockholders' equity 847 Total liabilities and stockholders' equity $1,522 190 32 Net Cash Used in Investing Activities 417 Cash Flows from Financing Activites (140) $1,327 $ 135 175 Net Cash Provided by Financing Activities 325 Net increase/decrease in Cash Cash at beginning of the year Cash at end of the year 217 $1,327

Answer 1

	Cash flows from operating activities
	Net income	$110
	Adjustments for non-cash effects:
	Depreciation expense	35	(175-140)
	Adjustments to reconcile net income cash
	Increase in account receivable	-$40
	Increase in inventory	-$35
	Decrease in prepaid assets	$10
	Decrease in account payable	-$15
	Decrease in accrued liabilities(income tax)	-$20
	Net cash provided by operating activities	$45
	Cashflows from Investing
	Purchase of property plant and equipment	-$200
	net cash used in investing	-$200
	Cashflows from Financing
	Bonds issued	$75
	common stock issued	$50
	Dividends paid	-$5	(217+110-322)
	Net cash provided by financing activities	$120
	Net decrease in cash	-$35
	Cash at beg.	$80
	Cash at end.	$45